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Published byEvelyn Bradley Modified over 9 years ago
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Unit 1: The Financial Planning Process
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I can… Learning Objectives I can explain why personal financial planning is so important. I can describe the five basic steps of personal financial planning. I can set short, intermediate, and long term goals. I can explain how career management and education can determine income level. I can calculate monthly income using hourly, overtime, and commission based rates. I can create a resume. I can create a cover letter. I can explain appropriate interview attire for a male and female. I can list what to do before, during, and after an interview.
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Financial planning allows you to accomplish the following: Manage the unplanned – Plan to deal with the unexpected – Allows you to bounce back from a hard knock instead of going down for the count Accumulate wealth for special expenses – Maps out strategies for travel, a big wedding, college for you or your children, or buying a home Save for retirement – You do not want to be penniless at 65 – Planning will help you live a life of retirement ease.
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Financial planning allows you to accomplish the following (cont.): “Cover your assets” – Protect what you’ve got Invest intelligently – Providing basic principles of investment for smart investing Minimize your payments to Uncle Sam: – Helps you legally reduce the amount of tax you have to pay
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The five basic steps to personal financial planning… Step 1: Evaluate Your Financial Health Step 2: Define Your Financial Goals Step 3: Develop A Plan of Action – Flexibility – Liquidity – Protection – Minimization of Taxes Step 4: Implement Your Plan Step 5: Review Your Progress, Reevaluate, and Revise Your Plan
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Establishing Goals Short-term- can be accomplished in a one year period – Example: new shoes, television, taking a vacation Intermediate term- may take from 1 year to 10 years to accomplish – Saving for college, a new car, a home, a wedding Long term- takes more than 10 years to accumulate money – A second home, retirement
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Financial Life Cycle Stage 1: Early Years- time for wealth accumulation (through age 54) Stage 2: Approaching Retirement- the Golden Years (ages 55-64) Stage 3: The Retirement Years (age 65 and older)
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Estate planning- planning for your eventual death and the passage of your wealth to your heirs Inflation- an economic condition in which rising prices reduce the purchasing power of money
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What are your financial goals?
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Bellringer Write the question and answer on a scratch piece of paper. We will turn these in later. How do YOU feel career choices impact your financial health? Explain using 2 or more sentences.
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Research Shows…
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