Winner #31 Edwin Beale

Edwin Beale must decide whether to pursue an M.B.A., buy a second house, or both

problems restructuring under difficult economic conditions.”

In particular, Clark recommends that Beale add the $2,000 prize money to his Roth IRA. “Within that account,” he says, “I would recommend investing the money in small- and mid-cap growth funds. The Roth IRA allows tax-free growth and tax-free withdrawals of earnings.” Tax-free earnings can’t be withdrawn from a Roth IRA until after age 591/2. By that time, if all goes according to plan, Beale will have had a prosperous executive career and need even more tax shelter.

Financial Snapshot: Edwin Beale

HOUSEHOLD INCOME

Base salary  $53,000
Total*  $53,000

ASSETS

Market value of home  $107,000
401(k 22,000
Brokerage account  4,800
Roth IRA  1,250
Savings  1,100
Total  $136,150

LIABILITIES

Mortgage balance  $69,000
Credit card debt  2,000
Other debt  1,100
Total  $72,100
Net Worth*   $64,050
*Does not include possible bonuses

 

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