Introduction:
About personal financial plan:
Financial planning is important in every aspect of business and also in human life. Finance is the key resource to make live a meet all the expenses for livelihood. Personal financial management is a part of financial management which serves the purpose of managing personal financial and non financial assets. It also helps in efficient assets allocation in different investment opportunities to meet the future finance needs and expectations. In this document some of such analysis has been performed and presented to make a financial plan for the given case. The analysis is based on certain assumption and widely accepted practices, which makes better off to the concerned family and makes an efficient and optimal financial plan to achieve all the future financial needs and objectives.
Summary:
This report has been prepared using various financial models and financial analysis tools and techniques. The financial planning is based on various suitable assumptions and practices. For better convenience of the case and the financial planning and its analysis, a brief summary has been presented in the following heads.
Current situation:
Value of assets held by the family approximately $1,000,000
Liabilities and obligations $300,000
Net worth $700,000
Out of total assets of $1,000,000, 600,000 is in working assets and an additional $30,000 is added in each year.
Goals:
Robert is planning to retire at the age of 60 and Jane wants to retire at the age of 55.
Desired after tax monthly income at the time of retirement is $10,000
Life expectancy is of 80 years for each and the income is expected to be generated till that time.
Analysis details:
Analysis of assets allocation
Insurance requirement analysis
Retirement analysis
Analysis of healthcare power of attorney and wills
Retirement analysis:
The retirement analysis has been made based the current assets available, assets allocation over the planed period and expected financial needs and requirements after the retirement. All such analysis has been made based on certain assumptions, which have been clearly mentioned and listed as below.
Assumptions:
Particulars of client:
Annual Income:
Assumptions of rate:
Assets allocation:
After tax expenses:
Estimated education costs:
Other after tax expenses:
Retirement analysis:
Current retirement goals:
Annual retirement spending:
It can be observed from the above assumptions that, Robert will have an after tax expense of $90,000 after retirement and Jane will have a spending of $80,000. Hence, a monthly income from investments and social security must be meeting all those spending and expenses.
Assumptions:
Available resources and resource allocation for retirement:
References and bibliography:
Cheema, Marvi K., Glenda M. MacQueen, and Stefanie Hassel. “Assessing personal financial management in patients with bipolar disorder and its relation to impulsivity and response inhibition.” Cognitive neuropsychiatry 20.5 (2015): 424-437.
Herdjiono, Irine, and Lady Angela Damanik. “Pengaruh financial attitude, financial knowledge, parental income terhadap financial management behavior.” Jurnal Manajemen Teori dan Terapan| Journal of Theory and Applied Management 9.3 (2016).
Mien, Nguyen Thi Ngoc, and Tran Phuong Thao. “Factors affecting personal financial management behaviors: evidence from vietnam.” Proceedings of the Second Asia-Pacific Conference on Global Business, Economics, Finance and Social Sciences (AP15Vietnam Conference), 10-12/07/2015. 2015.
Qamar, Muhammad Ali Jibran, Muhammad Asif Nadeem Khemta, and Hassan Jamil. “How knowledge and financial self-efficacy moderate the relationship between money attitudes and personal financial management behavior.” European Online Journal of Natural and Social Sciences 5.2 (2016): 296.
