1. PERSONAL FINANCIAL PLANNING

2. OBJECTIVE
To know the importance of Personal
Financial Planning.

3. OVERVIEW ☺Advantage of Personal Financial Planning
☺Adult Life Cycle Financial Plan
☺Steps in Financial Planning Process
☺Components of Personal Financial Planning

4. PERSONAL FINANCIAL PLANNING
IS THE ART AND SCIENCE OF PUTTING YOUR MONEY TO WORK FOR YOU AND LIVING WITHIN YOUR MEANS.

5. IT IS THE PROCESS OF DECIDING
HOW TO OBTAIN, PROTECT
AND USE THESE RESOURCES.

6. THROUGHOUT LIFE, EACH INDIVIDUAL AND FAMILY HAS NEEDS THAT CAN BE SATISFIED BY THE INTELLIGENT USE OF FINANCIAL RESOURCES.

7. ADVANTAGES OF PERSONAL FINANCIAL PLANNING

8. 1. ENHANCES THE QUALITY OF YOUR LIFE.

9. 2. HELPS FOSTER A SENSE OF
WELL - BEING AND SATISFACTION.

10. 3. INCREASES CONTROL OF FINANCIAL
AFFAIRS. P

11. 4. IMPROVES FAMILY RELATIONSHIPS.

12. INSTILL SENSE OF FREEDOM
FROM FINANCIAL WORRIES. S P

13. 6. INCREASED EFFECTIVENESS IN
OBTAINING, USING, AND PROTECTING
RESOURCES THROUGHOUT THE
ADULT LIFE CYCLE.

14. ADULT LIFE CYCLE FINANCIAL PLAN

15. The adult life cycle is the stage that an individual goes through based on age, financial needs and family situation.

16. AGE 18 – 24
Train for career.
Establish household and
attain financial independence.
Develop a saving and
investment plan.
Purchase insurance.
Create effective financial record
keeping and planning system.
Make will.

17. AGE 25 – 34
Provide for expanding housing needs and living costs.
Expand career goals.
Manage increased needs for credits.
Purchase additional insurance coverage.

18. AGE 35 – 44
Upgrade career training.
Maximize protection for major income
earners.
Establish and work towards retirement
goals.
Provide greater income for expanding
needs.

19. AGE 45 – 54
Maximize investment
Evaluate and update retirement plan
Analyze and adjust investment plan as needed
Evaluate future financial needs of parents or other dependents

20. AGE 55 – 64
Consolidate financial assets.
Plan for part time or volunteer work
during retirement.
Investigate housing location and expenses for retirement.

21. AGE 65 AND OVER Adjust living conditions and spending
based on health and income.
Obtain assistance with managing financial affairs.
Finalize estate plan.

22. STEPS IN FINANCIAL PLANNING PROCESS

23. Analyze your current personal and
family situation. ? ?

24. 2. DEVELOP FINANCIAL GOAL.
- Determine where would you like to be?

25. CREATE A FINANCIAL PLAN FOR ACTION
DEVELOP A PLAN FOR ACTION OF ACHIEVING YOUR GOALS.

26. B A N K YOU WILL NEED A SPECIFIC PLAN TO FOLLOW.
FOR EXAMPLE , INCREASES IN SAVING
MAY BE ACHIEVED BY REDUCING
SPENDING OR BY INCREASING INCOME
THROUGH EXTRA TIME IN THE JOB.
B A N K
OVERTIME

27. 4. IMPLEMENT THE FINANCIAL PLAN
ALL YOUR EFFORTS SHOULD BE GEARED TO AVOID THE MANY FINANCIAL MISTAKES THAT ARE MADE BY INDIVIDUALS AND FAMILIES.

28. FINANCIAL MISTAKES ! ! !

29. FINANCIAL MISTAKES NOT SETTING FINANCIAL GOALS.
MAKING AN UNREALISTIC BUDGET.
MAINTAINING POORLY FINANCIAL
RECORD
5. USING CREDIT UNWISELY.

30. NOT HAVING ENOUGH INSURANCE
FOR HOUSE AND VALUABLES.
NOT HAVING AN EMERGENCY
SAVINGS FUND.

31. 8. MAKING MAJOR FINANCIAL
DECISIONS WITHOUT PROFESSIONAL HELP
9. MAKING SPUR-OF-THE-MOMENT INVESTMENTS BASED ON TIPS.
10. NOT HAVING A WILL

32. 5. EVALUATE AND REVIEW YOUR ACTIONS
FINANCIAL PLANNING IS A DYNAMIC PROCESS. IT DOES NOT END WHEN YOU TAKE A PARTICULAR ACTION. YOU NEED TO REGULARLY REASSESS.

33. PERSONAL FINANCIAL PLANNING
COMPONENTS OF
PERSONAL FINANCIAL PLANNING

34. 1. OBTAINING
RESOURCES WILL COME FROM YOUR EMPLOYMENT OR PROFITS FROM A PERSONALLY OWNED BUSINESS.
THESE RESOURCES WILL BE THE BASIS FOR ALL YOUR FINANCIAL ACTIONS.

35. B A N K SAVE AND INVEST PART OF THE INCOME YOU EARN.
YOUR SAVINGS AND INVESTMENTS WILL PROVIDE AN ADDITIONAL INCOME SOURCE.
B A N K

36. 2. PLANNING
BUDGETING THE SPENDING, SAVING AND INVESTING OF YOUR INCOME IS THE BASIS OF SUCCESSFUL FINANCIAL PLANNING.

37. 3. SAVING
LONG – TERM FINANCIAL SECURITY STARTS WITH A REGULAR SAVINGS PLAN FOR EMERGENCIES, UNEXPECTED BILLS, REPLACEMENT OF NEEDED HOME ITEMS.
ONCE THE BASIC SAVINGS COMPONENTS HAS BEEN ESTABLISHED, ADDITIONAL MONEY SAVED MAY BE USED FOR INVESTMENTS THAT OFFER GREATER RETURN.
B A N K

38. 4. BORROWING
MAINTAINING CONTROL OVER CREDIT BUYING HABITS WILL HELP YOU ACHIEVE FINANCIAL GOALS.
THE OVERUSE AND MISUSE OF CREDIT ARE MAJOR CAUSES OF PERSONAL ECONOMIC DIFFICULTIES.

39. 5. SPENDING LIVING EXPENSES AND OTHER FINANCIAL
OBLIGATIONS SHOULD BE DETAILED IN
A SPENDING PLAN.
RESTRICT YOUR SPENDING

40. 6. PROTECTING
HAVE AN ADEQUATE INSURANCE COVERAGE FOR YOURSELF, YOUR FAMILY AND YOUR PROPERTY.

41. SELECT INVESTMENTS WITH MINIMAL RISKS.
7. INVESTING
SELECT INVESTMENTS WITH MINIMAL RISKS.

42. 8. SHARING TIMING DECISIONS TO TRANSFER MONEY
OR PROPERTY TO OTHERS IS CRUCIAL TO THE FINANCIAL PLAN.

43. S U M M A R Y ADVANTAGES OF PERSONAL AND FAMILY FINANCIAL PLAN
ADULT LIFE CYCLE FINANCIAL PLAN
STEPS IN FINANCIAL PLANNING PROCESS
COMPONENTS OF FINANCIAL PLANNING

44. END OF LECTURE