CASE ANALYSIS : QUILICI FAMILY

BY
SANJAY O S
SUSHILKUMAR H BALVIR
RAJAN DOSHI
ROHAN MOON
KULDIP R
PANKAJ
 Case analysis : Quilici family
• Nuclear family of Greg and Debra and their son Brady.
• Greg’s earning is $85000 per annum.
• Concerned about Brady’s education whose age is 5 years.
• Planning for either Stanford or north Carolina university after
Brady is 18.
• Worried about higher education and living expenses at either
of the university.
• It is assumed 5% increase in tuition fee and 3% increase in
living expense.
• Both are planning to increase their savings for their son’s
future.
• For this they met there family financial planner and decided
to invest in mutual fund at assumed 12% annual growth.
MONEY FLOW DIAGRAM FOR MONTHLY SAVINGS (FUTURE VALUE)

1 2 3 4 n-1 n
R% R% R% . . . R%

I I I I I
 INFLATED AMOUNT

INFLATED AMOUNT :

Ia =
 Question 1
Stanford university:
FV=R( PVIFi,n)
1st year=( FV0)=20000* ( PVIF5%,13)+6000* ( PVIF3%,13)
=37713+8811=$46524
2nd year=( FV1)=20000* ( PVIF5%,14)+6000* ( PVIF3%,14)
=39599+9076=$48675
3rd year= ( FV2)=20000*( PVIF5%,15)+6000* ( PVIF3%,15)
=41579+9348=$50927
4th year= ( FV3)=20000*( PVIF5%,16)+6000* (PVIF3%,16)
=43657+9628=$53285
North Carolina:
1st year=( FV0)=2500* ( PVIF5%,13)+6000* ( PVIF3%,13)
=4714+8811=$13525
2nd year=( FV1)=2500* ( PVIF5%,14)+6000* ( PVIF3%,14)
=4950+9076=$14025
3rd year= ( FV2)=2500*( PVIF5%,15)+6000* ( PVIF3%,15)
=5197+9348=$14545
4th year= ( FV3)=2500*( PVIF5%,16)+6000* ( PVIF3%,16)
=5457+9628=$15085
Question 1
North
Carolina
University
Question 1
Stanford
University
 Question 2
Stanford university:
FV=R( PVIFi,n)
1st year=( FV0)=20000* ( PVIF5%,13)+6000* ( PVIF3%,13)
=37713+8811=$46524
2nd year=( FV1)=20000* ( PVIF5%,14)+6000* ( PVIF3%,14)
=39599+9076=$48674
3rd year= ( FV2)=20000*( PVIF5%,15)+6000* ( PVIF3%,15)
=41579+9348=$50926
4th year= ( FV3)=20000*( PVIF5%,16)+6000* (PVIF3%,16)
=43657+9628=$53286
TOTAL EXPENSE=$199410
North Carolina:
1st year=( FV0)=2500* ( PVIF5%,13)+6000* ( PVIF3%,13)
=4714+8811=$13525
2nd year=( FV1)=2500* ( PVIF5%,14)+6000* ( PVIF3%,14)
=4950+9076=$14025
3rd year= ( FV2)=2500*( PVIF5%,15)+6000* ( PVIF3%,15)
=5197+9348=$14545
4th year= ( FV3)=2500*( PVIF5%,16)+6000* ( PVIF3%,16)
=5457+9628=$15085
TOTAL EXPENCE= $57181
 CALCULATION FOR MONTHLY SAVINGS

FVAn =

Where n=155
R = monthly deposit
FVAn = Final Value of Annuity
Question 3: Stanford University

The amount needed at the start of 1st year is $168510.

Monthly deposit can be found out by annuity.

FVAn=

168510=R[(1.01)155+(1.01)154+….+(1.01)1+(1.01)0]
168510=R(372.21)
R= $452.73 ~ $453 (The amount to be deposited monthly)
Question 3: North Carolina University

The amount needed at the start of 1st year is $48380. Monthly

deposit can be found out by annuity.

FVAn=

48380=R[(1.01)155+(1.01)154+….+(1.01)1+(1.01)0]
48380=R(372.21)
R= $129.98 ~ $130 (The amount to be deposited monthly)
Question 4: Stanford University

The amount needed at the start of 1st year is $172896. Monthly

deposit can be found out by annuity.
FVAn=

172896=R[(1.01)155+(1.01)154+….+(1.01)1+(1.01)0]
172896=R(317.95)
R= $543.78 ~ $544 (The amount to be deposited monthly)
Question 4: North Carolina University

The amount needed at the start of 1st year is $49599. Monthly

deposit can be found out by annuity.
FVAn=

49599=R[(1.01)155+(1.01)154+….+(1.01)1+(1.01)0]
49599=R(317.95)
R= $155.99 ~ $156 (The amount to be deposited monthly)
 Question 5
• North Carolina University:
• The amount deposited by the parents for tuition fee and living
expenses is
$130*156(months)= $20280
Where total tuition fee and living expenses are $57181.
• Stanford University:
• The amount deposited by the parents for tuition fee and living
expenses per month is
$453*156(months)= $70668
Where total tuition fee and living expenses are $199410.
THANK YOU