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Question What type of policy should James and Joanne consider covering the diamond wedding ring?

Question What type of policy should James and Joanne consider covering the diamond wedding ring?

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question What type of policy should James and Joanne consider covering the diamond wedding ring?
PLEASE ANSWER THIS QUESTION !!I Newlyweds Joanne and James have had several milestones in the past year. They are newlyweds, recently purchased their first home and now bave twins on the way! Joanne and James have to seriously consider their insurance needs. A family, a home and now babies on the way, they need to develop a risk management plan to help them should an unexpected event arise. Current Financial Situation: Assets (Joanne and James combined): Checking account Savings Account $4,300 $22,200 $20,500 $26,000 Emergency Fund savings account Retirement Account balance $10,000(JOANNE) $18,000(JAMES) Car Liabilities (Joanne and James combined): $2,000 $2,000 $6,000 Student loan balance Credit Card Balance Car Loans Income: JOANNE : $50,000 gross income ($37,500 net income after taxes) JAMES:$75,000 gross income ($64,000 net income after taxes) Monthly Expenses (Joanne and James combined): $1,252 Mortgage $500 Property Taxes and Insurance $195 Utilities $400 Food Gas/Maintenance $275 Credit Card Payment $250 Car Loan Payment $289 Entertainment $300 1. Joanne and James decided to conduct a check-up on their homeowner's insurance policy. They noticed that they had omitted covering Joanne's diamond wedding band set from their policy. What if it got lost or stolen? It was a major purchase and beside the emotional value, the cost to replace the diamond jewellery would be very high. 2. What type of policy should Joanne and James consider covering the diamond wedding rings? 3. What financial strategy would you suggest to Joanne and James to enable them to save money on their insurance premiums?
Transcribed Image Text:PLEASE ANSWER THIS QUESTION !!I Newlyweds Joanne and James have had several milestones in the past year. They are newlyweds, recently purchased their first home and now bave twins on the way! Joanne and James have to seriously consider their insurance needs. A family, a home and now babies on the way, they need to develop a risk management plan to help them should an unexpected event arise. Current Financial Situation: Assets (Joanne and James combined): Checking account Savings Account $4,300 $22,200 $20,500 $26,000 Emergency Fund savings account Retirement Account balance $10,000(JOANNE) $18,000(JAMES) Car Liabilities (Joanne and James combined): $2,000 $2,000 $6,000 Student loan balance Credit Card Balance Car Loans Income: JOANNE : $50,000 gross income ($37,500 net income after taxes) JAMES:$75,000 gross income ($64,000 net income after taxes) Monthly Expenses (Joanne and James combined): $1,252 Mortgage $500 Property Taxes and Insurance $195 Utilities $400 Food Gas/Maintenance $275 Credit Card Payment $250 Car Loan Payment $289 Entertainment $300 1. Joanne and James decided to conduct a check-up on their homeowner's insurance policy. They noticed that they had omitted covering Joanne's diamond wedding band set from their policy. What if it got lost or stolen? It was a major purchase and beside the emotional value, the cost to replace the diamond jewellery would be very high. 2. What type of policy should Joanne and James consider covering the diamond wedding rings? 3. What financial strategy would you suggest to Joanne and James to enable them to save money on their insurance premiums?
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