Personal Financial Planning Flashcards

Questions and Answers

What are intermediate goals?

Goals that have no specific timeframe

Goals set for the long-term future

Goals that usually take 3-6 months (or 12) (correct)

Goals that usually take 1-3 months

What are long-term goals?

Something you want to accomplish in the future.

What is personal financial planning?

Decisions including budgeting, investing and retirement planning.

What is money management?

The process of budgeting and saving. Signup and view all the answers

What is a personal financial statement?

Disclosure of an individual's assets, liability, annual income and expenditures. Signup and view all the answers

What is a personal balance sheet?

Summarizes a company's assets, liabilities, and shareholdings at a specific point in time. Signup and view all the answers

What does liability mean?

Being liable (responsible) for something. Signup and view all the answers

What is net worth?

Assets minus liability (the company's value). Signup and view all the answers

What are assets?

Property owned by a person or company. Signup and view all the answers

What are liquid assets?

Cash on hand or an asset that can be easily converted to cash. Signup and view all the answers

Study Notes

Goals Overview

Intermediate Goals: Typically take 3-6 months (or up to 12) to achieve, bridging the gap between short-term and long-term objectives.
Long-Term Goals: Aimed at future accomplishments, often requiring extensive planning and commitment.

Financial Concepts

Personal Financial Planning: Involves making strategic decisions regarding budgeting, investing, and retirement to ensure financial stability and achieve financial goals.
Money Management: The systematic process of budgeting and saving to maintain healthy financial habits and secure future resources.

Financial Statements

Personal Financial Statement: A comprehensive overview detailing an individual's assets, liabilities, annual income, and expenditures, providing insight into net worth and financial health.
Personal Balance Sheet: A snapshot that summarizes a company's assets, liabilities, and shareholder equity at a specific moment, crucial for assessing financial position.

Financial Terminology

Liability: Represents obligations or debts one is responsible for, impacting overall financial stability and net worth.
Net Worth: Calculated by subtracting liabilities from assets, reflecting a person or company's overall value.
Assets: Represent properties owned by an individual or company, contributing to net worth and financial resources.
Liquid Assets: Refers to cash or assets that can be swiftly converted into cash, vital for meeting immediate financial needs.

Description

This quiz consists of flashcards focused on key terms related to personal financial planning. Learn about intermediate and long-term goals, along with essential concepts like money management and budgeting. Perfect for anyone looking to enhance their financial literacy.