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7 Cards in this Set
- Front
- Back
- 3rd side (hint)
What is personal financial planning?
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Artistic & Scientific process of creating, implementing, tracking various multidirectional decisions in order to achieve the financial goals of an individual/family.
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Through what activities is the personal financial planner expected to guide the client?
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ID the financial mission
Setting financial goals Developing financial objectives Creating alternative strategies Select the best strategy Implementing, monitoring and controlling a financial plan. |
MGOASIMC
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What benefits can a client derive from the process of financial planning?
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ID & prioritize goals.
Objective & rational view of choice/resource allocation. Forward/proactive vs. backward reactive. Systematic analysis of internal/external environment Management of risk Framework for feedback, eval, control Positive view of change to accomplish goals, Discipline and formality to financial affairs. |
8
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What does the Financial Planners Pyramid of Knowledge identify?
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Identifies the skills/basic tools,
Knowledge of core topics Understanding of profession of financial planning. |
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Why do people hire Financial Planners?
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People lack:
time, knowledge or expertise to create their own financial plan. Efficiency and effectiveness. |
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How does Financial Planning promote efficient allocation of a client's resources?
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Provides a client with alternative options & opportunity cost of each alternative so rational, informed choice can be made.
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Why is financial success a relative concept?
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Means different things to different people because each person has own std of benchmarks/beliefs. If you had $1k in your pocket and your friend has $20k in their pocket, you may not feel as financially successful.
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