Section 2 - Financial Plan

Personal Financial Plan

• involves specifying financial goals and describing in detail the spending, financing, and investing plans needed to reach those goals.

• The process of forecasting future expenses and income

• Anything owned, such as cars, motorcycles, and homes.

• What we owe, or our debt

Budgeting

• involves specifying financial goals and describing in detail the spending, financing, and investing plans needed to reach those goals.

• The process of forecasting future expenses and income

• Anything owned, such as cars, motorcycles, and homes.

• What we owe, or our debt

assets

• involves specifying financial goals and describing in detail the spending, financing, and investing plans needed to reach those goals.

• The process of forecasting future expenses and income

• Anything owned, such as cars, motorcycles, and homes.

• What we owe, or our debt

Assets

• involves specifying financial goals and describing in detail the spending, financing, and investing plans needed to reach those goals.

• The process of forecasting future expenses and income

• Anything owned, such as cars, motorcycles, and homes.

• What we owe, or our debt

Liabilities

• involves specifying financial goals and describing in detail the spending, financing, and investing plans needed to reach those goals.

• The process of forecasting future expenses and income

• Anything owned, such as cars, motorcycles, and homes.

• What we owe, or our debt

Net Worth

• The amount of a specific asset that we own after subtracting any liabilities.

• The process of forecasting future expenses and income

• Anything owned, such as cars, motorcycles, and homes.

• The difference between assets and liability

Equity

• The amount of a specific asset that we own after subtracting any liabilities.

• The process of forecasting future expenses and income

• Anything owned, such as cars, motorcycles, and homes.

• The difference between assets and liability

Income

• The amount of a specific asset that we own after subtracting any liabilities.

• The process of forecasting future expenses and income

• Money coming in through wages earned, allowance, or other sources.

• The difference between assets and liability

Liquidity

• The amount of a specific asset that we own after subtracting any liabilities.

• How much readily available cash you have on hand for meeting immediate wants and needs.

• Money coming in through wages earned, allowance, or other sources.

• The difference between assets and liability

Interest

• The amount of a specific asset that we own after subtracting any liabilities.

• “Rent” on money you borrow.

• Money coming in through wages earned, allowance, or other sources.

• The difference between assets and liability