Why Personal Financial Planning Makes Sense

Mark Vanderberg Paul French

Introduction
Session One: Managing Your Money Session Session

Two: Protecting Yourself Three: Investments

Managing Your Money: A Holistic Perspective

Human Capital

Life Phases Life Styles Career Goals and Objectives Financial Literacy Current vs Future Consumption Wants vs Means

Financial Capital

Time Value of Money

Investor Behavior is the

DOMINANT
Factor affecting Real Lifetime Returns

Chasing performance is not a goal Trying to time the markets is not a goal Having your investments perform better than your neighbor is not a goal

Chasing performance is not a goal Trying to time the markets is not a goal Having your investments perform better than your neighbor is not a goal Creating wealth that you do not outlive in retirement, that will send your kids to college, and that will provide something for those you must one day leave behind. That is a goal.

Chasing performance is not a goal Trying to time the markets is not a goal Having your investments perform better than your neighbor is not a goal Creating wealth that you do not outlive in retirement, that will send your kids to college, and that will provide something for those you must one day leave behind. That is a goal. To do that, you need to plan

Road Map to Financial Health

Step One: Where are you now? Step Two: Where do you want to be? Step Three: Develop a Road Map Step Four: Begin the Journey Step Five: Check Your Progress

Life Phases

Early Years Golden Years Retirement Years

Early Years

Job and Career Family Taxes Unexpected Events

Principles Every Young Person Should Know

1.

Know your take-home pay. Pay yourself first. Start saving young.

2.

3.

Principles Every Young Person Should Know

4.

Compare interest rates. Dont borrow what you cant repay.

5.

6. Budget your money.

Principles Every Young Person Should Know

7. Money doubles by the Rule of 72. 8. High returns equal high risks. 9. Dont expect something for nothing.

Principles Every Young Person Should Know

10. Map your financial future. 11. Your credit past is your credit future. 12. Stay insured.

Reference

Books

Personal Finance: Turning Money Into Wealth- Arthur J. Keown Wall Street Journal Guide To Understanding Personal Finance The Only Other Investment Guide Youll Never Need- Andrew Tobias Smart Couples Finish Rich- David Bach Asset Allocation: Balancing Financial Risk- Roger C. Gibson
Money Magazine Kiplinger Personal Finance Smart Money
http://www.billshrink.com/blog/16-depression-era-money-saving-tips/#more-2240 www.360financialliteracy.org www.morningstar.com

Magazines

Websites

Questions? Rule of 72 = MC ?
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