Personal finance blogPosted by Vind Shea on February 2nd, 2021 I suggest to split chapter 4 into two chapters – a chapter to cover time value of money and another to cover measuring and evaluating risk. The topics are appropriate for an undergraduate personal finance or financial planning course, it also serves as a good reference book for anyone who wants to plan his/her personal finance serious. Two very important topics in finance, time value of money and risk, need to be covered in more depth. Chapter 9 “buying a home” should discuss the advantages and disadvantages of renting versus buying and covers refinancing in more detail. These will help people make better decisions when it comes to buying a home and refinancing a mortgage. Excel is widely used in Business and Finance including in financial planning and analysis. Including estimate my tax refund from my last paystub and exercises will help readers understand how personal finance can be managed and how financial planning can be done in Excel. According to a survey done by Harris Interactive, 99% of the adults agreed that personal finance should be taught in schools. As of 2015, 17 out of 50 states in the United States requires high school students to study personal finance before graduation. Financial authorities and the American federal government had offered free educational materials online to the public. For example, a study done by Bell, Gorin and Hogarth stated that those who undergo financial education were more likely to use a formal spending plan. Financially educated high school students are more likely to have a savings account with regular savings, fewer overdrafts and more likely to pay off their credit card balances. One of the most important tenets of personal finance is systematic saving. Say your net earnings are ,000 per year and your monthly living expenses—housing, food, transportation, and the like—amount to ,200 per month. Restraint is that final big-picture skill of successful business management that must be applied to personal finances. Earning 0,000 a year won't do you much good if you spend 5,000 annually. Learning to restrain spending on non-wealth-building assets until after you've met your monthly savings or debt-reduction goals is crucial in building net worth. Retirement may seem like a lifetime away, but it arrives much sooner than you’d expect. Experts suggest that most people will need about 80% of their current salary in retirement. The younger you start, the more you benefit from what advisors like to call the magic of compounding interest—how small amounts grow over time. If your employer offers a 401 or 403 plan, start paying into it right away, especially if they match your contribution. Take time to learn the difference between a Roth 401 and a traditional 401, if your company offers both. If your employer offers a 401 or 403 plan, start paying into it right away, especially if they match your contribution. This book covers everything that I cover in my personal finance and financial planning courses, with one additional chapter related to careers, which is an interesting addition. I would have liked to see a section dedicated to paying for college. The topic of investing in education is sprinkled throughout the text but is not in its own section. Financing education is as important as buying a house or car, which each have their own sections, so it would have been good to see that as a stand-alone section. Also, I'd like to see a section on FinTech and the use of online tools. Most of my students use apps like Acorns, Robin Hood, Square, and Venmo, etc.Like it? Share it! |