Financial Plan

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Personal Financial Plan

Self-Reflection

Briefly answer each of the following questions about yourself.

  • What are my passions, those things that I have an intense desire or enthusiasm for?

 

 

  • What do I do best?

 

  • What activities do I need to be a regular part of my life?

 

  • What gives me energy?

I get atrill out of helping others and watching

  • What am I willing to sacrifice for?

 

  • Whom do I want to help in life? How can I help them?

 

  • What do I love to do?

 

 

 

 

Define Your Goals

State at least three short-term, three medium-term, and three long-term personal goals.

Short-term Goals (Examples: pay off credit card debt, go on vacation)

  • 1)
  • 2)
  • 3)

Medium-term Goals (Examples: get married, pay off student loans)

  • 1)
  • 2)
  • 3)

Long-term Goals (Examples: pay for children’s college, retire early)

  • 1)
  • 2)
  • 3)

 

 

 

Assess Your Current Financial Situation

Provide the details on your current financial situation.

Monthly Inflows (Examples: wages $1,000; parental allowance $500)

  • 1)
  • 2)

Monthly Outflows (Examples: rent $500, food $300, car payment $350)

  • 1)
  • 2)

 

Assets (Examples: car $10,000; savings $1,000; personal items $2,000)

  • 1)
  • 2)

Liabilities (Examples: car loan balance $12,500; student debt $35,000; credit card debt $800)

  • 1)
  • 2)

Describe your payment schedule and interest rate for each liability. (Examples: Equal monthly payments due after graduation for ten years at 6% interest, equal monthly payments of $350 for 20 months remaining)

  • 1)
  • 2)

 

 

Assess Your Future Financial Situation

Likely your future financial situation five years after graduation will be substantially different than your current financial situation. State your future career plans and estimate your annual earnings. Provide the source of your estimates. Need ideas? Check out the Bureau of Labor Statistics career exploration page: https://www.bls.gov/k12/students/careers/career-exploration.htm

Future Career Plan A:

Estimated Annual Income:

Source:

Future Career Plan B:

Estimated Annual Income:

Source:

 

Forecast your future monthly inflows and outflows five years after graduation based on your career plan A. State your sources. Use the FIN 2010 ‘Personal Financial Plan’ spreadsheet file to help you with estimating monthly expenditures on debt and taxes. Don’t forget to include taxes, insurance, transportation, food, and utilities in your monthly outflows.

Monthly Inflows (Examples: wages $3,500; investment income $200)

  • 1)
  • 2)

Monthly Outflows (Examples: house payment $1,000; student debt payment $400)

  • 1)
  • 2)

 

Sources:

 

 

 

 

Preparing for the Unexpected

For each of the following life circumstances, state how you will prepare in advance to address each situation financially.

  • An unexpected $300 expense

 

  • Your wallet or purse is stolen and you discover there are fraudulent charges on your credit card

 

  • A car accident results in $5,000 in damages and six weeks out of work

 

  • Strong storms cause approximately $20,000 damage to your home

 

  • A medically necessary surgery with three days of hospitalization

 

  • Unexpected early death

 

 

Investing for the Long Run

Many employers provide a retirement benefit, such as a 401(k) account, and may provide matching contributions into your account. State your planned choice in each situation.

  • Your employer provides a traditional 401(k) account; however, no matching funds are provided. What percentage of your salary per month do you plan to contribute?

 

  • Your employer provides a traditional 401(k) account and will match your contribution up to 5% of your salary if you put in at least 5% of your salary each month. What percentage of your salary per month do you plan to contribute?

 

  • Your employer provides a menu of low-fee investment options for your 401(k) account that include the employer stock, a money market fund, a mutual fund specializing in government bonds, and a mutual fund that invests in both domestic and international stocks. What percentage of your monthly contribution will you allocate to each option?

 

  • employer stock:
  • money market fund:
  • bond fund:
  • equity fund:

 

  • Your employer begins providing a Roth 401(k) account as an alternative to the traditional 401(k) account. Will you switch your monthly contribution to a Roth account? Why or why not?

 

  • Use the FIN 2010 ‘Personal Financial Plan’ spreadsheet file to help you with estimating how much your retirement account will reach by the start of your retirement.

 

estimated retirement account balance at retirement:

 

  • Use the FIN 2010 ‘Personal Financial Plan’ spreadsheet file to help you with estimating how much your retirement account will be able to produce in income each year of your retirement.

 

estimated retirement accountyearly withdrawal: