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Bill and Suzie are now both thirty, married, with one child, and Suzie is home with the baby. They are earning $60,000 per year, are full tithe payers, have adequate health and life insurance, are out of credit card and consumer debt, and have an investment plan. They are aggressive investors, want three months income as an emergency fund, and have determined their asset classes and investment benchmarks as 75 percent equities and 25 percent bonds and cash with targets:

25% bonds/cash (Lehman Aggregate) 25% T, 0% R

55% U.S. (S&P 500 Index) 35% T, 20% R

10% small cap (Russell 5000 Index) 4% T 6% R

10% international (MSCI EAFE Index) 4% T 6% R

Application

How should Bill and Suzie build their portfolio?

 

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