James has recently become eligible for the Age Pension. He has the following assets and...
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Finance
James has recently become eligible for the Age Pension. He has the following assets and liabilities as at 1 July 2018:
Details
Amount ($)
Personal residence
510,000
Funeral bonds
40,000
Motor vehicle
10,000
Household and personal effects
22,000
Holiday home
240,000
Term deposit at 1.50%
60,000
Share portfolio at 5.50%
30,000
Debentures at 3.00%
20,000
Jewellery
35,000
Personal loan on Motor vehicle
2,000
Mortgage on Personal residence
150,000
Superannuation
100,000
He is not drawing any amount from the superannuation fund. On 1 August 2018, he decided to gift one of his relatives $10,000. He also decided to take a part-time job with his local art dealer and expects to earn $150 per week.
James has come to see you for advice on 3 August 2019 for his Age Pension entitlement.
Required:
Calculate James assessable assets and financial assets. (7 marks)
Calculate James Age Pension entitlement. (8 marks)
Calculate James total gross income from all sources on annual basis. (4 marks)
Discuss any legal strategies that you can suggest to assist James to maximise his pension entitlement. (3 marks)
Answer & Explanation
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