Personal Financial Planning

Program Credit : PGPM : 3 Class Sessions : 2012 : 30

Course Code : SL IV 601

AIM The Course is aimed at enabling the student understand the issues involved in planning finances and investments at a personal level, and be in a position to provide advise on the issues.

Learning Outcomes 1. 2. 3. 4. 5. 6. 7. 8. Understand the personal financial planning process, put a monetary value on financial goals using time value of money, prepare a personal balance sheet and draw a cash budget to control spending Prepare a tax return and implement a tax planning strategy Implement a plan to buy an automobile and a house by a proper financing/borrowing/ mortgage plan Develop a plan to establish a strong credit history and choose the right credit cards and recognize their advantages and disadvantages Develop awareness on different types of consumer loans. Become familiar with various types of insurance policies and choose the best to suit the individual needs Develop saving strategy and manage an investment portfolio of securities like equity, bonds, mutual funds, gold, etc. Understand retirement planning and estate planning.

REFERENCE BOOKS Personal Financial Planning Taxmanns Direct Tax Laws & Practice Personal Financial Planning Personal Investment and Tax Planning Yearbook (Latest) Income Tax- Law & Practice

AUTHOR / PUBLICATION Lawrence J.Gitman and Michael D.Joehnk, South-western Thomson Learning Dr. Vinod K. Singhania & Dr. Kapil Singhania Hallman, G Victor / Rosenbloom, Jerrry S. McGraw Hill Yasaswy, N J , Vision Publication Edition Gaur, V.P. / Narang, D.B. Kalyani Publishers

Detailed Syllabus Understanding the financial planning process - Planning for a life time the planning environment Financial statements and plans time value of money preparing personal income statement and balance sheet making cash budgets Managing taxes principles of income taxes Computation of Salary, Rental income & Capital Gains, Other Income- filing returns tax planning other forms of personal taxesProvisions of Wealth Tax Act. Making decisions regarding purchase of automobiles and houses deciding whether to lease or buy finding an affordable house housing finance, to buy new or old automobile, vehicle financing options from banks, EMI Managing credit opening bank accounts, loan accounts, overdraft accounts, consumer loans, using credit carefully, CIBIL, EMI for loans Managing insurance needs basic insurance concepts deciding on the amount of life insurance required key features of life insurance policies buying insurance types and sources of health insurance plans principles of property insurance automobile insurance other types of insurance; Managing investments investment planning securities markets transacting in the securities markets online investing mutual funds- Financial Planners Advice, Portfolio management & tracking, Risk Measures like Sharpes ratio, Treynors ratio, Jensens measure, etc. Financial Advice for Entrepreneurs: Financial Planning & Tax planning for Entrepreneurs and Enterprise, exploring different fund raising options. Alternate Investment Options Art, Gold, Antiques, Commodities, Real Estate, Charity, Investments outside India. Retirement planning estimating needs at retirement social security pension plans and retirement plans annuities, Reverse Mortgage Estate planning wills trusts gift taxes estate taxes and tax planning

Marketing of Financial Products: Relationship Marketing, Selling in a competitive environment, Personal Selling skills. Case studies: relevant case studies at the end of each chapter (book by Lawrence Gitman) Suggested Schedule of Session Topic Understanding the Financial Planning Process Managing Taxes and Tax Planning Decisions Regarding Automobiles and Housing Managing Credit- Consumer Loans & other forms of Financing Health ,Property & life Insurance Financial Advice for Entrepreneurs Planning for Investments Alternate Investment Options Investing in Stocks and Bonds Investing in Mutual Funds Planning for Retirement Estate Planning Marketing of Financial Products Total Sessions No. of Sessions 2 6 2 2 3 2 2 1 2 4 1 1 2 30