Planit:Assets and Liabilities Case Study

From Planipedia

Country Specific

Canada English

Example Problem One: David has $80,000 in an RRSP but Debbie only has $50,000 in hers. They have a non-registered account between the two of them with $30,000. They have some education capital already accumulated, valued at $18,000. Their house has a current market value of $325,000 , but there was a mortgage taken out against it 2 years ago for $200,000. The loan is to be renewed in three years, currently with an interest rate of 5.75%. Each month they pay $1,250.04 towards the loan. Solution using Summary Assets: On the Assets and Liabilities screen, the clients’ holdings will only be entered at the summary level. So, from what they told us of their assets: 1. Enter the $50,000 value of Debbie’s RRSP under Debbie’s Debbie's Registered Investment 2. Enter the $80,000 value of David’s RRSP under David’s Registered Investments Note: Make sure that you are entering this capital under the “Assets” column, not the “Liabilities” column. 3. Enter the $30,000 value of the joint non-registered holdings under the Non-registered investments account 4. The $18,000 of education capital can be entered under Education Savings 5. Before we enter the information for their personal use investments, we must determine the balance of the mortgage using the Loan Calculator. To save your current work, click Calculate Click on the Home link on the top menu bar, and access the Loan Calculator from under the Calculators drop-down menu. Enter the data as follows: 1. Enter the $200,000 principal of the loan in the Amount Borrowed field. 2. Enter the Loan Date as two years ago on January 1st. 3. Enter the Renewal Date as the Loan Date plus 5 years, since at the end of the term the interest rate will change. Note: The Renewal Date does not always signify the end of the loan, but rather when the interest rate is liable to change, or for viewing the balance and interest paid by a particular date. 4. Enter an Interest Rate of 5.75%. 5. Click the drop down menu for the Compounding frequency and choose semi-annual. 6. Click the drop down menu beside Payment Type and choose the Blended payment option. 7. If necessary change the Frequency of Payment to the Monthly option, and the Payment amount to $1,250.04 8. Click on the Calculate button next to Amortization Period. The result should be roughly 25 years. 9. On the right of the calculator, next to the Current balance at field, the current balance of the loan will be listed. The balance of the mortgage will change depending on when you do the calculation, but should be around $180,000. 1. Use the Home link on the top menu, and return to the Assets & Liabilities page using the navigation panel under Client Data Entry. 2. Enter the current market value of the residence under Personal Use, and the new mortgage value under Personal Use Liabilities. 3. Review the information and then click Calculate.

United States of America

Example Problem One: David has $80,000 in an 401(k) but Debbie only has $50,000 in hers. They have a Non-registered account between the two of them with $30,000. They have some education capital already accumulated, valued at $18,000. Their house has a current market value of $325,000 , but there was a mortgage taken out against it 2 years ago for $200,000. The loan is to be renewed in three years, currently with an interest rate of 5.75%. Each month they pay $1,250.04 towards the loan. Solution using Summary Assets: On the Assets and Liabilities screen, the clients’ holdings will only be entered at the summary level. So, from what they told us of their assets: 1. Enter the $50,000 value of Debbie’s IRA under Debbie’s Debbie's Registered Investment 2. Enter the $80,000 value of David’s IRA under David’s Registered Investments Note: Make sure that you are entering this capital under the “Assets” column, not the “Liabilities” column. 3. Enter the $30,000 value of the joint non-registered holdings under the Non-registered investments account 4. The $18,000 of education capital can be entered under Education Savings 5. Before we enter the information for their personal use investments, we must determine the balance of the mortgage using the Loan Calculator. To save your current work, click Calculate Click on the Home link on the top menu bar, and access the Loan Calculator from under the Calculators drop-down menu. Enter the data as follows: 1. Enter the $200,000 principal of the loan in the Amount Borrowed field. 2. Enter the Loan Date as two years ago on January 1st. 3. Enter the Renewal Date as the Loan Date plus 5 years, since at the end of the term the interest rate will change. Note: The Renewal Date does not always signify the end of the loan, but rather when the interest rate is liable to change, or for viewing the balance and interest paid by a particular date. 4. Enter an Interest Rate of 5.75%. 5. Click the drop down menu for the Compounding frequency and choose semi-annual. 6. Click the drop down menu beside Payment Type and choose the Blended payment option. 7. If necessary change the Frequency of Payment to the Monthly option, and the Payment amount to $1,250.04 8. Click on the Calculate button next to Amortization Period. The result should be roughly 25 years. 9. On the right of the calculator, next to the Current balance at field, the current balance of the loan will be listed. The balance of the mortgage will change depending on when you do the calculation, but should be around $180,000. 1. Use the Home link on the top menu, and return to the Assets & Liabilities page using the navigation panel under Client Data Entry. 2. Enter the current market value of the residence under Personal Use, and the new mortgage value under Personal Use Liabilities. 3. Review the information and then click Calculate.

Argentina

Example Problem One: David has $300 000 in an AFJP but Debbie only has $200 000 in hers. They have a Investments account between the two of them with $115,000. They have some education capital already accumulated, valued at $70 000. Their house has a current market value of $1 250 000 , but there was a mortgage taken out against it 2 years ago for $750 000. The loan is to be renewed in three years, currently with an interest rate of 5.75%. Each month they pay $5 000 towards the loan. Solution using Summary Assets: On the Assets and Liabilities screen, the clients’ holdings will only be entered at the summary level. So, from what they told us of their assets: 1. Enter the $200 000 value of Debbie’s AFJP under Debbie’s Registered Investment 2. Enter the $300 000 value of David’s AFJP under David’s Registered Investments Note: Make sure that you are entering this capital under the “Assets” column, not the “Liabilities” column. 3. Enter the $115,000 value of the joint non-registered holdings under the Non-registered investments account 4. The $70 000 of education capital can be entered under Education Savings 5. Before we enter the information for their personal use investments, we must determine the balance of the mortgage using the Loan Calculator. To save your current work, click Calculate Click on the Home link on the top menu bar, and access the Loan Calculator from under the Calculators drop-down menu. Enter the data as follows: 1. Enter the $750 000 principal of the loan in the Amount Borrowed field. 2. Enter the Loan Date as two years ago on January 1st. 3. Enter the Renewal Date as the Loan Date plus 5 years, since at the end of the term the interest rate will change. Note: The Renewal Date does not always signify the end of the loan, but rather when the interest rate is liable to change, or for viewing the balance and interest paid by a particular date. 4. Enter an Interest Rate of 5.75%. 5. Click the drop down menu for the Compounding frequency and choose semi-annual. 6. Click the drop down menu beside Payment Type and choose the Blended payment option. 7. If necessary change the Frequency of Payment to the Monthly option, and the Payment amount to $5 000 8. Click on the Calculate button next to Amortization Period. The result should be roughly 22 years. 9. On the right of the calculator, next to the Current balance at field, the current balance of the loan will be listed. The balance of the mortgage will change depending on when you do the calculation, but should be around $650 000. 1. Use the Home link on the top menu, and return to the Assets & Liabilities page using the navigation panel under Client Data Entry. 2. Enter the current market value of the residence under Personal Use, and the new mortgage value under Personal Use Liabilities. 3. Review the information and then click Calculate.

Brazil

Example Problem One: David has R$5 750 000 in an Tax Sheltered but Debbie only has R$3 600 000 in hers. They have a Open account between the two of them with R$2 150 000. They have some education capital already accumulated, valued at R$1 300 000. Their house has a current market value of R$24 000 000 , but there was a mortgage taken out against it 2 years ago for R$15 000 000. The loan is to be renewed in three years, currently with an interest rate of 5.75%. Each month they pay R$90 000 towards the loan. Solution using Summary Assets: On the Assets and Liabilities screen, the clients’ holdings will only be entered at the summary level. So, from what they told us of their assets: 1. Enter the R$3 600 000 value of Debbie’s Tax Sheltered under Debbie’s Tax Sheltered 2. Enter the R$5 750 000 value of David’s Tax Sheltered under David’s Registered Investments Note: Make sure that you are entering this capital under the “Assets” column, not the “Liabilities” column. 3. Enter the R$2 150 000 value of the joint non-registered holdings under the Non-registered investments account 4. The R$1 300 000 of education capital can be entered under Education Savings 5. Before we enter the information for their personal use investments, we must determine the balance of the mortgage using the Loan Calculator. To save your current work, click Calculate Click on the Home link on the top menu bar, and access the Loan Calculator from under the Calculators drop-down menu. Enter the data as follows: 1. Enter the R$15 000 000 principal of the loan in the Amount Borrowed field. 2. Enter the Loan Date as two years ago on January 1st. 3. Enter the Renewal Date as the Loan Date plus 5 years, since at the end of the term the interest rate will change. Note: The Renewal Date does not always signify the end of the loan, but rather when the interest rate is liable to change, or for viewing the balance and interest paid by a particular date. 4. Enter an Interest Rate of 5.75%. 5. Click the drop down menu for the Compounding frequency and choose semi-annual. 6. Click the drop down menu beside Payment Type and choose the Blended payment option. 7. If necessary change the Frequency of Payment to the Monthly option, and the Payment amount to R$90 000 8. Click on the Calculate button next to Amortization Period. The result should be roughly 27.5 years. 9. On the right of the calculator, next to the Current balance at field, the current balance of the loan will be listed. The balance of the mortgage will change depending on when you do the calculation, but should be around R$13 775 000. 1. Use the Home link on the top menu, and return to the Assets & Liabilities page using the navigation panel under Client Data Entry. 2. Enter the current market value of the residence under Personal Use, and the new mortgage value under Personal Use Liabilities. 3. Review the information and then click Calculate.

United Kingdom

Example Problem One: David has £50 000 in an ISA but Debbie only has £30 000 in hers. They have a general taxable investment account account between the two of them with £20 000. They have some education capital already accumulated, valued at £11 000. Their house has a current market value of £200 000 , but there was a mortgage taken out against it 2 years ago for £125 000. The loan is to be renewed in three years, currently with an interest rate of 5.75%. Each month they pay £775 towards the loan. Solution using Summary Assets: On the Assets and Liabilities screen, the clients’ holdings will only be entered at the summary level. So, from what they told us of their assets: 1. Enter the £30 000 value of Debbie’s Tax Efficient Investments under Debbie’s Tax Efficient Investments 2. Enter the £50 000 value of David’s Tax Efficient Investments under David’s Registered Investments Note: Make sure that you are entering this capital under the “Assets” column, not the “Liabilities” column. 3. Enter the £20 000 value of the joint non-registered holdings under the Non-registered investments account 4. The £11 000 of education capital can be entered under Education Savings 5. Before we enter the information for their personal use investments, we must determine the balance of the mortgage using the Loan Calculator. To save your current work, click Calculate Click on the Home link on the top menu bar, and access the Loan Calculator from under the Calculators drop-down menu. Enter the data as follows: 1. Enter the £125 000 principal of the loan in the Amount Borrowed field. 2. Enter the Loan Date as two years ago on January 1st. 3. Enter the Renewal Date as the Loan Date plus 5 years, since at the end of the term the interest rate will change. Note: The Renewal Date does not always signify the end of the loan, but rather when the interest rate is liable to change, or for viewing the balance and interest paid by a particular date. 4. Enter an Interest Rate of 5.75%. 5. Click the drop down menu for the Compounding frequency and choose semi-annual. 6. Click the drop down menu beside Payment Type and choose the Blended payment option. 7. If necessary change the Frequency of Payment to the Monthly option, and the Payment amount to £775 8. Click on the Calculate button next to Amortization Period. The result should be roughly 25.5 years. 9. On the right of the calculator, next to the Current balance at field, the current balance of the loan will be listed. The balance of the mortgage will change depending on when you do the calculation, but should be around £110 000. 1. Use the Home link on the top menu, and return to the Assets & Liabilities page using the navigation panel under Client Data Entry. 2. Enter the current market value of the residence under Personal Use, and the new mortgage value under Personal Use Liabilities. 3. Review the information and then click Calculate.

Russia

Example Problem One: David has руб.2 400 000 in an Investment Account but Debbie only has руб.1 500 000 in hers. They have a Non-registered account between the two of them with руб.900 000. They have some education capital already accumulated, valued at руб.550 000. Their house has a current market value of руб.10 000 000 , but there was a mortgage taken out against it 2 years ago for руб.6 000 000. The loan is to be renewed in three years, currently with an interest rate of 5.75%. Each month they pay руб.40 000 towards the loan. Solution using Summary Assets: On the Assets and Liabilities screen, the clients’ holdings will only be entered at the summary level. So, from what they told us of their assets: 1. Enter the руб.1 500 000 value of Debbie’s Investment Account under Debbie’s Investment Account 2. Enter the руб.2 400 000 value of David’s Investment Account under David’s Registered Investments Note: Make sure that you are entering this capital under the “Assets” column, not the “Liabilities” column. 3. Enter the руб.900 000 value of the joint non-registered holdings under the Non-registered investments account 4. The руб.550 000 of education capital can be entered under Education Savings 5. Before we enter the information for their personal use investments, we must determine the balance of the mortgage using the Loan Calculator. To save your current work, click Calculate Click on the Home link on the top menu bar, and access the Loan Calculator from under the Calculators drop-down menu. Enter the data as follows: 1. Enter the руб.6 000 000 principal of the loan in the Amount Borrowed field. 2. Enter the Loan Date as two years ago on January 1st. 3. Enter the Renewal Date as the Loan Date plus 5 years, since at the end of the term the interest rate will change. Note: The Renewal Date does not always signify the end of the loan, but rather when the interest rate is liable to change, or for viewing the balance and interest paid by a particular date. 4. Enter an Interest Rate of 5.75%. 5. Click the drop down menu for the Compounding frequency and choose semi-annual. 6. Click the drop down menu beside Payment Type and choose the Blended payment option. 7. If necessary change the Frequency of Payment to the Monthly option, and the Payment amount to руб.40 000 8. Click on the Calculate button next to Amortization Period. The result should be roughly 22 years. 9. On the right of the calculator, next to the Current balance at field, the current balance of the loan will be listed. The balance of the mortgage will change depending on when you do the calculation, but should be around руб.5 250 000. 1. Use the Home link on the top menu, and return to the Assets & Liabilities page using the navigation panel under Client Data Entry. 2. Enter the current market value of the residence under Personal Use, and the new mortgage value under Personal Use Liabilities. 3. Review the information and then click Calculate.

China

Example Problem One: David has ¥500 000 in an Personal Retirement Insurance Account but Debbie only has ¥325 000 in hers. They have a Investment Account account between the two of them with ¥200 000. They have some education capital already accumulated, valued at ¥100 000. Their house has a current market value of ¥2 100 000 , but there was a mortgage taken out against it 2 years ago for ¥1 300 000. The loan is to be renewed in three years, currently with an interest rate of 5.75%. Each month they pay ¥8 000 towards the loan. Solution using Summary Assets: On the Assets and Liabilities screen, the clients’ holdings will only be entered at the summary level. So, from what they told us of their assets: 1. Enter the ¥325 000 value of Debbie’s Personal Retirement Insurance Account under Debbie’s Personal Retirement Insurance Account 2. Enter the ¥500 000 value of David’s Personal Retirement Insurance Account under David’s Registered Investments Note: Make sure that you are entering this capital under the “Assets” column, not the “Liabilities” column. 3. Enter the ¥200 000 value of the joint non-registered holdings under the Non-registered investments account 4. The ¥100 000 of education capital can be entered under Education Savings 5. Before we enter the information for their personal use investments, we must determine the balance of the mortgage using the Loan Calculator. To save your current work, click Calculate Click on the Home link on the top menu bar, and access the Loan Calculator from under the Calculators drop-down menu. Enter the data as follows: 1. Enter the ¥1 300 000 principal of the loan in the Amount Borrowed field. 2. Enter the Loan Date as two years ago on January 1st. 3. Enter the Renewal Date as the Loan Date plus 5 years, since at the end of the term the interest rate will change. Note: The Renewal Date does not always signify the end of the loan, but rather when the interest rate is liable to change, or for viewing the balance and interest paid by a particular date. 4. Enter an Interest Rate of 5.75%. 5. Click the drop down menu for the Compounding frequency and choose semi-annual. 6. Click the drop down menu beside Payment Type and choose the Blended payment option. 7. If necessary change the Frequency of Payment to the Monthly option, and the Payment amount to ¥8 000 8. Click on the Calculate button next to Amortization Period. The result should be roughly 26 years. 9. On the right of the calculator, next to the Current balance at field, the current balance of the loan will be listed. The balance of the mortgage will change depending on when you do the calculation, but should be around ¥1 175 000. 1. Use the Home link on the top menu, and return to the Assets & Liabilities page using the navigation panel under Client Data Entry. 2. Enter the current market value of the residence under Personal Use, and the new mortgage value under Personal Use Liabilities. 3. Review the information and then click Calculate.

Malaysia

Example Problem One: David has RM250 000 in an EPF but Debbie only has RM150 000 in hers. They have a Non-EPF account between the two of them with RM90 000. They have some education capital already accumulated, valued at RM50 000. Their house has a current market value of RM1 000 000 , but there was a mortgage taken out against it 2 years ago for RM600 000. The loan is to be renewed in three years, currently with an interest rate of 5.75%. Each month they pay RM3 800 towards the loan. Solution using Summary Assets: On the Assets and Liabilities screen, the clients’ holdings will only be entered at the summary level. So, from what they told us of their assets: 1. Enter the RM150 000 value of Debbie’s EPF under Debbie’s EPF 2. Enter the RM250 000 value of David’s EPF under David’s Registered Investments Note: Make sure that you are entering this capital under the “Assets” column, not the “Liabilities” column. 3. Enter the RM90 000 value of the joint non-registered holdings under the Non-registered investments account 4. The RM50 000 of education capital can be entered under Education Savings 5. Before we enter the information for their personal use investments, we must determine the balance of the mortgage using the Loan Calculator. To save your current work, click Calculate Click on the Home link on the top menu bar, and access the Loan Calculator from under the Calculators drop-down menu. Enter the data as follows: 1. Enter the RM600 000 principal of the loan in the Amount Borrowed field. 2. Enter the Loan Date as two years ago on January 1st. 3. Enter the Renewal Date as the Loan Date plus 5 years, since at the end of the term the interest rate will change. Note: The Renewal Date does not always signify the end of the loan, but rather when the interest rate is liable to change, or for viewing the balance and interest paid by a particular date. 4. Enter an Interest Rate of 5.75%. 5. Click the drop down menu for the Compounding frequency and choose semi-annual. 6. Click the drop down menu beside Payment Type and choose the Blended payment option. 7. If necessary change the Frequency of Payment to the Monthly option, and the Payment amount to RM3 800 8. Click on the Calculate button next to Amortization Period. The result should be roughly 24.3 years. 9. On the right of the calculator, next to the Current balance at field, the current balance of the loan will be listed. The balance of the mortgage will change depending on when you do the calculation, but should be around RM535 000. 1. Use the Home link on the top menu, and return to the Assets & Liabilities page using the navigation panel under Client Data Entry. 2. Enter the current market value of the residence under Personal Use, and the new mortgage value under Personal Use Liabilities. 3. Review the information and then click Calculate.

Singapore

Example Problem One: David has S$100 000 in an CPF but Debbie only has S$65 000 in hers. They have a Non-Registered account between the two of them with S$40 000. They have some education capital already accumulated, valued at S$25 000. Their house has a current market value of S$425 000 , but there was a mortgage taken out against it 2 years ago for S$250 000. The loan is to be renewed in three years, currently with an interest rate of 5.75%. Each month they pay S$1 600 towards the loan. Solution using Summary Assets: On the Assets and Liabilities screen, the clients’ holdings will only be entered at the summary level. So, from what they told us of their assets: 1. Enter the S$65 000 value of Debbie’s CPF under Debbie’s CPF 2. Enter the S$100 000 value of David’s CPF under David’s Registered Investments Note: Make sure that you are entering this capital under the “Assets” column, not the “Liabilities” column. 3. Enter the S$40 000 value of the joint non-registered holdings under the Non-registered investments account 4. The S$25 000 of education capital can be entered under Education Savings 5. Before we enter the information for their personal use investments, we must determine the balance of the mortgage using the Loan Calculator. To save your current work, click Calculate Click on the Home link on the top menu bar, and access the Loan Calculator from under the Calculators drop-down menu. Enter the data as follows: 1. Enter the S$250 000 principal of the loan in the Amount Borrowed field. 2. Enter the Loan Date as two years ago on January 1st. 3. Enter the Renewal Date as the Loan Date plus 5 years, since at the end of the term the interest rate will change. Note: The Renewal Date does not always signify the end of the loan, but rather when the interest rate is liable to change, or for viewing the balance and interest paid by a particular date. 4. Enter an Interest Rate of 5.75%. 5. Click the drop down menu for the Compounding frequency and choose semi-annual. 6. Click the drop down menu beside Payment Type and choose the Blended payment option. 7. If necessary change the Frequency of Payment to the Monthly option, and the Payment amount to S$1 600 8. Click on the Calculate button next to Amortization Period. The result should be roughly 23.8 years. 9. On the right of the calculator, next to the Current balance at field, the current balance of the loan will be listed. The balance of the mortgage will change depending on when you do the calculation, but should be around S$220 000. 1. Use the Home link on the top menu, and return to the Assets & Liabilities page using the navigation panel under Client Data Entry. 2. Enter the current market value of the residence under Personal Use, and the new mortgage value under Personal Use Liabilities. 3. Review the information and then click Calculate.

Hong Kong

Example Problem One: David has HK$600 000 in an Personal Retirement Insurance but Debbie only has HK$375 000 in hers. They have a Investment Account account between the two of them with HK$225 000. They have some education capital already accumulated, valued at HK$125 000. Their house has a current market value of HK$2 500 000 , but there was a mortgage taken out against it 2 years ago for HK$1 500 000. The loan is to be renewed in three years, currently with an interest rate of 5.75%. Each month they pay HK$10 000 towards the loan. Solution using Summary Assets: On the Assets and Liabilities screen, the clients’ holdings will only be entered at the summary level. So, from what they told us of their assets: 1. Enter the HK$375 000 value of Debbie’s Personal Retirement Insurance under Debbie’s Personal Retirement Insurance 2. Enter the HK$600 000 value of David’s Personal Retirement Insurance under David’s Registered Investments Note: Make sure that you are entering this capital under the “Assets” column, not the “Liabilities” column. 3. Enter the HK$225 000 value of the joint non-registered holdings under the Non-registered investments account 4. The HK$125 000 of education capital can be entered under Education Savings 5. Before we enter the information for their personal use investments, we must determine the balance of the mortgage using the Loan Calculator. To save your current work, click Calculate Click on the Home link on the top menu bar, and access the Loan Calculator from under the Calculators drop-down menu. Enter the data as follows: 1. Enter the HK$1 500 000 principal of the loan in the Amount Borrowed field. 2. Enter the Loan Date as two years ago on January 1st. 3. Enter the Renewal Date as the Loan Date plus 5 years, since at the end of the term the interest rate will change. Note: The Renewal Date does not always signify the end of the loan, but rather when the interest rate is liable to change, or for viewing the balance and interest paid by a particular date. 4. Enter an Interest Rate of 5.75%. 5. Click the drop down menu for the Compounding frequency and choose semi-annual. 6. Click the drop down menu beside Payment Type and choose the Blended payment option. 7. If necessary change the Frequency of Payment to the Monthly option, and the Payment amount to HK$10 000 8. Click on the Calculate button next to Amortization Period. The result should be roughly 22 years. 9. On the right of the calculator, next to the Current balance at field, the current balance of the loan will be listed. The balance of the mortgage will change depending on when you do the calculation, but should be around HK$1 300 000. 1. Use the Home link on the top menu, and return to the Assets & Liabilities page using the navigation panel under Client Data Entry. 2. Enter the current market value of the residence under Personal Use, and the new mortgage value under Personal Use Liabilities. 3. Review the information and then click Calculate.

India

Example Problem One: David has 350 000 in an MPF but Debbie only has 2 200 000 in hers. They have a Open Investments account between the two of them with 1 300 000. They have some education capital already accumulated, valued at 800 000. Their house has a current market value of 14 500 000 , but there was a mortgage taken out against it 2 years ago for 9 000 000. The loan is to be renewed in three years, currently with an interest rate of 5.75%. Each month they pay 55 000 towards the loan. Solution using Summary Assets: On the Assets and Liabilities screen, the clients’ holdings will only be entered at the summary level. So, from what they told us of their assets: 1. Enter the 2 200 000 value of Debbie’s MPF under Debbie’s MPF 2. Enter the 350 000 value of David’s MPF under David’s Registered Investments Note: Make sure that you are entering this capital under the “Assets” column, not the “Liabilities” column. 3. Enter the 1 300 000 value of the joint non-registered holdings under the Non-registered investments account 4. The 800 000 of education capital can be entered under Education Savings 5. Before we enter the information for their personal use investments, we must determine the balance of the mortgage using the Loan Calculator. To save your current work, click Calculate Click on the Home link on the top menu bar, and access the Loan Calculator from under the Calculators drop-down menu. Enter the data as follows: 1. Enter the 9 000 000 principal of the loan in the Amount Borrowed field. 2. Enter the Loan Date as two years ago on January 1st. 3. Enter the Renewal Date as the Loan Date plus 5 years, since at the end of the term the interest rate will change. Note: The Renewal Date does not always signify the end of the loan, but rather when the interest rate is liable to change, or for viewing the balance and interest paid by a particular date. 4. Enter an Interest Rate of 5.75%. 5. Click the drop down menu for the Compounding frequency and choose semi-annual. 6. Click the drop down menu beside Payment Type and choose the Blended payment option. 7. If necessary change the Frequency of Payment to the Monthly option, and the Payment amount to 55 000 8. Click on the Calculate button next to Amortization Period. The result should be roughly 26.3 years. 9. On the right of the calculator, next to the Current balance at field, the current balance of the loan will be listed. The balance of the mortgage will change depending on when you do the calculation, but should be around 8 200 000. 1. Use the Home link on the top menu, and return to the Assets & Liabilities page using the navigation panel under Client Data Entry. 2. Enter the current market value of the residence under Personal Use, and the new mortgage value under Personal Use Liabilities. 3. Review the information and then click Calculate.

Caribbean

Jamaica   Example Problem One: David has J$6 500 000 in an Retirement Investments but Debbie only has J$4 125 000 in hers. They have a Investment Account account between the two of them with J$2 500 000. They have some education capital already accumulated, valued at J$1 500 000. Their house has a current market value of J$27 000 000 , but there was a mortgage taken out against it 2 years ago for J$16 000 000. The loan is to be renewed in three years, currently with an interest rate of 5.75%. Each month they pay J$100 000 towards the loan. Solution using Summary Assets: On the Assets and Liabilities screen, the clients’ holdings will only be entered at the summary level. So, from what they told us of their assets: 1. Enter the J$4 125 000 value of Debbie’s Retirement Investments under Debbie’s Retirement Investments 2. Enter the J$6 500 000 value of David’s Retirement Investments under David’s Registered Investments Note: Make sure that you are entering this capital under the “Assets” column, not the “Liabilities” column. 3. Enter the J$2 500 000 value of the joint non-registered holdings under the Non-registered investments account 4. The J$1 500 000 of education capital can be entered under Education Savings 5. Before we enter the information for their personal use investments, we must determine the balance of the mortgage using the Loan Calculator. To save your current work, click Calculate Click on the Home link on the top menu bar, and access the Loan Calculator from under the Calculators drop-down menu. Enter the data as follows: 1. Enter the J$16 000 000 principal of the loan in the Amount Borrowed field. 2. Enter the Loan Date as two years ago on January 1st. 3. Enter the Renewal Date as the Loan Date plus 5 years, since at the end of the term the interest rate will change. Note: The Renewal Date does not always signify the end of the loan, but rather when the interest rate is liable to change, or for viewing the balance and interest paid by a particular date. 4. Enter an Interest Rate of 5.75%. 5. Click the drop down menu for the Compounding frequency and choose semi-annual. 6. Click the drop down menu beside Payment Type and choose the Blended payment option. 7. If necessary change the Frequency of Payment to the Monthly option, and the Payment amount to J$100 000 8. Click on the Calculate button next to Amortization Period. The result should be roughly 25 years. 9. On the right of the calculator, next to the Current balance at field, the current balance of the loan will be listed. The balance of the mortgage will change depending on when you do the calculation, but should be around J$14 400 000. 1. Use the Home link on the top menu, and return to the Assets & Liabilities page using the navigation panel under Client Data Entry. 2. Enter the current market value of the residence under Personal Use, and the new mortgage value under Personal Use Liabilities. 3. Review the information and then click Calculate. Trinidad and Tobago   Example Problem One: David has TT$500 000 in an Long term investment but Debbie only has TT$300 000 in hers. They have a Open investments account between the two of them with TT$200 000. They have some education capital already accumulated, valued at TT$100 000. Their house has a current market value of TT$2 000 000 , but there was a mortgage taken out against it 2 years ago for TT$1 225 000. The loan is to be renewed in three years, currently with an interest rate of 5.75%. Each month they pay TT$8 000 towards the loan. Solution using Summary Assets: On the Assets and Liabilities screen, the clients’ holdings will only be entered at the summary level. So, from what they told us of their assets: 1. Enter the TT$300 000 value of Debbie’s Long term investment under Debbie’s Long term investment 2. Enter the TT$500 000 value of David’s Long term investment under David’s Registered Investments Note: Make sure that you are entering this capital under the “Assets” column, not the “Liabilities” column. 3. Enter the TT$200 000 value of the joint non-registered holdings under the Non-registered investments account 4. The TT$100 000 of education capital can be entered under Education Savings 5. Before we enter the information for their personal use investments, we must determine the balance of the mortgage using the Loan Calculator. To save your current work, click Calculate Click on the Home link on the top menu bar, and access the Loan Calculator from under the Calculators drop-down menu. Enter the data as follows: 1. Enter the TT$1 225 000 principal of the loan in the Amount Borrowed field. 2. Enter the Loan Date as two years ago on January 1st. 3. Enter the Renewal Date as the Loan Date plus 5 years, since at the end of the term the interest rate will change. Note: The Renewal Date does not always signify the end of the loan, but rather when the interest rate is liable to change, or for viewing the balance and interest paid by a particular date. 4. Enter an Interest Rate of 5.75%. 5. Click the drop down menu for the Compounding frequency and choose semi-annual. 6. Click the drop down menu beside Payment Type and choose the Blended payment option. 7. If necessary change the Frequency of Payment to the Monthly option, and the Payment amount to TT$8 000 8. Click on the Calculate button next to Amortization Period. The result should be roughly 22.8 years. 9. On the right of the calculator, next to the Current balance at field, the current balance of the loan will be listed. The balance of the mortgage will change depending on when you do the calculation, but should be around TT$1 080 000. 1. Use the Home link on the top menu, and return to the Assets & Liabilities page using the navigation panel under Client Data Entry. 2. Enter the current market value of the residence under Personal Use, and the new mortgage value under Personal Use Liabilities. 3. Review the information and then click Calculate. Barbados   Example Problem One: David has Bds$150 000 in an Tax Sheltered Account but Debbie only has Bds$100 000 in hers. They have a Investment Account account between the two of them with Bds$60 000. They have some education capital already accumulated, valued at Bds$35 000. Their house has a current market value of Bds$625 000 , but there was a mortgage taken out against it 2 years ago for Bds$400 000. The loan is to be renewed in three years, currently with an interest rate of 5.75%. Each month they pay Bds$2 500 towards the loan. Solution using Summary Assets: On the Assets and Liabilities screen, the clients’ holdings will only be entered at the summary level. So, from what they told us of their assets: 1. Enter the Bds$100 000 value of Debbie’s Tax Sheltered Account under Debbie’s Tax Sheltered Account 2. Enter the Bds$150 000 value of David’s Tax Sheltered Account under David’s Registered Investments Note: Make sure that you are entering this capital under the “Assets” column, not the “Liabilities” column. 3. Enter the Bds$60 000 value of the joint non-registered holdings under the Non-registered investments account 4. The Bds$35 000 of education capital can be entered under Education Savings 5. Before we enter the information for their personal use investments, we must determine the balance of the mortgage using the Loan Calculator. To save your current work, click Calculate Click on the Home link on the top menu bar, and access the Loan Calculator from under the Calculators drop-down menu. Enter the data as follows: 1. Enter the Bds$400 000 principal of the loan in the Amount Borrowed field. 2. Enter the Loan Date as two years ago on January 1st. 3. Enter the Renewal Date as the Loan Date plus 5 years, since at the end of the term the interest rate will change. Note: The Renewal Date does not always signify the end of the loan, but rather when the interest rate is liable to change, or for viewing the balance and interest paid by a particular date. 4. Enter an Interest Rate of 5.75%. 5. Click the drop down menu for the Compounding frequency and choose semi-annual. 6. Click the drop down menu beside Payment Type and choose the Blended payment option. 7. If necessary change the Frequency of Payment to the Monthly option, and the Payment amount to Bds$2 500 8. Click on the Calculate button next to Amortization Period. The result should be roughly 25 years. 9. On the right of the calculator, next to the Current balance at field, the current balance of the loan will be listed. The balance of the mortgage will change depending on when you do the calculation, but should be around Bds$360 000. 1. Use the Home link on the top menu, and return to the Assets & Liabilities page using the navigation panel under Client Data Entry. 2. Enter the current market value of the residence under Personal Use, and the new mortgage value under Personal Use Liabilities. 3. Review the information and then click Calculate. Bermuda   Example Problem One: David has BD$75 000 in an Tax Sheltered Investments but Debbie only has BD$50 000 in hers. They have a Non-Tax Sheltered Investment account between the two of them with BD$30 000. They have some education capital already accumulated, valued at BD$20 000. Their house has a current market value of BD$315 000 , but there was a mortgage taken out against it 2 years ago for BD$200 000. The loan is to be renewed in three years, currently with an interest rate of 5.75%. Each month they pay BD$1 200 towards the loan. Solution using Summary Assets: On the Assets and Liabilities screen, the clients’ holdings will only be entered at the summary level. So, from what they told us of their assets: 1. Enter the BD$50 000 value of Debbie’s Tax Sheltered Investments under Debbie’s Tax Sheltered Investments 2. Enter the BD$75 000 value of David’s Tax Sheltered Investments under David’s Registered Investments Note: Make sure that you are entering this capital under the “Assets” column, not the “Liabilities” column. 3. Enter the BD$30 000 value of the joint non-registered holdings under the Non-registered investments account 4. The BD$20 000 of education capital can be entered under Education Savings 5. Before we enter the information for their personal use investments, we must determine the balance of the mortgage using the Loan Calculator. To save your current work, click Calculate Click on the Home link on the top menu bar, and access the Loan Calculator from under the Calculators drop-down menu. Enter the data as follows: 1. Enter the BD$200 000 principal of the loan in the Amount Borrowed field. 2. Enter the Loan Date as two years ago on January 1st. 3. Enter the Renewal Date as the Loan Date plus 5 years, since at the end of the term the interest rate will change. Note: The Renewal Date does not always signify the end of the loan, but rather when the interest rate is liable to change, or for viewing the balance and interest paid by a particular date. 4. Enter an Interest Rate of 5.75%. 5. Click the drop down menu for the Compounding frequency and choose semi-annual. 6. Click the drop down menu beside Payment Type and choose the Blended payment option. 7. If necessary change the Frequency of Payment to the Monthly option, and the Payment amount to BD$1 200 8. Click on the Calculate button next to Amortization Period. The result should be roughly 27.5 years. 9. On the right of the calculator, next to the Current balance at field, the current balance of the loan will be listed. The balance of the mortgage will change depending on when you do the calculation, but should be around BD$180 000. 1. Use the Home link on the top menu, and return to the Assets & Liabilities page using the navigation panel under Client Data Entry. 2. Enter the current market value of the residence under Personal Use, and the new mortgage value under Personal Use Liabilities. 3. Review the information and then click Calculate. Bahamas   Example Problem One: David has B$75 000 in an Tax Sheltered Investments but Debbie only has B$50 000 in hers. They have a Non-Tax Sheltered Investments account between the two of them with B$30 000. They have some education capital already accumulated, valued at B$B20 000. Their house has a current market value of B$315 000 , but there was a mortgage taken out against it 2 years ago for B$200 000. The loan is to be renewed in three years, currently with an interest rate of 5.75%. Each month they pay B$1 200 towards the loan. Solution using Summary Assets: On the Assets and Liabilities screen, the clients’ holdings will only be entered at the summary level. So, from what they told us of their assets: 1. Enter the B$50 000 value of Debbie’s Tax Sheltered Investments under Debbie’s Tax Sheltered Investments 2. Enter the B$75 000 value of David’s Tax Sheltered Investments under David’s Registered Investments Note: Make sure that you are entering this capital under the “Assets” column, not the “Liabilities” column. 3. Enter the B$30 000 value of the joint non-registered holdings under the Non-registered investments account 4. The B$B20 000 of education capital can be entered under Education Savings 5. Before we enter the information for their personal use investments, we must determine the balance of the mortgage using the Loan Calculator. To save your current work, click Calculate Click on the Home link on the top menu bar, and access the Loan Calculator from under the Calculators drop-down menu. Enter the data as follows: 1. Enter the B$200 000 principal of the loan in the Amount Borrowed field. 2. Enter the Loan Date as two years ago on January 1st. 3. Enter the Renewal Date as the Loan Date plus 5 years, since at the end of the term the interest rate will change. Note: The Renewal Date does not always signify the end of the loan, but rather when the interest rate is liable to change, or for viewing the balance and interest paid by a particular date. 4. Enter an Interest Rate of 5.75%. 5. Click the drop down menu for the Compounding frequency and choose semi-annual. 6. Click the drop down menu beside Payment Type and choose the Blended payment option. 7. If necessary change the Frequency of Payment to the Monthly option, and the Payment amount to B$1 200 8. Click on the Calculate button next to Amortization Period. The result should be roughly 27.5 years. 9. On the right of the calculator, next to the Current balance at field, the current balance of the loan will be listed. The balance of the mortgage will change depending on when you do the calculation, but should be around B$180 000. 1. Use the Home link on the top menu, and return to the Assets & Liabilities page using the navigation panel under Client Data Entry. 2. Enter the current market value of the residence under Personal Use, and the new mortgage value under Personal Use Liabilities. 3. Review the information and then click Calculate. Puerto Rico   Example Problem One: David has $80 000 in an Retirement Investment but Debbie only has $50 000 in hers. They have a Open Investment account between the two of them with $30 000. They have some education capital already accumulated, valued at $18 000. Their house has a current market value of $325 000 , but there was a mortgage taken out against it 2 years ago for $20 0000. The loan is to be renewed in three years, currently with an interest rate of 5.75%. Each month they pay $1 250.04 towards the loan. Solution using Summary Assets: On the Assets and Liabilities screen, the clients’ holdings will only be entered at the summary level. So, from what they told us of their assets: 1. Enter the $50 000 value of Debbie’s Retirement Investment under Debbie’s Retirement Investments 2. Enter the $80 000 value of David’s Retirement Investment under David’s Registered Investments Note: Make sure that you are entering this capital under the “Assets” column, not the “Liabilities” column. 3. Enter the $30 000 value of the joint non-registered holdings under the Non-registered investments account 4. The $18 000 of education capital can be entered under Education Savings 5. Before we enter the information for their personal use investments, we must determine the balance of the mortgage using the Loan Calculator. To save your current work, click Calculate Click on the Home link on the top menu bar, and access the Loan Calculator from under the Calculators drop-down menu. Enter the data as follows: 1. Enter the $20 0000 principal of the loan in the Amount Borrowed field. 2. Enter the Loan Date as two years ago on January 1st. 3. Enter the Renewal Date as the Loan Date plus 5 years, since at the end of the term the interest rate will change. Note: The Renewal Date does not always signify the end of the loan, but rather when the interest rate is liable to change, or for viewing the balance and interest paid by a particular date. 4. Enter an Interest Rate of 5.75%. 5. Click the drop down menu for the Compounding frequency and choose semi-annual. 6. Click the drop down menu beside Payment Type and choose the Blended payment option. 7. If necessary change the Frequency of Payment to the Monthly option, and the Payment amount to $1 250.04 8. Click on the Calculate button next to Amortization Period. The result should be roughly 25 years. 9. On the right of the calculator, next to the Current balance at field, the current balance of the loan will be listed. The balance of the mortgage will change depending on when you do the calculation, but should be around $180 000. 1. Use the Home link on the top menu, and return to the Assets & Liabilities page using the navigation panel under Client Data Entry. 2. Enter the current market value of the residence under Personal Use, and the new mortgage value under Personal Use Liabilities. 3. Review the information and then click Calculate.

Visit the Currency Legend if you are unsure of what a currency symbol represents.

Note: Images display Canadian figures.

Go to the exercise to test your knowledge on entering summary levels assets.

Click here to return to the Financial Management Workbook.