Unit 1B - Your Financial Plan: Where It All Begins

“Most people don’t plan to fail… They simply fail to plan!”

The Five-Step Financial Planning Process 1-B

Sample Wants and Needs NEEDS Food for breakfast Clothes for school Transportation to school or work ______________ WANTS An iPOD DVD Players Cell Phone Hot Car ______________ 1-C

Values Getting a good education Religious faith or beliefs Social causes Handling money responsibly Friendships / The people I hang out with ____________________________ 1-D

Goals You can’t hit a target you cannot see. The basic rules: Goals must be written down Realistic plans must be made for their accomplishment Deadlines must be set and honored

Goals Goal setting is an art that makes everything else possible. Most successful people are obsessive goal setters. Once you have goals set, you have a pattern for opportunity

Goals Successful people have a perfect balance between thought and action You must think before you act but you have to act Don’t be afraid to take a risk

Goals Failure is inevitable It just should not be linked with giving up How many chances do you give a baby to walk before you stop them from trying?

Goals Problem with achieving goals is that we fall apart once we achieve our goal example: dieting Rewards of goal setting come not from earning $1 million but in having learned the lessons about what it takes to become a millionaire

Term Goals Within three months Three months to a year More than a year SHORT-TERM GOALS Within three months INTERMEDIATE-TERM GOALS Three months to a year LONG-TERM GOALS More than a year 1-E

Delayed Gratification Saving money over time to make a major purchase. Waiting to buy a new product until the price goes down. Waiting to see the latest movie until the crowds get smaller and the lines shorter. ____________________________________________________________________ 1-F

S-M-A-R-T GOAL CRITERIA Specific Measurable Attainable Realistic Time-Limited 1-G

Specific…….. Measurable… Attainable….. Realistic……. Time-Limited.. SMART Goals Specific…….. “Pay for lodging, transportation, meals for a 5-day trip to Washington, D.C.” Measurable… “$300 through fundraising, $50 from birthday money, save $25 a week.” Attainable….. “If I stick to my plan, I’ll have the money when I need it.” Realistic……. “I still have enough money to live on while I work toward this goal.” Time-Limited.. “I need to have all the money by 6 months from now.” 1-H

Spending Record $6.00 $35.00 $4.00 $7.00 $5.00 $8.00 $15.00 $15.00 $55.00 $40.00 $15.00 1-I

Factors That Affect Decision Making Age Factors That Affect Decision Making Needs Wants What about you? Family Culture Time Society Motivation Money Values Education Habits Attitudes 1-J

Decision-Making Process Identify Your Goal Establish Criteria Weigh Pros and Cons Make a Decision Evaluate Results 1-K

The Decision- Making Process NEFE High School Financial Planning Program Unit One - Your Financial Plan: Where It All begins Decision Making and Financial Planning The Decision- Making Process The Financial Planning Process Evaluate Results Make a Decision Identify Your Goal Weigh Pros and Cons Establish Criteria Monitor & Modify the Plan Implement Set Goals Create a Plan Analyze Information 1-L

Know What You Want Identify Your Goal Decide where to eat Establish Criteria 1. 2. 3. 1-M

REALITY RESPONSIBILITY RESTRAINT 1-N

SAVING SPENDING SHARING 1-O

Unit 1: Your Financial Plan: Where it All Begins