Essay About Financial Goals And Time Frame

Influences on Financial Goals and Decisions
University of Phoenix            Damian RodriguezConcept: Influences on financial goals and decisions 1. The stages that an individual goes through based on stages in the family and financial needs is called theFinancial planning processBudgeting procedureAdult life cycle Personal economic cycle2. The Rule of 72 is A tool to determine the number of years until retirement for an employeeUsed to estimate how long it takes for prices to double using a given annual inflation rate The legal code for requiring companies to provide a match on retirement savingsUsed to calculate interest rates for savings3. Which is NOT an influence in financial goals?Global influencesEconomic conditionsInterest ratesFinancial intimacy with a partner 4. Which is NOT an identifiable financial goal?Retirement and estate planningRisk managementLiving on a fixed income Saving5. Attempts to increase income are part of the __________ component of financial planning.Obtaining PlanningSavingSpending1.2 Concept: Develop personal financial goals6. SMART Goals contain all of the following except: Specific – knowing exactly what the goals are and how to attain themAction Oriented – the bases for the goalsManageable – to be able to understand the written goals Time based – the time frame needed to reach the goal7. Short-term goals are: Goals to be attained within a year or so  Contain college plans for children Creating an estate plan Making a big purchase8. Long-term goals are:Goals to be attained within two yearsUses short-term goals to attain certain goals in five or more years Create a Christmas fundPlan for summer vacation        9. Which of the following intermediate goals is stated most clearly?Buy a car for less than $17,000 within six months.Retire in ten years at age 65 with $2,000,00 in my 401(k) account.Purchase a home with a mortgage no greater than $150,000 within three years. Set up an emergency fund.10. Fran has a goal of “saving $25 per month for a TV.” Fran’s goal lacksMeasurable termsA realistic perspectiveA specific objectiveA time frame 1.3 Concept: Calculate time value of money for financial decisions11. Opportunity cost can be defined asA trade-off of a decision Failing at goalsCreating financial wisdomThe amount paid for taxes when a purchase is made12. Which of the following is an example of opportunity cost?Renting an apartment near a schoolSaving money instead of taking a vacation Purchasing automobile insuranceUsing a personal computer for financial planning13. To calculate the time value of money, we need to consider all of the following except the Amount of the savingsAnnual interest rateLength of time the money is investedType of investment 14. What is the correct formula for future valueTime period X present interest rateInvestment in savings X interest rate X period of time Time X interestNone of these15. Which statement best explains the purpose of present value