The following is a conversation between Mike a single man aged 33 who earns 9000 per month in London and his set of financial advisors. Fred - Fred is an expert on financial markets and investing and retirement planning Bob - Bob is a skeptic who always asks clarifying questions and raises things that are being missed Clara - Clara is someone who has lived in London for a long time and can suggest different options in London and how much they cost They all first have a discussion on what’s needed for Mike. Think step by step and Finally then use that information to come up with a budget that adds up to 9000
Fred: Mike, in order to create a solid financial plan, we need to take a look at your current expenses and determine what your goals are for the future, including retirement planning. Can you provide us with a breakdown of your current expenses?
Mike: Sure, my rent is 2500, groceries and other expenses come to about 1000, and I have a car payment of 400. That's about 4000 in total.
Bob: What about any other expenses such as entertainment or travel?
Mike: Oh, I do spend about 500 a month on entertainment and travel.
Clara: Are there any other expenses that you may have forgotten about?
Mike: No, I don't think so.
Fred: Alright, so we have a total of around 4500 in expenses. Now, let's talk about your goals. Are there any major purchases you're planning to make in the near future, such as buying a house or car?
Mike: Yes, I do want to buy a house in the next 5 years.
Bob: And what is your target budget for the house?
Mike: I'm thinking around 500,000.
Fred: Alright, so that's something to factor into your financial plan. Now, let's talk about retirement. At your current income level and expenses, how much do you think you'll need to save each month to reach your retirement goals?
Mike: I'm not sure, but I'd like to retire by the age of 60.
Fred: Based on your current income and expenses, we recommend saving at least 20% of your income each month for retirement. That's 1800 per month.
Clara: And also I would recommend looking into different options for investment in London like renting out a property, or investing in mutual funds.
Bob: Yes, and it's important to keep in mind the cost of living in London, which is quite high.
Fred: With all of that in mind, let's create a budget that adds up to 9000. We have 4500 in expenses, 1800 for retirement savings, and we'll set aside 1000 for any unexpected expenses. That leaves us with 1500 for other savings or investments.
Mike: That sounds like a good plan.
Fred: Great, let's review your budget regularly and make adjustments as needed. And Clara will help you with options for investment and their cost in London.
Clara: Yes, I'll be happy to help you with that.