Personal Financial Planning Quiz 2

What is the main purpose of personal financial planning?

• To increase government revenue

• To manage money to achieve personal goals

• To avoid paying taxes

• To eliminate all financial risks

Which of the following is the first step in the financial planning process?

• Implementing the plan

• Identifying financial goals

• Monitoring the plan

• Buying insurance

Opportunity cost in personal finance means:

• The amount of money saved each month

• The value of the next best alternative given up

• The total return from investment

• The cost of borrowing

A young adult saving to buy a laptop is practising:

• Short-term financial planning

• Long-term financial planning

• Retirement planning

• Estate planning

Which of these is an example of an asset?

• Student loan

• Credit card debt

• Fixed deposit savings

• Unpaid bills

Which financial tool helps track income and expenses?

• Budget

• Insurance policy

• Stock portfolio

• Loan statement

What is the recommended minimum emergency fund?

• 1–2 months of living expenses

• 3–6 months of living expenses

• 12 months of income

• No savings needed

If Faiz spends all his salary without saving, he is lacking:

• Budget control

• Insurance coverage

• Tax planning

• Opportunity cost

Which is an example of a liability?

• Car loan

• Bank savings

• House owned fully

• Unit trust investment

Insurance in financial planning is mainly used for:

• Increasing profit

• Reducing financial risks

• Avoiding taxes

• Boosting savings