l12 personal financial plan
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Lecture 12
Personal Financial Plan
McGraw-Hill/Irwin Copyright © 2012 by The McGraw-Hill Companies, Inc. All rights reserved.
2-1
Learning Objectives
• Understand the objectives of PFP & WM
• Identify the different planning areas of PFP
• Understand the 6-step financial planning process.
Copyright © 2009 by McGraw-Hill
Education (Asia)
2
Objectives of PFP
Objectives:
PERSONAL FINANCIAL PLANNING (PFP)
TO PROVIDE PROFESSIONAL & VALUE ADDED SERVICES TO FULFILL NEEDS OF CLIENTS
ITS 3 MAJOR FUNCTIONS:
• improvement of living standards
• risk management
• transfer of assets to next generation.
3
Objectives of WM
Objectives: WEALTH MANAGEMENT
IT IS CLOSELY RELATED TO THE CONCEPT OF PFP
GREATER FOCUS ON INVESTMENT MANAGEMENT
ITS MAIN FUNCTIONS: • Wealth Creation
• Wealth Accumulation
• Wealth Preservation
• Wealth Distribution.
4 Copyright © 2009 by McGraw-Hill
Education (Asia)
Personal Financial Planning (PFP)
5
• PFP is a comprehensive process – It evaluates all aspects of a client’s
financial needs
– Such needs are:
• Consumption
• income & wealth
• insurance,
• investment
• retirement
• tax & estate planning
5 Copyright © 2009 by McGraw-Hill
Education (Asia)
6
Goal-oriented
Planning Pyramid
Cash flow management/tax planning
Risk management/insurance
planning
Short//medium-term
investment planning
Retirement
planning
退休与遗产
人寿及财产 Life & asset
protection
Retirement funds
Education & home
purchase
Consumption, tax,
& short-term
liability
Estate
planning Trust & will
Personal Financial Planning
Copyright © 2009 by McGraw-Hill Education (Asia)
Areas of
Personal Financial Planning
1. Consumption Planning
(Cash flow management)
– cash flow management &
consumption behavior
2. Taxation Planning
– tax liability & obligations
Copyright © 2009 by McGraw-Hill
Education (Asia)
7
3. Insurance Planning
(risk management)
– insurance needs
– Life + other insurance
4. Investment Planning
– short, medium, long-term
investment goals
Copyright © 2009 by McGraw-Hill
Education (Asia)
8
Areas of
Personal Financial Planning
5. Retirement Planning
– retirement needs
6. Estate Planning
– inheritance, estate management &
philanthropic needs
(慈善的)
Copyright © 2009 by McGraw-Hill
Education (Asia)
9
Areas of
Personal Financial Planning
Chapter 02
Financial Aspects of Career
Planning
McGraw-Hill/Irwin Copyright © 2012 by The McGraw-Hill Companies, Inc. All rights reserved.
2-11
Chapter 2 Learning Objectives
1. Describe activities associated with career planning and advancement
2. Evaluate factors that influence employment opportunities
3. Implement employment search strategies
4. Assess financial and legal concerns related to obtaining employment
5. Analyze techniques available for career growth and advancement
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Career Choice Factors
Objective 1: Describe the activities associated
with career planning and advancement
• Career selection requires planning
• The average person changes jobs more than seven
times over a lifetime
• Job is an employment position obtained mainly to
earn money
• Career is a commitment to a profession that
requires continued training
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Career Choice Factors (continued)
TRADE-OFFS OF CAREER DECISIONS
• Career choices alternatives have risks and
opportunity costs
• Career choices require periodic evaluation of trade-
offs related to personal, social, and economic factors
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Career Choice Factors (continued)
CAREER TRAINING AND SKILL DEVELOPMENT
• Level of formal training affects financial success
• Training may be viewed in two main categories:
1. Technical Skills refers to specialized career training for a specific profession.
2. General Skills are traits adaptable to most work situations. Some can be acquired at school, while others require experience.
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Career Choice Factors (continued)
PERSONAL FACTORS
• Aptitudes
• Interests inventories
• Your personality
• Do you perform best in low-pressure or high-pressure working environments?
• Personal SWOT analysis
2-16
Career Opportunities: Now and in the Future
Objective 2: Evaluate factors that
influence employment opportunities
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Career Opportunities: Now and in the Future (continued)
SOCIAL INFLUENCES
• Demographic trends
• Geographic trends
– Where jobs are; salaries, and living costs
Working Parents More food service and child care
Leisure time More interest in health and
recreation
Longer life spans Demand for travel, health care,
and retirement facilities
Employment training Demand for teachers, trainers,
and related careers
2-20
Career Opportunities: Now and in the Future (continued)
Economic Conditions
• Career Opportunities are affected by:
– High interest rates
– Price increases
– Decreased demand for goods and services
2-21
Service Industries Expected to Have the Greatest Employment Potential
• Information technology
• Health care
• Business services
• Social services
• Sales and Retailing
• Hospitality and food services
• Management and human resources
• Education
• Financial services
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Employment Search Strategies
Objective 3: Implement employment search strategies
OBTAINING EMPLOYMENT EXPERIENCE
Part-time employment develop contacts
Volunteer work develop organizational skills
Internships experience helps obtain
employment
Campus projects obtain career skills
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Employment Search Strategies (con’t)
IDENTIFYING JOB OPPORTUNITIES
• Job advertisements
• Career fairs
• Employment agencies
• Job creation
• Visit organizations
• Telephone and business directories
• Web search
• Talk with alumni in your field
2-25
Employment Search Strategies (con’t)
APPLYING FOR EMPLOYMENT
• Resume
• Cover letter
• Interview
– See Chapter 2 Appendix for
detailed help in these areas
2-26
Financial and Legal Aspects of Employment
Objective 4: Assess the financial and legal concerns related to obtaining employment
***Research the job and the company before accepting an employment position
• THE WORK ENVIRONMENT
– Corporate culture
– Company policies and procedures
• FACTORS AFFECTING SALARY
– Education, training, company size, and salaries for comparable positions
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Financial and Legal Aspects of Employment (continued)
• EVALUATING EMPLOYEE BENEFITS
– Nonsalary benefits include: child care, leaves of
absence, and elder care
– Cafeteria-style benefits allow workers benefit
credits that they can choose to meet their needs
– Flexible spending and medical savings accounts
– Compare job offer benefits based on market value
or future value
– Know your employment rights
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Financial and Legal Aspects of Employment
(continued)
Objective 5: Analyze the techniques for career growth and advancement
• A career can be for a lifetime
• Skills and attitudes that can lead to a fulfilling work life:
– Communicate well with others
– Flexible and open to new ideas
– Develop efficient work habits
– Use lists, goal setting, and time management techniques
– Anticipate problems and areas for actions
– Creativity and a willingness to assist others
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Long-Term Career Development
(cont’d)
TRAINING OPPORTUNITIES
• Continue to learn about new technology and the global economy
• Formal methods for expanding knowledge: – company programs, seminars, and college courses
• Informal methods: – reading and discussions with colleagues
– meetings with employees from other companies
2-31
Long-Term Career Development
(cont’d)
CAREER PATHS AND ADVANCEMENT
• Career choices must be evaluated in light of changing values, goals, and economic conditions
• A mentor is an experienced employee who serves as a teacher and counselor for a less experienced person
– Mentors are attracted to those who show initiative
– Mentors should be receptive to assisting others, and help in both technical and social areas of their careers
2-32
Developing a Resume
• Personal data section
• Career objective section
• Education section
• Experience section
• Related information section
• References section
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Three Types of Resumes
• Chronological
- Most common; focuses on experience and
education in reverse-time sequence
• Functional
- Focuses on your skills
• Targeted
- Prepared for a specific job
• E-resumes for applying for a job online
- Use a simple format and no attachments
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Resume Preparation
• Presented in a professional manner
• Limit your resume to one page
• Use the STAR principle to highlight experiences and achievements:
• Situation, or the setting
• Task, your duties
• Actions you took
• Result, the outcome
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Creating a Cover Letter
• Introductory paragraph
– Get reader’s attention
– Overview your qualifications
• Development paragraph
– Specific qualifications
– Refer to details on resume
– Experiences and training
• Concluding paragraph
– Ask for interview
– Include how to contact you
– Summarize how you can help the company
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The Job Interview
• Prepare for the interview by getting information
about your prospective employer
Library resources such as annual reports or recent
articles
Internet searches of company and industry
information
Observations during company visits
• Prepare questions to ask about your interests, the
organization, policies, and benefits
• Practice interview skills
2-41
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