PLANNING FOR HIGHER EDUCATION AND RETIREMENTS:
JOHN & ALICIA WALLACE’S CASE
Chan H. Lee, Minnesota State University, Mankato
Paul (39) and Alicia (34) have been married for eight years and have on child, Megan
(4). They live in a middle-income neighborhood in Corpus Christi, Texas. Alicia graduated
with a B.A. in Spanish from Holy Cross College in Worchester, MA and later obtained her master’s degree in Spanish from the University of Houston. She has worked as a teacher for
the past nine years and expects to earn approximately $40,000 this year. Alicia would like to
explore opportunities to teach college level classes which would increase her family income.
Paul is a first generation immigrant from a country in Central America. Since he
arrived in the United States approximately ten years ago, he has worked mainly in
construction firms. After their marriage, Paul went to a community college where he studied
the heating/air conditioning field. Upon his graduation, he was employed by a national
company, earning approximately $60,000 for the first few years. However, due to the recent
weak economy, his earnings were reduced to approximately $40,000 annually. Paul would like
to have his own business in the field.
They would like to send their daughter at private college. If Megan desires to pursue
advanced degrees, Paul and Alicia are preparing to provide any financial help that she might
need. The Wallace’s have been anxious to learn more about the feasibility of achieving their
daughter’s college education and financially securing their retirements. Megan inherited 2000
shares of Syco stocks with the current market value of some $110,000. Paul has been
deducting 10% of his earning to build his 401 (K).
This case was prepared by Chan H. Lee, Minnesota State University, Mankato, and is intended to be used for class discussion rather than to illustrate either effective or ineffective handling of the situation.
Presented to and accepted by the North American Case Research Association (NACRA) for its annual meeting, November 2003, Tampa, Florida. All rights reserved to the author and NACRA. © 2003 by Chan H. Lee.