Copy of 2301_LG1-2 Project

pdf

School

University of California, Riverside *

*We aren’t endorsed by this school

Course

1301

Subject

Finance

Date

Apr 3, 2024

Type

pdf

Pages

Uploaded by MagistrateExplorationKouprey12

PFI 2301: Personal Financial Literacy Information Sheet Project Overview: Throughout the semester, you will be working on an application based scenario on how to apply the course learning goals. All projects will be submitted through Excel. The "Info Sheet" (where you're now) will be the landing page for all of the information to complete each Learning Goal Project. Make sure to keep up with the schedule for the due dates and review the rubrics to make sure you know how each Project will be graded. Let's get started! Unit 1: BASICS - The Tools and the Rules of Personal Finance LG1-Understand financial literacy and how it relates to the financial planning process over the life cycle. LG2-Understand opportunity cost and the time value of money calculations in relation to financial goals. FINANCIAL GOALS (Q8-Q12) - Based on the scenario, type the TVM inputs in the table to figure out what you are solving for (no additional compounding steps here). Short-Term Goal 1: Opened an account with $1500, with the hope to have a total of $2500 saved in an emergency fund within one year (no additional payments). RATE NPER PMT PV FV Goal 2: A credit card balance of $2000 with an 15% rate. The goal is to pay off the credit card by the end of the year. (future is a $0 balance) RATE NPER PMT PV FV Intermediate-Term Goal 3: Student loan balance of $18,000 at 6.5% and making $425 monthly payments. (future is a $0 balance) RATE NPER PMT PV FV Goal 4: Save $15000 in an account with 15% interest for a down payment on a home in 6 years. (no additional payments) RATE NPER PMT PV FV Long-Term Goal 5: Open a Roth IRA at 5% for 20 years and contribute $1500 on a semi-annual basis. RATE NPER PMT PV FV

PFI 2301: Personal Financial Literacy LG1 & 2 Project LG1-Q1 Focus on YOU! 1) De fine financial literacy and 2) how does financial literacy relate to the life cycle stage you're currently in. (type responses, no calculations needed) Financial Literacy is the cognitive understanding of financial components and skills such as budgeting, investing, borrowing, taxation, and personal financial management. For me financial literacy relates to this stage of my life is budgeting for grocerys, rent and my sorority dues. LG2-Q2 Focus on YOU! Create one life and one financial goal using the SMART goal process. State each goal below, then make the goal SMART! (type responses, no calculations needed) Life Goal Owning a dance studio and becoming a dance teacher S I want to be able to teach young dancers all the way to when they graduate highschool M I have been able to measure this by working over the summer with dancers and dance teams and how often i have been requested to work with dancers A I have been able to work with highschool dance teams and soloist with choreographing and cleaning dances R I have been dancing for 13 years and i have been teaching for 4 years now T I want to start working at a dance studio after graduation and own my own studio at 25 Financial Goal save 2,000 for an emergancy fund S Have 2,000 dollars in savings for after i graduate college M start saving 20 dollars a month A create a monthly budgeting plan to fit the 20 dollar savings into it R Have this fund to be able to have some money after i graduate incase something happens T Have at least 1,000 by the end of the next spring semester

Application Time! Facts about Jessica - Complete the following TVM questions (Q3-Q7). Here you will be provided with additional guidance, use the dropdown boxes for 'a-c' to help calculate the TVM problem. Hint: A negative sign can also result in what you're solving for Hint: 1= Annually, 2= Semi-Annually, 4= Qtr., 12= Monthly Note: RATE = % / Compounding # Note: NPER * Compounding # LG2-Q3 Jessica was thinking of making an investment for $6000. She expects it to increase in value at a rate of 3.5% compounded annually for the next five years. How much will the investment be worth at the end of the fifth year? a) Solving For? (select from dropdown) b) Which input is negative? (type TVM input(s) below) c) Compounding Number (select from dropdown) RATE NPER PMT PV FV From the scenario type out the TVM inputs in the cells. FV PV 1 3.50% 5.000 105000 -6000 7126 #N/A LG2-Q4 In college, Jessica borrowed $3200 from her father to study abroad. She paid back $4000 to her father at the end of 4 years. What was the average annual compound rate of interest on the loan from her father? a) Solving For? (select from dropdown) b) Which input is negative? (type TVM input(s) below) c) Compounding Number (select from dropdown) RATE NPER PMT PV FV From the scenario type out the TVM inputs in the cells. RATE FV 1 5.740 4 0 3,200.o 4000 #N/A LG2-Q5 Jessica would like to open a savings account. How many years will it take $2500 to grow to $4500 with an interest rate of 3.0%? a) Solving For? (select from dropdown) b) Which input is negative? (type TVM input(s) below) c) Compounding Number (select from dropdown) RATE NPER PMT PV FV From the scenario type out the TVM inputs in the cells. NPER PV 1 3.000 19.89 0 -2500 4500 #N/A LG2-Q6 Jessica's grandparents opened a savings account when she was born and could access the funds when she turned 18. The account is currently at $16000 and grew at a rate of 2%. What was the initial amount invested? a) Solving For? (select from dropdown) b) Which input is negative? (type TVM input(s) below) c) Compounding Number (select from dropdown) RATE NPER PMT PV FV From the scenario type out the TVM inputs in the cells. PV FV 1 2.000 18 0 11202.55 16000 #N/A LG2-Q7 Jessica would like to go on a cruise in one year. The total trip costs $1500. She is thinking of placing the funds in an account that earns a little interest - she found an account with .5% interest. To reach this goal, how much would Jessica need to contribute to this account monthly? a) Solving For? (select from dropdown) b) Which input is negative? (type TVM input(s) below) c) Compounding Number (select from dropdown) RATE NPER PMT PV FV From the scenario type out the TVM inputs in the cells. PMT FV 1 3.5000 5 0.00 6000 7126 #N/A Application Time! 1) You will type the TVM inputs in the table provided from the "Info Sheet". 2) Mirror the inputs from the "Info Sheet" to the TVM cells provided. 3) Within the TVM cells, if needed, compound. 4) In the "ANSWER" cell show us your TVM calculation. Note: RATE = % / Compounding # Note: NPER * Compounding # LG2-Q8 Goal 1: Opened an account with $1500, with the hope to have a total of $2500 saved in an emergency fund within one year (no additional payments). Compounding Number (select from dropdown) RATE NPER PMT PV FV ANSWER What would the quarterly interest rate be needed to reach this goal?° 1 14 4 0 1000 2000 42.67% #N/A LG2-Q9 Goal 2: A credit card balance of $2000 with an 15% rate. The goal is to pay off the credit card by the end of the year. (future is a $0 balance) Compounding Number (select from dropdown) RATE NPER PMT PV FV ANSWER What would be the monthly payment to reach this goal? 1 15.0000 12 12 -2000 0 180.52 #N/A LG2-Q10 Goal 3: Student loan balance of $18,000 at 6.5% and making $425 monthly payments. (future is a $0 balance) Compounding Number (select from dropdown) RATE NPER PMT PV FV ANSWER How many months will it take to complete this goal? 1 6.5000 7 12 425 -18000 48.24 #N/A LG2-Q11 Goal 4: Save $15000 in an account with 15% for a down payment on a home in 6 years. (no additional payments) Compounding Number (select from dropdown) RATE NPER PMT PV FV ANSWER How much must be deposited today in the account to reach this goal? 1 15.00 6 0 -15000 0 6484.91 #N/A LG2-Q12 Goal 5: Open a Roth IRA at 5% for 20 years and contribute $1500 on a semi-annual basis. Compounding Number (select from dropdown) RATE NPER PMT PV FV ANSWER What is the potential balance of this account in 20 years? 1 5.0000 2 20 -1500 0 101103.83

Your preview ends here

Eager to read complete document? Join bartleby learn and gain access to the full version