medium · Certified Financial Planner Estate Planning
Mr. and Mrs. Ruiz, both aged 45, have just inherited 800,000 from a distant relative. They currently have45,000 in credit card debt at 21% interest, no disability insurance, and a $5,000 emergency fund. They ask you to recommend an aggressive equity portfolio for the inheritance.
According to the CFP Mindset hierarchy, what is your first action?
- Implement a diversified portfolio of low-cost index funds to maximize the long-term growth of the windfall.
- Recommend they use a portion of the inheritance to pay off the 21% credit card debt immediately.
- Calculate the required savings rate to reach their retirement goal using the new $800,000 balance.
- Gather additional qualitative and quantitative data regarding their monthly cash flow and coverage needs.
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