Exam 1: Understanding the Financial Planning Process

While you are still working,you should be managing your finances for retirement planning.Which of the following is not a goal of your retirement planning?

A strong economy leads to higher levels of employment.

The first step in the financial planning process is to develop financial plans and strategies to achieve goals.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. Select -[Money | Inflation] is the common denominator for gauging all financial transactions.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. Select -[Stocks | Your house] would be considered to be real property.

Money can be an emotional factor that may affect a person's financial plans.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. Select -For most people,debts [increase constantly | increase and then decrease] during their lifetimes.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. Select -Following an economic trough,the economy will often enter a period of [expansion | contraction].

As the rate of inflation increases,

Professional financial planners

It is possible to draw up one financial plan that will work for most people.

A financial goal that would be important in all stages of the life cycle is creating and maintaining an emergency fund.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. Select -For most people,employee benefits are of [little | major] importance.

Family financial goals should be

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. Select -After reaching adulthood,your financial goals will [stabilize | continue to change].

Consumers affect businesses by their choices of what goods and services to purchase and by choosing whether they will spend or save their incomes.

Which of the following goals is stated in a way that is most useful for developing a financial plan?

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. Select -The average income of household heads increase until age [55 | 65] then income starts decreasing.

Businesses provide

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. Select -[Inflation | Consumer Price Index] is the amount of goods and services each dollar buys at a given point in time.