BASICS OF FINANCIAL PLANNING

1. Identify the Plan

This type of financial plan ensures a comfortable life post-retirement.

• Emergency fund

• Retirement Planning

• Assessment plan

• Comfort Fund

2. Set a SMART Goal

A financial goal should be specific, measurable, achievable, realistic, and time-bound.
Question: What does the "T" in SMART stand for?

• Time Bound

• Title

• Technical

• Typical

Experts recommend setting aside 3-6 months' worth of expenses.
Question: What is this fund called?

• Retirement Fund

• Health Fund

• Emergency Fund

• Financial Fund

A popular budgeting rule is the "50/30/20" rule.
Question: What percentage is allocated for savings in this rule?

• 50

• 30

• 20

• 100

Money today is worth more than the same amount in the future.
Question: What is the term for calculating the future value of a present sum of money?

• Appreciated Value

• Future Value

• Present Value

• Annuity

This financial instrument represents ownership in a company and offers higher returns at higher risks.
Question: What is it called?

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• Commercial Paper

• Equity

• Bonds

• Treasury Bill

7. Risk Coverage

This type of financial product helps protect you against unforeseen health-related expenses.

• Options

• Life Insurance

• Health Insurance

• Swaps

If you are saving to buy a house in 5 years, this is an example of what type of goal?

• Long Term Goal

• Medium Term Goal

• Short Term Goal

• Five yearly goals

Albert Einstein called it the 8th wonder of the world.
Question: What is this magical financial concept?

• Compounding

• Retirement Planning

• Time bound

• Education Plan

10. Debt Management

This ratio compares your monthly debt payments to your monthly income.
Question: What is this ratio called?

• Profit to Expense

• Expense to Profit

• Loan to Liability

• Debt to Income