Late one Saturday night, after cruising home in the Ferrari from a superb dinner at their favourite Toorak restaurant, Monique and William Howard have a serious discussion. 'I just can't understand where all the money goes,' says Monique, as she sips some specially imported French champagne that they discovered on their last annual European holiday. 'It's got me beat,' replies William, as he finishes off a mouthful of vintage port and slips a CD into their brand new Bose entertainment system. This conversation is becoming increasingly common in the Howards' household. William has worked his way up the ladder in a well-known city accounting practice, and has just been promoted to a junior partner position on a $350,000 per annum package. Monique is a sculptor, with two successful exhibitions, and recently received requests for two commissioned works for which she will receive $20,000 each. On average, her total annual income in any one year is approximately $750,000. However, William and Monique have found their lifestyle has adapted to their rising income at an alarming rate. Monique used to buy dresses at chain-store sales, but now finds in her mid-30s that, to be a successful artist in the Toorak district, she needs to maintain an image and hence only wears designer clothes. William prefers to wear pure wool suits styled in Italy. Soon after William's promotion, the couple moved into their current home in Toorak. They have $800,000 owing on the mortgage. Their two children, two-year-old Maddison and four-year-old Thorn, are in preschool four days a week, amounting to $640 per week. William and Monique expect the fees to increase in coming years with their children attending private schools and they have agreed to finance their children's university education, which should amount to $35,000 each. William is in his mid-30s, works incredibly hard and compensates for his absence with extravagant gifts for his family and weekends at a resort in the Yarra Valley. Monique likes her fast lifestyle but has started to worry about the future, and about William, who has lost that 'zing' he had in his 20s. Monique estimates that they have saved nothing over the past two years. Until now, they have thought that William's superannuation will be enough - William's company contributes an extra 10% on top of his salary to the superannuation fund and he salary sacrifices an additional $20,000 per year. However, his youngest brother, aged 31, has just been diagnosed with a hereditary bone disease that will see him in a wheelchair by the age of 40. Concerned, William recently visited his brother's specialist who confirmed that William is carrying the same defective gene and is likely to succumb to the same diagnosis. Except for the family home and the superannuation, the Howard family have no investments, apart from holdings in an ethical investment trust (mostly green investments in sustainable timber forests). They geared into the investment in a bid to reduce their tax liability. Unfortunately, the trust has been performing poorly since the global financial crisis, which has resulted in negative returns of -10% and -12% over the last two years. To add insult to injury, the Australian Taxation Office is reviewing the eligibility of any tax deduction William claimed on the $250,000 he borrowed to buy the units.

William and Monique have come to you seeking advice. Analyse their current situation and the problems they currently face.