this is a financial personal plan.It must be the personal opinion think and plan.i am student right now and my income is $1746.There many calculations in this paper and some future plan like have children and educate them as one of the future objectives.

Finance 370

Personal Financial Planning Case Study

Due December 2

I. Introduction: You are to assume that you are your own financial planner (i.e. you are the client as well as the planner). As such you will know the intricate details of your financial situation, your own financial goals, and your attitudes towards risk, leisure, retirement, etc. You will be asked to think about your future and plan accordingly. Your first priority is to evaluate your “dream” job. Investigate where you want to live, how much like positions in this location typically pay, and use this information to paint a picture of what your life will be when you leave WVU. Built into your “story” should be information about future (or current) plans regarding family, marriage, children, and career choices and goals.

II. Economic Information

Assumptions:

Over the past year you made 7% on all of your investments. If you do not have any investments, forecast how much of your future salary you will invest, what you expect your company to contribute, and use this amount as your base.

Your salary is expected to grow 3% each year.

Inflation is expected to be 2% annually.

Assume a starting annual salary of $50,000 after graduation.

External Environment Analysis: Perform an external environmental analysis to include in your comprehensive financial plan. Pay particular attention to recent political events, the financial crisis, and the current economic outlook. Your external environment analysis should include a comprehensive examination of the key U.S. economic indicators, as well as events in global markets. Your analysis should indicate how past, current, and future factors in the external environment of your client will have an impact on your client today and in the future.

Internal Environment Analysis: Perform an internal environmental analysis to include in your comprehensive financial plan. The internal analysis should address the following:

Life cycle positioning (Age, Marital Status, Dependents, Income level, Net worth)

Attitudes and beliefs towards government, taxation, leisure, and work Special needs (divorce, aging parents, disability, special needs dependents)

III. Personal Budgeting: Your objective for this portion of the case is to create a personal budget for yourself. Start by evaluating the past year’s expenditures and income to help develop a current budget. It is your responsibility to monitor your budget over the next two months to determine whether you are on target. Document any deviations from your budget and offer explanations as to why they occurred including whether they were one time impulse purchases, or whether they are expenditures which are either seasonal or recurring that may need to be implemented into the budget. Based upon the current budget that you compile, you must also create a budget for after you graduate from WVU program. This means that you will need to gather data and project what your expenditures will be assuming you will either be promoted or obtain a new position once you complete your studies. Particular attention should be paid to location, taxes, wages, transportation costs, entertainment costs, rent/housing costs, and variable expense items such as food, clothing, and utilities.

IV. Providing Financial Direction: Go through the steps of establishing financial direction. Your analysis should address (at a minimum) the following:

a. A financial mission statement for yourself

b. Identification of relevant environmental information

c. Establishment of at least 4 financial goals

d. Determination of at least 2-3 objectives for each of your goals paying careful attention to wants vs. needs (be sure to rank the wants)

e. SWOT Analysis (assume that you have just landed your “dream” job but have not begun working)

f. Formulate feasible alternative strategies being mindful to develop and evaluate ways in which you could increase your discretionary cash flows.

g. Select the most appropriate strategy for each objective

V. Investing and Retirement Planning: Assess your current/future savings rate. How much of your gross salary do you save and how do you save (i.e. 401K, savings account, CDs, brokerage account). Are you forgoing any funds through your employer matching program. If so, how much are you forgoing and if you take advantage of all of your employer matching funds, how much does this add to your annual savings rate?

Assess your current/future investment approach. What is your current/future asset allocation between stock, bonds, cash, real estate, etc.? What was your overall rate of return this past year? Given current economic conditions, how are you going to rebalance your portfolio over the course of the next two years?

Assess your current/future retirement planning needs. At what age do you hope to retire? What are your goals during retirement? Assume that at retirement you wish to have between 60- 80% wage replacement ratio. Determine the percentage of income you will need to invest in order to meet this goal. Discuss the feasibility of this goal and the implications of not meeting this goal. What recommendations would you make for yourself to get as close as they possibly can to achieving this goal (your two options if you fall short are either increasing your savings rate or increasing your risk profile to earn a higher rate of return)?

creasing your risk profile to earn a higher rate of return)?