Assignment 4: Saving and Investing

The one financial goal that I plan to accomplish within the next two years is to buy a house. The first resource on achieving this goal that I would change is to take my food to work everyday instead of eating out. Another resource that would help me stay focused is by getting a check register book to help me keep track of what I am spending on a daily basis. I expect to put four hundred fifty dollars in savings every two weeks to help me save for my dream home. Minimizing my wants and only buying my actual needs will make an enormous difference. Within the first year of savings my goal is to have a nice down payment of $10,800. During the approach of the second year, I would look for a home that is in the price range of $80,000-$100,000 and

1. Describe a real or made up but realistic situation that could cause you or someone you know to have to use money from a financial reserve. (3-6 sentences. 2.0 points): having to get a car. Another situation could be house repairs.

1. Describe two examples of important things that financial planning skills can help you do, and explain why these things are important to you personally. (4-6 sentences. 2.0 points)

The process of transferring the cost of metal ores and other minerals removed from the earth to an

1. The financial choices we make impact our economy. Think of a recent item you purchased. What factors influenced your decision in making this purchase? Did this purchase impact your local economy? Explain why or why not.

1. Describe two examples of important things that financial planning skills can help you do, and explain why these things are important to you personally. (4-6 sentences. 2.0 points)

1. Describe a real or made up but realistic situation that could cause you or someone you know to have to use money from a financial reserve. (3-6 sentences. 2.0 points)

My parents receive an earned income, meaning they work for it, unlike unearned income like child support and disability. My mom works as a Human Resources Director; she over sees all investigations in her facility and hires and fires people. My dad works as an Operations Sales Manager, so he over sees all of the different sales. They both have salary wages, so their income isn’t based on hours.

-Martin Industries just paid an annual dividend of $1.30 a share. The market price of the stock is $36.80 and the growth rate is 6.0 percent. What is the firm's cost of equity?

Avoiding money problems is fairly simple; don’t take on more debt than you can handle, always pay your bills on time, and be sure that you have an emergency fund. An emergency fund is key to not allowing something totally unexpected to lead to financial meltdown. If you start planning and saving today, you will be prepared anytime something urgent comes up. Build your emergency fund painlessly by following these tips:

Also briefly indicate how your advice would change if other assets became available to the investor.

The last few years have displayed no shortage of uncertain times in the market, economy and rate of employment. Thus, in this day and age, planning a retirement strategy requires one to engage in strategies that are both smart and safe. Given the modest amount of money that I have to invest ($25,000), I would like to avoid betting big on any one asset in the future. Thus, for me, given the attitudes that I have about the stock market and the economy in the nation and world, I should probably work with a fund manager so that I can have "…the freedom to move nimbly in and out of almost any asset class, anywhere in the world" (Marte, 2011). This way, I don't have to put all of my confidence in just a couple forms of stock; by spreading my money around I'll be able to establish a bigger safety net and a greater amount of peace of mind. The types of investments I would most likely make would be in 'world allocation' funds which refer to portfolios that create a blend of stocks, bonds, currencies and other assets (Marte, 2011). According to Marilyn Plum, a leader in portfolio management at Ballou Plum Wealth Advisors, "Things move very quickly and it just gives them a lot of flexibility to move where the growth is," (Marte, 2011). These world allocation funds have been steadily growing in popularity and I truly think it's because of the uncertain economic times we've been in. While the economy is bound to stabilize at some point, until it

Assume that one of Philip’s clients is a married man, aged 36 with two young children, who wishes to reallocate a significant portion of his retirement funds that are currently invested in certificates of deposit. Philip recommends a growth investment, and he identifies the three representative possibilities shown in Table A.

Mutual funds are an easy, convenient way to invest, without having to worry about choosing individual stocks. A mutual fund can be defined as a single portfolio of stocks, bonds, and/or cash managed by an investment company on behalf of many investors. The investment company manages the fund, and sells shares in the fund to individual investors. When one invests in a mutual fund, they become a part-owner of a large investment portfolio, along with all the other shareholders of the fund. The fund manager invests the contributions when shares are purchased, along with money from the other shareholders. Every day, the fund manager counts up the value of all the fund's holdings, figures out how many shares have been purchased by

helps a person to manage his personal finances and also to describe the three products of