INVESTMENT POLICY STATEMENT
Lawrence Thompson, 60 years old recently retired and received a $5M cash payment from his employer as an early retirement incentive. He also obtained $800,000 by exercising his company stock options. Both amounts are net of tax. Thompson is not entitled to a pension; however, his medical expenses are covered by insurance paid for by his former employer. He is in excellent health and has a normal life expectancy.
Thompson has no assets other than the $5.8 million cash referenced above, and he has no debts. Thompson’s living expenses will be $200,000 per month and will rise with inflation. He does not plan to work again.
Prepare an Investment Policy Statement for Lawrence that suits his needs based on the information provided above.
Prepare a spreadsheet outlining the particulars in preparing this statement may use real existing entities to do your asset allocation and for buying and selling of securities).
Provide a word document and excel spreadsheet in accordance with the work done. An example of the spreadsheet is provided.
