Investment Policy Statement for Mrs. Thompson

As a financial advisor, you are tasked with preparing an Investment Policy Statement (IPS) for a high-net-worth client, Mrs. Thompson, who is 60 years old and near retirement. Mrs. Thompson has a net worth of $10 million, primarily in a mix of equities and fixed income. Her income needs are significant due to ongoing medical expenses, and she is risk-averse with a strong preference for capital preservation.

Mrs. Thompson has stated her primary goal is to generate a sustainable income stream for her retirement while maintaining her principal. Additionally, she wants to allocate a portion of her portfolio to charitable giving, as philanthropy is important to her. She has no dependent children and wishes to leave a substantial legacy to her favorite charities.

In preparing the IPS, you need to outline the investment objectives, risk tolerance, asset allocation strategy, and any specific guidelines pertinent to her income needs and philanthropic goals.