Financial Responsibility and Decision Making BUDGETING

The Financial Planning Process

What is Financial Planning? A thought process based on what each person considers most important – based on the following questions: What do you want to do in life? What do you want to do in life? What do you want to be, do and have? What do you want to be, do and have? A financial plan helps us to identify the end result we want, figure out how to get there and stay on track to achieve it.

Do you NEED it or do you WANT it? Needs are the very basic things needed for survival POLARITY ACTIVITY Wants are the things that make life more interesting and fun, by you could live without them if you had to.

What’s the deal with NEEDS and WANTS? Because resources are often limited, we must distinguish between our NEEDS and WANTS to be able to prioritize our goals. NEEDS come first, WANTS motivate us to succeed

Delayed Gratification Delayed Gratification is the act of having to wait to enjoy something and incorporates careful planning. Discussion: What are the benefits of delayed gratification?

Values Beliefs and practices in your life that are important to you Beliefs and practices in your life that are important to you Influenced by: family, friends, your religion, things you read and experiences you have Influenced by: family, friends, your religion, things you read and experiences you have May change throughout life as you learn and do new things May change throughout life as you learn and do new things Have a huge influence on your goals Have a huge influence on your goals

Goals Something for which you aim Something for which you aim Something you want to be, do or have at some time in the future Something you want to be, do or have at some time in the future Points you in the direction you need to take Points you in the direction you need to take

Financial Planning Process Set SMART Goals Analyze Information Create a Plan Implement the Plan Monitor and Modify the Plan

S-M-A-R-T Goal Criteria Specific Measurable Attainable Realistic Time-limited

Analyze Information Find out where your finances stand Find out where your finances stand Where money is coming from Where money is coming from How much money you are spending How much money you are spending Any debts you’ve incurred from borrowing Any debts you’ve incurred from borrowing Have a direct impact on your ability to achieve your financial goals Have a direct impact on your ability to achieve your financial goals

Being a Responsible Spender Money should be handled wisely, respectfully, and responsibly Money should be handled wisely, respectfully, and responsibly Take personal responsibility for your decisions and actions Take personal responsibility for your decisions and actions Keep your goals in mind when spending money Keep your goals in mind when spending money

Creating a Plan Based on making important decisions Based on making important decisions Many things may affect your decisions: your mood, values, culture, habits, and opinions of your friends and parents Many things may affect your decisions: your mood, values, culture, habits, and opinions of your friends and parents Every decision, easy or hard, is subjected to a six-stage decision making process Every decision, easy or hard, is subjected to a six-stage decision making process

Decision Making Activity

Decision Making Process Identify your SMART Goal Establish your Criteria Examine your Options Weigh the Pros and Cons Make your decision Evaluate Results

Creating and Implementing your Plan Write your goals on an index card or find pictures and post them to serve as a constant reminder of your goal Write your goals on an index card or find pictures and post them to serve as a constant reminder of your goal If you are going out and will be spending money limit the amount you spend by only taking a fixed amount If you are going out and will be spending money limit the amount you spend by only taking a fixed amount

Some things to remember when talking about money… Remember that individual values, attitudes, and goals influence money behaviours Remember that individual values, attitudes, and goals influence money behaviours Take ownership of your own money, decisions and attitudes Take ownership of your own money, decisions and attitudes Take responsibility for the consequences of your financial decisions Take responsibility for the consequences of your financial decisions

Monitoring and Modifying your Plan Review your plan and progress at regular intervals Review your plan and progress at regular intervals This allows you to catch yourself if you stray off course This allows you to catch yourself if you stray off course Remember that your plan is not set in stone Remember that your plan is not set in stone Your plan should change as your life changes Your plan should change as your life changes Be sure to review your plan when major changes occur in life Be sure to review your plan when major changes occur in life

Monitoring and Modifying Activity