BSNS 3150(01) FINANCIAL PLANNING

Three Semester Hours, Fall 2008

Jerrald M. Fox, Ph.D., CFP, Instructor

Office:Hardacre 205    Ph:641-4361    E-mail:jmfox@anderson.edu

 

Office hours may vary from week to week.  An appointment sign-up sheet is posted on my office door.  I welcome your visits, so come by often to discuss this course, your future, or anything else of interest to you.

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Course Description

A detailed study of family financial planning both for personal benefit and to assist those pursuing careers in the financial services industry.  Topics include career management, budgeting, tax planning, consumer credit, shopping/buying strategies, insurance planning, saving and investing, and retirement and estate planning.

 

Text

Focus on Personal Finance,  Kapoor, Dlabay, Hughes, 2ed., McGraw-Hill Irwin, 2008.  ISBN 978-0-07-353063-5

 

Supplementary Reading

The Wall Street Journal, Money Magazine, Kiplinger’s Personal Finance Magazine, Consumer Reports and the many personal finance websites available on the internet.  These are great resources for preparing the two papers required in this course.  You will be required to research these sources each week to locate current information on the topics we cover in class.  Bring your comments and questions to class and be ready to contribute to our group discussions.  I will call on each student several times over the semester and ask you to share your findings and begin our discussions.

 

Course Objectives

1.  To explore the many financial challenges and opportunities which you may face both now as a student and on throughout your adult life.

 

2.  To provide you with information and to help you develop the skills and confidence to manage your own financial activities and those of others should you pursue a career in financial services.

 

3.  To challenge you to examine your commitments, values and goals from eternal perspectives.  To consider what the Bible and the personal guidance of the Holy Spirit can teach you about God’s plans for your use of all of your abilities and resources.

 

Course Requirements

1.      Attendance/Participation:  To paraphrase Woody Allen: Ten per cent of success is due to talent and preparation; the other ninety per cent is due to just showing up on time.  I’ll argue with his percentages, but agree that all of academic success is due to being in class, on time, and prepared to discuss the topics of the day.  I will regularly take attendance and call on students to lead class discussions.  Your final grade will be determined not only from your exam scores, but also from my subjective evaluations of your preparation and your individual contributions to the learning environment of our class.  (See the note under Final Grading below.)

 

2.      Readings:  You are expected to complete all reading assignments before the dates noted in this syllabus.  Our classes can only be times of rich learning if all students come prepared with reading notes, questions, and some personal consideration of topics to be discussed.  Our text is just the starting point, however.  You should also regularly look through the recommended reading supplements and internet sources to find the most current information about each topic in our study.

 

3.      Major Financial Event Research Paper:  Listed below are four common financial events. You may work with a classmate and turn in a joint research paper if you wish.  But, choose a partner carefully.  Both students will receive the same grade regardless of individual contribution.  Choose one event from this list:

 

·         The complete costs of a wedding, reception, and honeymoon with research of issues, options, choices, and how expenses will be divided among all parties

·         The complete costs of having a baby and providing all care for its first year

·         A detailed description of the process and costs of purchasing your first home including shopping strategies, financing, inspections, closing costs, etc.

·         A comparison of the costs of buying vs. leasing a new car for a three year period including shopping strategies, financing, licensing, insuring, and all regular maintenance necessary to have dependable transportation

 

After choosing your topic, conduct a detailed research study and present your findings in a report in this required format:

 

 

 

 

No notebooks or binders please!  Follow the required format below and assemble your clearly printed report with one staple in the upper left corner.

 

Title Page with your name, the date submitted, and your topic

 

I.      Description of the topic you have chosen with emphasis on the issues you must consider when you face this event,

II.      Complete listing of the options available to you for dealing with this event,

III.      Details regarding your research of both the expenditures required and the opportunity costs associated with each option you have listed in part II, and

IV.      A detailed description of the strategies you would choose to make this event both satisfying and affordable. 

 

Bibliography of all of your research sources.

 

 

Your research base should include resources from printed library materials and current information found on internet sites.  You must also conduct at least two personal interviews of financial professionals and others with experience in managing the details of this event.  For example, if you research home buying you will want to interview realtors, mortgage lenders, and recent home buyers.

 

Then, prepare a typewritten report of your research findings.  Your report must reference at the very least three published resources beyond your text and at least two personal interviews.   There should, then, be a minimum of five sources listed in your bibliography.  Throughout your report you must give proper citations for the sources of all facts and quotations.  This is a research paper.  Good research takes time and effort.  Good report writing requires proofreading, editing, and rewriting.  Start early!  Turn in your best work before the due date.

 

PLEASE NOTE: You may submit your research report to the instructor anytime until 8 a.m. Monday October 13, 2008.  Students whose reports are not received by this time will be assigned a grade of zero.  No late papers will be accepted.

 

4.  Three-Year Financial Plan:  You will conclude your semester’s study by personalizing all that you have learned in the form of a detailed financial plan for your first three years after graduation.  A guide sheet with specific requirements is attached at the end of this syllabus.

 

PLEASE NOTE: You may turn in your three-year financial plan anytime until  8 a.m. Friday November 21, 2008.  No late papers will be accepted.

 

SPECIAL NOTE FOR THESE TWO WRITING ASSIGNMENTS: Plagiarism of any form (submitting another's work as your own) will result in a grade of double-zero as stipulated by the Anderson University Student Life Handbook.

 

5.  Exams:  There will be eight unit exams during the semester.  Exam questions may include material presented in class discussions, by guest speakers, and from your textbook.  In other words, you must attend every class session and take good notes both in class and from assigned readings to be prepared to do well on exams.

 

The exams will not be cumulative, but instead will cover in detail the topics of each unit.  The format of each exam will vary according to the information and skills covered in that unit. 

 

Final Grading

Exams, 8@10%                      80%                                        

Research Paper                     10%                

Three Year Plan                    10%                

* Instructor's Evaluation     +/-5%

 

*Based upon my subjective evaluations of your preparation and participation in class as noted in requirement 1 above, I reserve the right to adjust your final course score by as much as 5% if I believe it necessary to give an accurate final evaluation of your overall performance in this course.  This will be used in unusual circumstances only and does not mean that all grades will be “rounded up” to the next higher grade.

 

 

GRADING SCALE

                                    B+ = 87-89.9%           C+ = 77-79.9%

A   = 93%+                 B   = 83-86.9%            C   = 73-76.9%           D = 60 - 69.9%

A- = 90-92.9%            B-  = 80-82.9%           C-  = 70-72.9%           F  = below 60%

           

 

TENTATIVE CLASS SCHEDULE

Dates                          Topics                                                                        Chapter

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September

3                      Introduction to course, materials, and resources

5                      Time value of money review                                            

8-12                 Personal Financial Planning in Action                                         1

15-17               Money Management Skills                                                             2

19                    Exam #1

 

22-26               Tax planning and preparation                                                       3

TENTATIVE CLASS SCHEDULE

Dates                          Topics                                                                        Chapter

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September

29                    Exam #2

 

October

1-3                   Savings and Payment Services                                                      4

6-10                 Consumer Credit                                                                             5

13                    Major Event Research Papers due by 8 a.m.

                        Review for Exam #3

15                    Exam #3

 

17-22               Consumer purchasing strategies and car buying                       6

24                    Mid-Fall Holiday

27-31               The Finances of Housing                                                                7

 

November

3                      Exam #4

5                      Home and automobile insurance                                                  8

7                      Personal research for insurance buying

10                    Insurance basics, review for exam

12                    Exam #5

 

14-17               Health and disability insurance                                                    9

19-21               Life insurance                                                                                   10

21                    Three-year financial plans due by 8 a.m.

24                    Exam #6

 

26-30               Thanksgiving Break

           

December     

1-3                   Investing Basics/Stocks and Bonds                                              11-12

3-5                   Investing in mutual funds                                                              13

8                      Exam #7

                       

10                    Retirement Planning                                                                       14

12                    Estate Planning                                                                                14

 

16                    Exam #8, Tuesday, 7:40 – 9:20 a.m.

 

 

See next page for requirements for Three-Year Financial Plan…

Three Year Financial Plan - Outline and Requirements

 

PLEASE NOTE: You may turn in your financial plan anytime before 8 a.m. Friday November 21, 2008.  None will be accepted late for any reason.

 

Please take this project seriously.  This is not just another college paper.  This is your roadmap for your life in the near future!  Use the best information from your entire semester of study.  Be specific about where you want to go and create your plan to get there.

 

Your grade will be determined by how well you demonstrate what you have learned in this course, the quality of your personal research, and the clarity of your writing.

 

Your paper must be in the following format:

 

Section I - General Information

 

  1. Your name
  2. Time period covered (dates)
  3. Anticipated marital status, children during this time period
  4. Career plan with anticipated positions held during this time period
  5. Research of opportunities in your career field with citations of information sources (interview professionals in your field)
  6. Expected gross salary and other income with citations of your information sources
  7. Expected take-home pay (cite your sources and show your tax and benefit calculations)

 

Section II - Financial Goals

 

First, discuss the personal commitments upon which your goals will be made.  Whom and what do you value most and how will your plans serve them?  Then, discuss your goals for paying off your debts, housing, transportation, lifestyle, travel, savings, investments, and anything else you plan to accomplish which will require the use of money.  For example, do you plan to go to your roommate’s wedding?  Rent a tux?  Bring a gift?  Plan for it.  For each goal discuss the following:

 

  1. When you plan to reach the goal
  2. How much this goal will cost at that time (consider inflation)
  3. How you will pay for this goal (savings, credit, etc.)
  4. Where this goal will fit in your monthly budgets (Section III)

 

Section III - Monthly Budget for Three Years

 

Your budget sheet should have three columns, one for the budgeted monthly dollar amounts of income and expenses during each year of this three-year plan.  (No need for percent, actual and variance columns.)  Assume that your income and expenses will remain the same throughout each year and only change with the new year.  It should look something like this:

 

Monthly Budget for Chris Student

 

                                                            2009                2010                2011

Projected Inflows

Salary                                                 2000                2200                2500

Investment income                            100                  125                  200

 

Projected Outflows

Tithe, Offerings, Charity

Tithe to church                                   210                  240                  275

AU Student Scholarships                    20                    30                    40

 

Emergency Fund and Savings

Emergency fund savings                  100                  150                  200

Savings for auto insurance               110                  120                  130

Savings for vacation                                        50                    50                    50

 

Fixed Expenses

Rent                                                      600                  625                  650

Student Loans                                     300                  300                  300

  Etc…..

           

All amounts should show your planned monthly inflows and outflows of cash.  All of the savings and expenditures necessary to meet your goals from Section II should be included here in expense or goals sections.

 

The key?  Based upon the expected income from your career choice, show how you will budget your expenditures and savings to fulfill your commitments to God, your family, and your goals.  You can accomplish the things you value most if you plan for them and then stick to your plan.