What Is The First Step In Financial Planning Quizlet?

The first step of financial planning is

to determine your current financial status

. A new car is an example of a need. Saving money for the holidays is an example of a long-term goal. The main cause of inflation is an increased demand without an increase in supply.

What is the first step of financial planning class 12?

Steps in Financial Planning

Determination of financial objectives

. Estimation of capital requirements. Determination of kinds of securities to be issued. Formulation of financial policies, procedures and budgets.

What is the first step in financial planning?

1. Step 1 – Defining and agreeing your financial objectives and goals. …
2. Step 2 – Gathering your financial and personal information. …
3. Step 3 – Analysing your financial and personal information. …
4. Step 4 – Development and presentation of the financial plan.

What is the final step of financial planning?

(1)

determining your current financial situation

. (2) developing financial goals. (3) identifying alternative courses of action. (4) evaluating alternatives.

What is the first step in a long-term financial plan?

Establishing your goals

is the very first step to effective financial planning. Identifying goals means defining the purpose of planning.

What are the 6 steps in the planning process?

1. Identify the direction, problem, or goal.
2. Research.
3. Analyze your options.
4. Propose a solution.
5. Implement.
6. Review and adjust.

What is the six step financial planning process?

(1)

determining your current financial situation

. (2) developing financial goals. (3) identifying alternative courses of action. (4) evaluating alternatives.

What are the features of good financial plan?

• A consistent flow of money into the plan. …
• A fair rate of return as it pertains to your individual plan objectives and risk tolerance.
• Minimum tax consequences while you are building your plan.
• Minimum tax consequences while you are reaping the fruits of your labor.

What are the seven steps of financial planning?

• The 7 Steps of Financial Planning.
• Step 1: Understanding the Circumstances.
• Step 2: Identifying and Selecting Goals.
• Step 3: Analyzing the Client’s Situation.
• Step 4: Develop the Plan.
• Step 5: Presenting the Recommendations.
• Step 6: Implementing the Recommendation(s)
• Step 6: Monitor the Plan.

What are the key features of a financial plan?

ADVERTISEMENTS: Some of the important characteristics of a sound financial planning are: (1)

Simplicity (2) Foresight (3) Flexibility (4) Optimum use of funds (5) Liquidity

(6) Anticipation of contingencies and (7) Economy. Sound financial planning is necessary for the success of any business enterprise.

What are the three rules of financial planning?

• Rule #1: Keep Debt Under Control.
• Rule #2: Avoid Being House-Poor.
• Rule #3: Aim to Save at Least 10% of Income.
• Rule #4: Don’t Overlook Emergency Savings.
• Rule #5: Be Realistic About Retirement.
• The Bottom Line.

What are the 7 steps to have a workable and meaningful financial plan?

• Goal Setting. Money is a difficult topic. …
• Cash Flow Analysis. In order to fund your goals, you’ll need to direct your money towards them. …
• Goal Analysis. …
• Investment Analysis. …
• Risk Analysis/Management. …
• Estate Review. …
• Rinse & Repeat.

What is the first step of the five step financial planning process?

Review Of Current Financial Situation

The first step in the financial planning process involves

taking a detailed look into a person’s current financial situation

. This means examining a person’s savings, income, debts and current living expenses.

What is effective financial plan?

A good financial plan is designed to put you at ease. It tells you how likely it is that you’

ll achieve your financial goals based on your current situation and planned future financial behavior

. Of course in order to do this the plan makes assumptions about the economy, stock market, interest rates and inflation.

What is the most important step in financial planning quizlet?

for retirement expenses. The five steps in the financial planning process​ are:

evaluate your financial​ health, define your financial​ goals

, develop a plan of​ action, implement your​ plan, and​ finally, review your​ progress, reevaluate, and revise your plan.

What does financing not involve?

financing does not involve

borrowing money

. Capital expenditures are: major investments in either tangible long-term assets such as land, buildings, and equipment, or intangible assets such as patents, trademarks, and copyrights. You just studied 97 terms!