💰

Personal Finance Course Overview

Aug 22, 2024

Personal Finance Lecture Notes

Instructor Introduction

  • Instructor: Mr. Wallenberg
  • Institution: Missouri State University
  • Course Type: Dual credit personal finance course

Course Requirements

  • Meet Missouri personal finance competencies through high school.
  • Complete requirements set by Missouri State University:
    • Enroll on Blackboard after obtaining Missouri state ID.
    • Access course information, readings, quizzes, and instructions on Blackboard.
    • Prepare a personal financial plan and take a final exam.

Course Topics Overview

  1. Goal Setting
  2. Budgeting
  3. Credit
  4. Insurance
  5. Investment Basics

Goal Setting

Understanding Goals

  • Goals help define what we want to achieve.
  • Goals can validate progress and accountability.

Types of Goals

  • Short-term goals: Achievable within 1 year.
  • Intermediate goals: Achievable in 1 to 5 years.
  • Long-term goals: Achievable in more than 5 years.

Example of Goals

  • Long-term goal: Save $10,000 for an emergency fund in 5 years.
  • Intermediate goal: Save $1,000 in 1 year to support the long-term goal.

Financial Goals vs Personal Goals

  • Financial goals involve specific dollar amounts and timelines.
  • Personal goals may include achievements in life or career aspirations.

SMART Goals Framework

  • Specific: Clearly define the goal.
  • Measurable: Ensure the goal can be quantified.
  • Attainable: The goal must be realistic based on personal circumstances.
  • Realistic: Avoid frustration by setting achievable goals.
  • Time-sensitive: Set a deadline for achieving the goal.

Examples of SMART Goals

  1. Car Purchase:
    • Goal: Save $2,500 for a down payment on a Chevrolet Malibu in 3 years.
  2. Weight Loss:
    • Goal: Lose 10 lbs in 6 weeks.
  3. Million Dollar Savings:
    • Goal: Save $1 million over 45 years by saving $500/month.

Breakdown of Specific Financial Goals

  • Savings Goal: Save $4,000 for emergency savings in 12 months.
  • Home Ownership Goal: Save $15,000 for a down payment on a $150,000 house in 10 years.
  • Insurance Goal: Save $11,000 in 12 months to raise insurance deductibles.
  • Retirement Goal: Save for a monthly income of $5,000 for 20 years.
    • Determine total amount needed and monthly saving contributions.

Monitoring Goals

  • Regularly review and adjust goals to reflect changes in financial situation and inflation.

Conclusion

  • Utilizing SMART goals will help in achieving financial success.
  • Adapt goals as necessary to remain on track towards financial objectives.

Full transcript