planning personal finances. personal financial planning spending saving investing so you can have...
TRANSCRIPT
Planning Personal Finances
Personal Financial Planning
SPENDING
SAVING
INVESTING
So you can have the kind of life you want
as well as financial security
Influences on PersonalFinancial Planning
Economics
The study of the decisions that go into making, distributing, and using goods and services.
Economic Factors
• Market Forces– Supply– Demand
• Financial Institutions– Federal Reserve
System
• Global Influence
• Economic Conditions– Consumer Prices
• Inflation
– Consumer Spending• Employment
– Interest Rates• Interest
Financial Strategies
Opportunity Costs
Personal
Financial
Calculating Interest
Principal
Future Value
Present Value
Strategy 1: Beverly
Age Annual Contribution
Year-end Value
18 1,000
19 1,000
20 1,000
21 1,000
22 1,000
23 1,000
24 1,000
Age Annual Contribution
Year-end Value
64 0
65 0Summary
Data
Principal Invested $7,000
Future Value $519,552.58
Investment Return
$512,552.58
Strategy 2: Matt
Age Annual Contribution
Year-end Value
25 0
26 0
27 0
28 1,000
29 1,000
30 1,000
31 1,000
Age Annual Contribution
Year-end Value
64 1,000
65 1,000Summary
Data
Principal Invested $38,000
Future Value $400,447.78
Investment Return
$362,447.78
Who is the wiser investor Beverly or Matt?
WHY?