Unit 1

    A plan that contains personal financial goals you want to accomplish.

A formal process of looking at your current situation and thinking about your future.

Will require long-term commitment.

As with any plan, you will put it into action and monitor it periodically.

  Some people will want to create their own plan and others may use a financial planner.

Financial Planner – Professional trained to provide advice about how to invest earnings, plan for retirement, and manage other financial matters.

Goal – the end result of something a person intends to acquire, achieve, do, reach, or accomplish sometime in the near or distant future Financial goals – specific objectives to be accomplished through financial planning Education goals - enable individuals to prepare for future success in the workplace

  Short-term goals – specified as less than one year  I plan to raise my English grade from a C+ to a B by the end of this school year by going to the writing lab and having my research paper reviewed prior to turning it in. Long-term goals – specified as more than one year  By the end of the next summer year I would like to purchase my first car by saving $50 per month from my part time job.

SMART Goals Specific Measurable Attainable Realistic Time Bound State exactly what is to be done Include how the goal can be measured Determine steps to reach the goal Do not set goals for something unrealistic State when the goal will be met

 Help individuals prepare for success in the workplace  Examples include: ▪ Earning an A on an upcoming quiz ▪ Attending college ▪ Participating in extra-curricular activities  Include both short-term and long-term goals  Provide guidance and direction  Enable individuals to reach financial goals

SMART Goals Specific Measurable State exactly what is to be done with the education aspect involved Write the grade or class that the goal is for Attainable Determine how it can be reached Realistic Time Bound Do not set goal for something unrealistic Specifically state when the goal needs to be reached

  Goal – “I want to attend college.” SMART goal –  Specific – I want to attend a four year college  Measurable – Because I want to attend a four year college, I will earn a B in algebra  Attainable – Because I want to attend a four year college, I will earn a B in algebra this semester  Realistic – Because I want to attend a four year college, I will earn a B in algebra this semester to prepare me for the college entrance exam  Time Bound – Because I want to attend a four year college, I will earn a B in algebra this semester to prepare me for the college entrance exam when I am a junior in high school

S

pecific

M

easurable

A

ttainable

R

ealistic

T

ime Bound • State exactly what is to be done with the money involved • Write the exact dollar amount the goal is for • Determine how it can be reached, which is often determined by the individual’s budget • Do not set goal for something unattainable or unrealistic • Specifically state when the goal needs to be reached

  Goal – I want to buy a new car SMART goal –  Specific – I plan to save for a down payment on a new car  Measurable – I plan to save $5,000 for a down payment on a new car  Attainable – I plan to save $5,000 for a down payment on a new car by saving $200 from every paycheck  Realistic – It is realistic to save $200 from each paycheck for a down payment on a car because I usually waste the money on unnecessary items instead of saving it  Time Bound – I plan to save $5,000 for a down payment on a new car by saving $200 from each paycheck for two years.

 Find the missing element (specific, measurable, attainable, realistic, or time bound) in the following financial goals  Financial Goal #1  As a senior in high school, I plan to save $5,000 for college living expenses in four years.

 Financial Goal #1 Answer:

Attainable

 Find the missing element (specific, measurable, attainable, realistic, or time bound) in the following financial goals  Financial Goal #2  I plan to save for a new computer by saving $150 each month for one year.

 Financial Goal #2 Answer:

Measurable

 Find the missing element (specific, measurable, attainable, realistic, or time bound) in the following financial goals  Financial Goal #3  I plan to save $2,500 by saving $105 each month for 2 years.

 Financial Goal # 3 Answer:

Specific

 Find the missing element (specific, measurable, attainable, realistic, or time bound) in the following financial goals  Financial Goal #4  I plan to save $1,500 to buy a used car by saving $75 from each paycheck

 Financial Goal # 4 Answer:

Time Bound

 Find the missing element (specific, measurable, attainable, realistic, or time bound) in the following financial goals  Financial Goal #5  I plan to save $2,000 to pay for a new computer by saving my whole paycheck for the next 6 months

 Financial Goal # 5 Answer:

Realistic

     Your financial plan represents your personal financial goals at one point in time.

Those goals are likely to change over time.

For example, you may inherit money, or you may have a job opportunity overseas, or you may wish to spend more time on a hobby or a side business. The financial plan is a work in progress; it is never finished.

As one goal is accomplished, another personal goal is defined.

     Beginning tomorrow you will write your own plan.

This project will give you the opportunity to think about your goals.

You will have 2 ½ days to complete this in the lab.

Next Monday and Tuesday we will present the plans to the class.

Thursday we will have our first quiz (25 questions).