Monday, September 17, 2012


Discussions about Personal Financial Planning by M. Azim Ulfati.

Though this course has focused on contemporary business, the concepts can be used for improving your personal financial status. Determine three concepts from the previous weeks’ materials that you can directly apply to your personal financial planning.
Analyze the short- and long-term impact of failing to plan for your financial future. 

I think financial planning is a process of setting objectives, assessing assets and resources, estimating future financial needs, and making plans to achieve monetary goals. Many elements may be involved in financial planning, including investing, asset allocation, and risk management. Tax, retirement, and estate planning are typically included as well.
Financial planning plays a starring role in helping individuals get the most out of their money. Careful planning can help individuals and couples set priorities and work steadily towards long-term goals. It may also provide protection against the unexpected, by helping individuals prepare for things such as unexpected illness or loss of income.
I usually use the three concepts for my personal financial planning and they are balance sheet, income statement and budgeting.
I have been using this financial planning for a long time and I have been successful in my personal financial planning so far and I am very happy about it.
I usually make an excel sheet list and estimate the costs; then compare. Am I spending as much for my wants as for my needs? Am I currently making payments on items that i bought to satisfy my wants?
Remember, wants are neither good nor bad. However, you’ll want to personally balance your needs and wants so you can successfully establish a savings plan and good spending plan principles. The savings and spending plans will help you establish and maintain good credit, and work toward establishing long-term financial security.
The balance sheet which I always use is in an excel sheet program where I can only have access with that and this sheet shows the following.
Monthly Needs (items necessary for survival) Cost
Monthly Wants
( items purchased out of desire) Cost
Housing
Equity Loan/ House Association Fees, etc.
Heating
Electricity
Water
Cable
Internet
Telephones (basic service)
Other
Transportation
Gas/Public Transportation/Taxi/Parking
Car insurance
 Other
Insurance
Health (medical and dental)
Other
Child Care
I am single and have never had any kids so I don’t have to worry about this one.
Family
It is only me in the family and have no one so I only care about my self in the USA except my parents who live overseas regarding the following,
Clothing
Laundry/Dry Cleaning
Other $
Education
Tuition $
Books/Papers/Magazines/Supplies $
Lessons (sports, dance, music) $
Other $
Donations
Religious/Charity $
Other (if not payroll deducted) $
Gifts
Birthdays $
Major Holidays $
Other $
Personal
Barber/Beauty Shop $
Beer, Wine, Liquor $
Other $
Entertainment
Movies, Sporting Events, Concerts, Videos, Theater, etc. $
Internet Service $
Cable/Satellite T.V. $
Restaurants $
Lottery Tickets $
Fitness or Social Clubs $
Vacations/Trips $
Managing Your Money 11
Miscellaneous
Money that I send to my parents in Afghanistan.

Home Maintenance, like monthly gutter cleaning, house cleaning, washing and stretching the carpets of my house, flowers, mowing grasses, cutting the tree and other
 Care of Supplies
Hobbies and Crafts
Postage
Indebtedness
Debts
Student Loan
Credit Card (monthly minimum*)
Medical Bills
Personal Loans
FIXED EXPENSES SUBTOTAL:
TOTAL MONTHLY NET INCOME:

My income statement shows that where I get the in come from and how I spent in the past months and how do I spend it, My income statement is my pay check and the check which I receive from my tenants who live in my house.
When I receive that I analyze it that how do I spend it back to pay monthly expenses of the house and my own monthly expenses.
I have been very careful in my financial planning so far based on my analyze I used my budget and have been able to have my favorite  and beautiful house, nice car and so on and I have managed my existing financial obligations so that I keep good credit and good money planning and management skills.
This budget helped me to get to my long term goal and pay my house off and for short term goals, it pays my bills off every month and my budgeting makes me to analyze my future long or short term plans. For example on long term plans it would help me to save money to open up a business in the future and to pay my future college loans off .

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