FIN 402 Week 1 AssignmentCase Problem 2.1Dara ’ s Dilemma : What to Buy ?
Case Problem 12.1 Reverend Mark Thomas Ponders Mutual Funds The Reverend Mark Thomas is the minister of a church in the San Diego area . He is married , has one young child , and earns a ― modest income .‖ Because religious organizations are not notorious for their generous retirement programs , the reverend has decided he should do some investing on his own . He would like to set up a program that enables him to supplement the church ’ s retirement program and at the same time provide some funds for his child ’ s college education ( which is still some 12 years away ). He is not out to break any investment records but wants some backup to provide for the long-run needs of his family . Although he has a modest income , Mark Thomas believes that with careful planning , he can probably invest about $ 250 a quarter ( and , with luck , increase this amount over time ). He currently has about $ 15,000 in a savings account that he would be willing to use to begin this program . In view of his investment objectives , he is not interested in taking a lot of risk . Because his knowledge of investments extends to savings accounts , Series EE savings bonds , and a little bit about mutual funds , he approaches you for some investment advice . Questions a . In light of Mark ’ s long-term investment goals , do you think mutual funds are an appropriate investment vehicle for him ? b . Do you think he should use his $ 15,000 savings to start a mutual fund investment program ? c . What type of mutual fund investment program would you set up for the reverend ? Include in your answer some discussion of the types of funds you would consider , the investment objectives you would set , and any investment services ( e . g ., withdrawal plans ) you would seek . Would taxes be an important consideration in your investment advice ? Explain . ============================================
FIN 402 Week 1 AssignmentCase Problem 2.1Dara ’ s Dilemma : What to Buy ?