Homework: There will be three assignments making up 20% of your total grade. These assignments will be covered in more detail as the topics are

Transcription

1 Course Title: Personal Financial Planning Human Development and Family Studies 483 Instructor: Jeanna Nation 1337 Palmer (office) Contact: Tuesday/Thursday 9:30-10:45 67 LeBaron through Blackboard Learn Office Hours: Monday/Wednesday 1-2PM Course Description: Managerial approaches to achievement of short- or long-term financial goals for households. Investigation of different forms of investments and investment risks management in financing current and future consumption. Analyses of tax, estate, and retirement planning needs of the family. Course Objectives: The student should: Demonstrate an understanding of the importance of the time value of money in financial planning. Examine the economic, social, political, and technological environment and be able to determine how financial plans should accommodate those environments. Identify the potential goals a client may have, help them enunciate their goals and evaluate strategies to help clients achieve their goals. Construct personal financial statements and use ratios and other techniques to analyze these statements. Evaluate the use of credit and planned borrowing to meet household consumption, asset acquisition and other financing needs. Identify strengths and weaknesses in a client s initial situation and determine opportunities for problem solving. Intellectual Development: In addition to developing technical expertise in the course subject matter, this course develops and fosters: Communication skills, both written and oral Critical thinking Decision-making Team work Self-reflection Intellectual curiosity and lifelong learning Required Materials: PRACTICING FINANCIAL PLANNING For Professionals by Sid Mittra Financial calculator-texas Instrument BAII preferred Your computer must support Blackboard Learn capabilities. For more information please visit Comprehensive Financial Plan: You will develop a personal financial plan worth 20% of your total grade. This plan could include but is not limited to a budget, investments, retirement plan, insurance, etc. This project will be covered in more detail as it is presented throughout the class.

2 Homework: There will be three assignments making up 20% of your total grade. These assignments will be covered in more detail as the topics are presented throughout the semester. All homework is due at the beginning of class on the due date assigned above. Homework 1 Due: February 16 th Homework 2 Due: March 29 th Homework 3 Due: April 26 th Exams: There will be three exams making up 50% of your total grade. These examinations may include multiple choice, true/false, short answer, and short case analysis. You will receive more details about focus areas in the form of study guides and/or classroom review. There will be no make-up exams. Class Discussion & Participation: You will be expected to actively and respectively participate in classroom discussions throughout the semester. Your class participation is worth 10% of your total grade. Extra Credit: Extra credit will be given for current events. Current events may consist of recent journal articles, newspaper articles, electronic news clips, etc. that pertain to the content of this course. Each current event will count as ½ point of extra credit. A maximum of 20 points extra credit can be accumulated and only 1 point (two items) can be submitted per class period. Course Policies: All coursework must be typed. Students must notify the instructor in advance for late work. The only exceptions for late work will be for medical and other types of emergencies. Any late work submitted without prior approval will receive 0 credit. Grading Assessment of Student Mastery of Course Content: Grades are not curved. Final grades will be assigned on the basis of weighted points earned as a percentage of total weighted points available: A 94%+ A % B % B 82-85% B % C % C 72-75% C % D % D 62-65% D % F 59% and Below Intellectual Honesty: The value of an education at Iowa State University depends greatly upon the quality of academic work and research completed by students at our institution. Each member of the Iowa State community has an opportunity to play an important role in promoting and preserving integrity on campus. The academic work of all students must comply with all university policies on academic honesty. Examples of academic misconduct are: Attempting to use unauthorized information in the taking of an exam; Submitting as one's own work, themes, reports, drawings, laboratory notes, computer programs or other products prepared by another person; Knowingly assisting another student in obtaining or using unauthorized materials; or Plagiarism. A useful link to understanding plagiarism, the consequences of plagiarism, and best practices for avoiding plagiarism is available at: Academic honesty policies are included in the Policy On Academic Dishonesty, Policies and Procedures On Academic Misconduct Investigations, and Code of Computer Ethics and Acceptable Use Policy. These

3 policies are contained in the Student Disciplinary Regulations. In addition, students are responsible for following ethical standards adopted by the various colleges and departments. Other University Policies: Please address any special needs or special accommodations with me at the beginning of the semester or as soon as you become aware of your needs. Those seeking accommodations based on disabilities should obtain a Student Academic Accommodation Request (SAAR) form from the Student Disability Resource (SDR) office (phone ). SDR is located on the main floor of the Student Services Building, Room *Syllabus is always subject to change*

4 Course Outline the professor retains the right to modify this outline: Unit 1 January 9th Introduction to financial planning a. Financial planning process and introduction to CFP Board s 1 2 Financial Planning Practice Standards b. Economic, social, political, and technological environmental impacts to financial planning c. Evolution of financial planning d. Content of a comprehensive plan a. Certification, designations, licenses, and key participants b. Role of the planner Unit 2 January 16th Client attitudes, behavioral characteristics, household 2 characteristics and client communications a. Principles of communication b. Counseling techniques trust building c. Client idiosyncrasies (e.g., compulsive spending, gambling, addictions) d. Subjective risk preference and client psychology (includes culture) e. Household composition and its impact on financial status f. Role of economy when developing a financial plan g. Establishing client objectives and goals h. Mechanics of data gathering Unit 3 January 23rd Time value of money and applications 3 a. Review of basics (financial calculator, spreadsheets) b. Uneven cash flows c. Sensitivity of interest rates and time d. Growing annuities (geometric varying annuities) e. APR f. Real vs. nominal g. Structured and legal settlements h. Monetary windfalls i. Business valuation (DCF) Unit 4 January 30th Personal financial statements a. Statement of financial position 1. Treatment of retirement resources 2. Treatment of taxation and liquidation costs on net worth b. Cash flow statements c. Interpretation of statements (e.g. financial ratios) 7

5 Unit 5 February 6th Budgeting and emergency fund 7 a. Income projection and purchasing power b. Discretionary and non-discretionary c. Budgeting techniques d. Planning discretionary cash flow e. Emergency fund adequacy f. Liquidity vs. marketability g. Liquidity substitutes Unit 6 February 13th a. Submission 1-Comprehensive Financial Plan (Financial Statement Analysis) b. Assignment 1 Due c. Review d. Exam 1 Unit 7 February 20th Credit and debt management (depository/lending institutions) 7 a. Financing strategies b. Credit reports and FICO c. Types of credit d. Bankruptcy Consumer protection laws Financing asset acquisitions a. Buying vs. leasing 1. Computation of lease payment 2. Impact on financial statements b. Mathematics of installment loans c. Mortgage types and selection d. How much home is affordable? e. Mortgage math (e.g., amortization) e. Refinancing Unit 8 February 27th Educational funding a. Needs analysis b. Financing education 1. Financial aid process and determinants of financial aid 2. Sources of financial aid (e.g., loans, grants, scholarships) Plans, Coverdell ESAs 4. UTMA/UGMA 5. Treasury bonds 6. Retirement plans 7. Strategies c. Taxes and education (credits, deductions) d. Education planning policy statement 6

6 Unit 9 March 5th Risk management a. Introductory topics 1. Protecting standard of living (disability, life insurance, long-term care) 2. Protecting wealth and property (auto, homeowners, liability, umbrella, disaster) 3. Health Care coverage (HMOs, PPOs) b. Applications 1. Introduction to insurance needs analysis 2. Policy selection (group, government, and private) 4 5 Unit 10 March 19th Retirement a. Sources of income 1. Pensions 2. Social Security and other government plans 3. Personal savings 4. Reverse annuity mortgages b. Retirement needs analysis c. Tax-advantaged accounts d. Techniques for retirement projections Unit 11 March 26th a. Submission 2-Comprehensive Financial Plan (Financial Statement Analysis) b. Assignment 2 Due c. Review d. Exam 2 Unit 12 April 2nd Investments e. Introductory topics 1. Review of investment vehicles 2. Difference between insurance risk and investment risk 3. Risk and return 4. Types of investment risk 5. Measurement of risk 6. Efficient Market Theory f. Applications 1. Objective risk tolerance 2. Matching goals and risk tolerance to portfolio allocation 3. Passive vs. active management Unit 13 April 9th Tax overview and analysis a. Review the interrelationship between taxes and financial planning recommendations b. Determine possible tax planning opportunities and threats to a client within the context of the financial planning topic areas

7 Unit 14 April 16th Estate planning a. Documents 8 9 b. Types of ownership c. Trusts d. Gifting strategies e. Estate tax f. Probate Unit 15 April 23rd a. Cast Study Presentations b. Final Case Study Submission c. Assignment 3 Due Unit 16 April 30th a. Final Exam as shown on university schedule