Chapter 1-Financial Planning - Financial Planning The ties that Band Why Personal Financial Planning Money doesnt come with instructions Its easier to

Chapter 1-Financial Planning - Financial Planning The ties...

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Financial Planning: The ties that Band Why Personal Financial Planning? Money doesn’t come with instructions It’s easier to spend than to save People are “ignorant” about it If you don’t control your finances, they will control you To achieve your goals To reduce your stress 1 out of 4 credit card history has an error What you can Accomplish Manage the unplanned “Find money” in your budget make big-ticket purchases accumulate wealth or special expenses and goals invest for retirement “Cover your assets” invest intelligently maximize after-tax income The Financial Planning Process Financial planning is an ongoing process o As your life goals and situation Five Basic Steps to personal financial planning: 1. Evaluate your current financial condition 2. Define your financial goals 3. Develop a plan of action (3 diff plans) 4. Implement you plan 5. Review your progress, re-evaluate your situation/goals, and revise your plan (test question: gives situation and which step is it) Evaluate Your Current Financial Condition: What do you own? (assets) What do you owe? (liabilities, debts) What do you earn? (income) What do you spend? (expenses o What are you spending it on?
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