We would like to begin by way of c...

We would like to begin by way of commending Joan and Jack (not their real names) for their disciplined approach to saving. The following suggestions are tendered to help them plan for their retirement (within brace years).

Their current income ($4950 by month) covers the couple's basic expenditures (estimated at $1,333 per month) And equable after they retire, their pensions ($2100 by month) should continue to take care of these sumptuousnesss However, in addition to their basic costs Joan and Jack also have to disquiet themselves with the following:

* their son's education charges ($7,000 per year for the nearest two years)

* unpredictable emergencies

* vacations, entertainment, etc

* RRSP contributions

ASSET ALLOCATION

After paying the bills, Joan and Jack are left with about $3600 in discretionary standard of value each month for extra costs and investments.

Since Joan and Jack are conservative investors, we commend they divide their discretionary income in the following way: 3S% cash, 40% fixed income, and 25% equities.

Cash

Sticking to these guidelines, the cash portion of their discretionary income would amount to $15000 within a year. This should be used to make secure they are covered for the following items:

* Their son's education costs Jack and Joan will ne to exhaust $7,000 next year. The following year, they will ne at least $7000 and with inflation, that number would be more like $7500 detain i