Personal Financial Planning - Essay Example

Comments (1) Cite this document
Summary
Everyone has to plan for his better future life. 60 years old Jeff needs to invest his money in such a way that he may get a good return at the time of retirement. The data shows his average annual income of last five years i.e. about £28000…
Download full paperFile format: .doc, available for editing
GRAB THE BEST PAPER96.7% of users find it useful
Personal Financial Planning
Read TextPreview

Extract of sample "Personal Financial Planning"

Download file to see previous pages Jeff has now 5 years of job remaining. The best way to utilize his resources to save the money for his retirement is to invest the amount to get a good return. So that he may have enough money to complete his post-retirement plans. Jeff is also having full National Insurance contributions and has some savings. He has won the lottery ticket prize of £800,000. Now he has to use the entire amount wisely because he has various plans to be fulfilled. These plans can only be completed by having proper use of the available cash. For that purpose, Jeff needs complete personal financial planning.
Now Jeff needs to be very careful to use the money in such a way that he may fulfill his plans after retirement. Obviously he would like to use his money to earn some profit on it. The financial institutions are there to help such people. They offer different rates for the investment of 5-10 years and so on. They have different policies so one should be aware enough to choose his required package of investment according to the rates. He should deposit the amount for annuity and get the reward at the end of fiscal periods. In UK market, the present rate of pension annuity is about 40% and it also varies by institution to institution. So if Jeff starts investing his money for pension annuity then this activity will be fruitful at the time of his retirement. Moreover, statistics shows that there are chances of increase in the annuity rate in coming years.
Normally the pension annuity period goes to the age of 75 in UK but mostly people avail the opportunity at the time of retirement i.e. 65. Though some people go for other options to hold their finance or maximize it. That is the remedial measure to adopt such steps during the job to secure the life after retirement. During the job, this may be the best way to save money for future. But there is another fact that if anyone at the age of 65, wants to utilize his annuity amount then there will be surely reduction of 1% in profit. This is the reason people go for other options. More the time will be; more the chances to get higher profit for annuities (Murthi, July 2000). All the people whether they are skillful or not, consider the financial planning a very important thing. With the passage of time people became aware of its importance. It’s not necessary that they have the knowledge to plan perfectly for their selves or not. The thing is that they have vision of the importance of financial planning and they want develop a financial plan for themselves to save their financial resources for the future life. The advice of an expert financial advisor also helps the individual lot. A research study shows that only 13% people are known with the skills of financial planning. Everybody has his own preferred resources to identify the needs to plan for future life (Murphy, 2010). In Jeff’s case, we need to consider the rates of different institutions and compare their rates of annuities. The highest rate of return will be considered. Basically, the rates are linked with the period of time you are investing money for. If the time period is longer, the rate will be higher and vise versa. The investor gets the highest rate in the later years so that is the main purpose of pension annuity. This thing helps the individual to secure their future after retirement. So this will be beneficial for Jeff to invest money in pension annuity and make it more of the original. We can go for fixed annuity. In such annuity, the annuity is sure for some years e.g. we say that we have an annuity for 5 years. So it is the annuity in which number of years is fixed. The financial institution will make the payment at the end of that period. Jeff can get more of this plan. Another option is the Maximum Investment Plan offered by different ...Download file to see next pagesRead More
Cite this document
  • APA
  • MLA
  • CHICAGO
(“Personal Financial Planning Essay Example | Topics and Well Written Essays - 2500 words”, n.d.)
Retrieved de https://studentshare.org/finance-accounting/1390692-personal-financial-planning
(Personal Financial Planning Essay Example | Topics and Well Written Essays - 2500 Words)
https://studentshare.org/finance-accounting/1390692-personal-financial-planning.
“Personal Financial Planning Essay Example | Topics and Well Written Essays - 2500 Words”, n.d. https://studentshare.org/finance-accounting/1390692-personal-financial-planning.
  • Cited: 0 times
Comments (1)
Click to create a comment or rate a document
ma
marcdibbert added comment 6 months ago
Student rated this paper as
Brilliant paper! Used it to complete an assignment for a finance & accounting course. It was easy as ABC, for the first time in my life.

CHECK THESE SAMPLES OF Personal Financial Planning

Personal financial planning

...?Personal Financial Planning The purpose of this paper is to provide a critical discussion on various healthcare models. The format that this paper will utilize is to first identify the model, describe some of its key features and then discuss how it relates to the healthcare in the U.S. today. Bismarck: The Bismark healthcare system owes its history to the German Chancellor (Otto Von Bismarck). This healthcare system is somewhat based on the model of a government welfare state as implemented by the chancellor. Funding for the healthcare system comes from a kind of insurance that is largely funded by employers, employees, and the government which would be familiar to many Americans. However where this healthcare system differs... Financial...
1 Pages(250 words)Essay

Personal financial planning

...System that combines insurance with private health care providers. Most Americans pay for and received medical services in a manner that resembles the Bismarck System, although many insurance providers in other countries are not operated for profit and cannot discriminate against persons for pre-existing medical conditions. The Medicare System of healthcare, like the system in Canada, combines private healthcare providers with government payer insurance. While some American healthcare programs combine private providers with a single government payer, these programs are funded through taxes rather than insurance premiums. A few countries have adopted the Beveridge System of healthcare in which the government is both the...
1 Pages(250 words)Essay

Personal financial planning

...Assignment Part A Briefly explain what options are available to Jack with respect to the payment he will receive upon termination of his employment, including his superannuation balance. Calculate the resultant tax treatment of the payment with respect to those options. One of the best options jack could plan is to pay a small amount of future pre-tax salary to the investments. The plan for such investments would also help to pay for personal insurance to protect the family income. Investment in $ Tax rate Tax contribution Net amount (No other deduction assumed) Tax...
6 Pages(1500 words)Essay

Personal Financial Planning

...PERSONAL FINANCIAL PLANNING David and Ruth prefer low risk and an assured and stable income from their personal investment portfolio. Hence, this important investment preference must be considered in the process of determining the best possible investment and retirement portfolio for the couple. a) The total wealth portfolio of the couple is as follows: David has 80,000 held in a building society 30 day notice account. Given an 8% annual return, he gets to earn 6,400 annually from this investment. He has 760,000 invested in equity unit trusts which earns annually. Ruth receives index-linked occupational pension of 16,000 per year. She has 50,000 in ISAs which earns 7,000 yearly. They own a house with a net value of 350,000... receives...
12 Pages(3000 words)Assignment

Financial Services - Personal Financial Planning

...such safety net. The prevalence of these programs that are part of the policies of the government, seem to be enough for the public which does not give additional incentive to save. B. Personal financial plan and long-term financial security While people are discouraged by the government to save through its various policies that penalizes the savers, the future’s uncertainty is the major motivation behind all personal financial planning efforts (Xiao & Noring 1994). Planning enables people to certain strategies in order to meet their goals while adapting to uncertainties that the future...
7 Pages(1750 words)Essay

Personal Financial Planning of a Common Citizen

...Personal Financial Planning Table of Contents Introduction 2 The Scenario 3 Requirements 4 Investment Avenues 4 Financial Planning 7 Conclusions 11 References 12 Bibliography 13 Introduction People work hard all his life to live better. The definition of better living can vary from person to person. For some it might be the social status, for others it might be holidaying at world famous sites or partying with near and dear ones. There are innumerable such options. The one common thing among all the options is that to experience one or the other, the person needs money. This is the basic reason why...
10 Pages(2500 words)Essay

Finance - Personal Financial Planning - Book Report

...PERSONAL FINANCIAL PLANNING here] [Your [Due paper] Finance - Personal Financial Planning - Book Report The book thatI selected for review is ‘Personal Financial Planning’. The authors of the book are Lawrence J. Gitman, Michael D. Oehnk, and Randall S. Billingsley. The book consists of six parts and each of those parts has two to three chapters. The book relates with personal financial planning in a way that all material included in this book talks about different issues related to finance, such as, foundations of financial planning, management of basic assets, management of credit, and management of insurance needs. I have gained a huge amount of knowledge about financial planning through this book. Every part and every chapter... of the...
4 Pages(1000 words)Book Report/Review

Finance - Personal Financial Planning

...User Tomoki Ando Fall 4, - FINA-3307-01 - Personal Financial Planning - Online Extension Test Final Exam Started 10/19/12 4:59 PM Submitted 10/19/12 5:37 PM Status Needs Grading Score Grade not available.   Time Elapsed 38 minutes out of 3 hours. Instructions You will have approximately 3 hours to complete this exam.  If you have any technical trouble you can call the help desk at 1-866-264-1560 or you can contact me at 817-300-8498.  Any work for the short answer/calculations will have to be scanned and/or emailed to me for partial credit consideration. Question 1 3out of 3 points   Which type of health insurance pays part of all of the surgeons fee for an operation Answer...
2 Pages(500 words)Assignment

Personal Financial Planning

...Insert Personal Financial Planning Financial planning is a fundamental concept that is crucial is making important household as well as business decisions. It is important to understand the tools that govern financial expenditure so as to identify areas that need improvement. This is in effect to either raise finances for projects that require more finances. In strict terms, the above practice is called budgeting. It involves allocation of the otherwise meager resources to already identified needs. This helps in managing of available funds for appropriate use. This is done by doing a comparison of the income generated in a particular...
2 Pages(500 words)Case Study

Personal Financial Planning

... insurance and household and personal care should also be promptly paid in order to improve the quality of life by ensuring family safety. The second goal which is to get caught up on all past due bills will has similar advantages as the first goal. The third goal, establishing an emergency fund of $ 1000, will provide funds that facilitate response to unforeseen occurrence such as accidents thus will reduce financial stress in the future. The fourth goal, going back to school, will improve Susan’s skills and qualifications for a better paying job. She could be working as an elementary school teacher where she will be eligible for better salaries. The fifth goal, saving for Kids College, will reduce the future financial burden... Task:...
5 Pages(1250 words)Case Study
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.

Let us find you another Essay on topic Personal Financial Planning for FREE!

Contact Us