Essentials of Personal Financial Planning

CHAPTER 20 APPLICATIONS IN EMPLOYEE BENEFITS PLANNING

CASE STUDY

Willis and Katherine Adams just moved to the community because of new jobs: Willis was recruited to lead a new call center for one of the major appliance manufacturers; Katherine just completed nursing school and was hired by the regional hospital. Both employers are large (with over 100 employees) and well-established companies offering above-average salaries, but the real attraction was the outstanding employee benefit packages. Willis and Katherine were eager to take full advantage of the benefits available to them—and with good reason. Willis’s mother is 68 and has early onset dementia. Unable to afford any residential options for her, the Adamses have opted to have Willis’s mother live with them. She is listed as a dependent on their Form 1040 because she is without resources and does not qualify for Social Security benefits. While Katherine was in nursing school, she was the primary caregiver for Willis’s mother, but now that Katherine has a full-time job, the Adamses have hired an in-home care provider. Currently, they anticipate about $10,000 per year of adult day care expenses.

The Adamses purchased a beautiful house big enough for them and Willis’s mother. They have the house of their dreams, but between the house purchase and the costs of adult care, they are feeling a bit of a cash flow pinch. Exacerbating ...