Financial Services _Çô Client Services RFC121 Lecture Notes - Lecture 2: Independent Contractor, Current Liability, List Of Fables Characters
5 Jun 2018
School
Department
Professor
Chapter 2
Money Management Strategy: Financial Statements and
Budgeting
Learning Objectives – Chapter 2
Recognize relationships among financial documents and money
management activities.
Create a system for maintaining personal financial records.
Develop a personal balance sheet and cash flow statement.
Create and implement a budget.
Calculate savings needed to achieve financial goals.
Learning Objective # 1
Recognize relationships among financial documents and money management
activities.
Planning for Successful Money Management
Money Management: Day-to-day financial activities necessary to manage
current personal economic resources while working toward long-term financial
security.
▪ Daily spending and saving decisions are at the centre of financial
planning
▪ Coordinate these decisions with your needs, goals and personal
situation
▪ Maintaining financial records and planning your spending are
essential to success
Opportunity Costs & Money Management
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▪ Spending money reduces the amount you can save and invest.
▪ Saving and investing reduces the amount you can spend now.
▪ Buying on credit ties up future income.
▪ Using savings for purchases results in lost interest earnings - savings can’t
be used for other purposes.
▪ Comparison shopping can save you money but uses up valuable time
Major Money Management Activities
Learning Objective # 2
Create a system for maintaining personal financial records.
Why Keep Financial Records?
An organized system of financial records provides a basis for:
▪ Handling daily business affairs, including paying of bills on time
▪ Planning and measuring financial progress
▪ Completing required tax reports
▪ Making effective investing decisions
▪ Determining available resources for current and future buying
▪ Many records are kept permanently (birth certificates, wills)
▪ Property / Investment records are kept for as long as you own the asset
▪ Keep tax records for a minimum of 6 years
What to Keep in Your Home File
▪ Items you refer to often such as;
▪ Personal and employment records.
▪ Tax records.
▪ Financial services records.
▪ Money management records.
▪ Credit records.
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▪ Consumer purchase and automobile records.
▪ Insurance records.
▪ Investment records.
▪ Housing records.
▪ Estate planning and retirement records.
What to Keep in a Safe Deposit Box
▪ Safe deposit box is a private storage area at a financial institution with
maximum security for valuables
▪ Use it to keep records and items that would be hard to replace.
▪ Birth, marriage and death certificates.
▪ Citizenship and military papers.
▪ Adoption and custody papers.
▪ Serial numbers and photos of valuables.
▪ GIC’s and bank account numbers.
▪ Mortgage papers and titles.
▪ List of insurance policy numbers.
▪ Stock and bond certificates.
▪ Coins and collectibles.
▪ Copy of will.
Other Places to Keep Records
▪ Automobile.
▪ Vehicle registration.
▪ Lawyer.
▪ Original of your will and living will.
▪ Doctor and hospital.
▪ Copy of your living will.
▪ Home computer.
▪ Current and past budgets.
▪ Chequing account records.
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find more resources at oneclass.com
Document Summary
Create a system for maintaining personal financial records. Develop a personal balance sheet and cash flow statement. Calculate savings needed to achieve financial goals. Recognize relationships among financial documents and money management activities. Items you refer to often such as: personal and employment records, tax records, financial services records, money management records, credit records, consumer purchase and automobile records, insurance records, investment records, housing records, estate planning and retirement records. Other places to keep records: automobile, vehicle registration. Lawyer: original of your will and living will, doctor and hospital, copy of your living will, home computer, current and past budgets, chequing account records, wills, estate plans, investments, past income tax returns. Summarize the value of the items you own and the amounts that you owe. Track your cash inflows by source and your outflows by type. Identify strengths and weaknesses in your current financial situation. Provide data for use in filing your income tax return or applying for credit.
