Financial strategies one should develop and financial problems one must avoid. Introduction: Financial strategies refer to the way through which a family or a person achieves their future financial security. Financial security refers to the situation where a person has enough money to provide himself and his own family the basic necessities of life.

Question

Want to see more full solutions like this?

Answer 1

Question

Chapter 1, Problem 1PA

Summary Introduction

To discuss:

Financial strategies one should develop and financial problems one must avoid.

Introduction:

Financial strategies refer to the way through which a family or a person achieves their future financial security. Financial security refers to the situation where a person has enough money to provide himself and his own family the basic necessities of life.

Expert Solution & Answer

Explanation of Solution

The following financial strategies should be adopted for sound financial planning:

Minimize your taxes:
One of the financial strategies is to reduce taxes through legal way. It means learning about tax system so that one can manage his/her portfolio in a way that he /she need not to pay high taxes.
Invest wisely:
It means that one should invest wisely while keeping in his minds his goals and be careful about the shady investment that are available outside in the world.
Save for retirement:
One may not think much about their retirement right now but it is essential to cover your retirement because nobody wants to leave their old age with no money in the hand. So, one must consider about their retirement during their financial planning.
Protect your asset:
A good financial plan is that which protect your current asset as well. So, one should take adequate insurance at low cost to protect their assets.
Aggregate wealth for special expenses:
A good financial planner is that who keeps in mind the special expense that if not planned successfully can erode their wealth completely. Special expenses are marriage expense and college fees, etc.
Plan for uncertainty:
It may sound funny that how one can plan for an event that he even does not know will exist but one should keep in mind the future uncertainties and plan some extra wealth for that uncertain event. Uncertain event can be accident of a person. Uncertain event can be an event which could reduce family income sharply and increase their expense sharply.

The mistakes one should avoid are:

The mistakes that person can make is that he/she does not consider about tax and end up paying more tax than required.
Spend more than what they need to end up having no money for their investments.
It may happen that whatever amount of insurance a person takes is not sufficient enough for that purpose.
Not thinking about the future contingencies.

Conclusion

One should keep in mind, things like future requirement, contingencies and obligation and other things while planning financially and avoid doing things like planning according to taxes, splurge and insufficient insurance and many more.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Students have asked these similar questions

A. What is the amount of the annuity purchase required if you wish to receive a fixed payment of $200,000 for 20 years? Assume that the annuity will earn 10 percent per year.B. Calculate the annual cash flows (annuity payments) from a fixed-payment annuity if the present value of the 20-year annuity is $1 million and the annuity earns a guaranteed annual return of 10 percent. The payments are to begin at the end of the current year.C. Calculate the annual cash flows (annuity payments) from a fixed-payment annuity if the present value of the 20-year annuity is $1 million and the annuity earns a guaranteed annual return of 10 percent. The payments are to begin at the end of five years. I need help solving question C on a financial calculator.

John wants to buy a property for $105,000 and wants an 80 percent loan for $84,000. A lenderindicates that a fully amortizing loan can be obtained for 30 years (360 months) at 6 percentinterest; however, a loan fee of $3,500 will also be necessary for John to obtain the loan.a. How much will the lender actually disburse?b. What is the APR for the borrower, assuming that the mortgage is paid off after 30 years (fullterm)?c. If John pays off the loan after five years, what is the effective interest rate? Why is it differ-ent from the effective interest rate in (b)?d. Assume the lender also imposes a prepayment penalty of 2 percent of the outstanding loanbalance if the loan is repaid within eight years of closing. If John repays the loan after fiveyears with the prepayment penalty, what is the effective interest rate?

It is now January 1. You plan to make a total of 5 deposits of $500 each, one every 6 months, with the first payment being made today. The bank pays a nominal interest rate of 14% but uses semiannual compounding. You plan to leave the money in the bank for 10 years. Round your answers to the nearest cent. 1. How much will be in your account after 10 years? 2. You must make a payment of $1,280.02 in 10 years. To get the money for this payment, you will make five equal deposits, beginning today and for the following 4 quarters, in a bank that pays a nominal interest rate of 14% with quarterly compounding. How large must each of the five payments be?

Answer 2

Question

Chapter 1, Problem 1PA

Summary Introduction

To discuss:

Financial strategies one should develop and financial problems one must avoid.

Introduction:

Financial strategies refer to the way through which a family or a person achieves their future financial security. Financial security refers to the situation where a person has enough money to provide himself and his own family the basic necessities of life.

Expert Solution & Answer

Explanation of Solution

The following financial strategies should be adopted for sound financial planning:

Minimize your taxes:
One of the financial strategies is to reduce taxes through legal way. It means learning about tax system so that one can manage his/her portfolio in a way that he /she need not to pay high taxes.
Invest wisely:
It means that one should invest wisely while keeping in his minds his goals and be careful about the shady investment that are available outside in the world.
Save for retirement:
One may not think much about their retirement right now but it is essential to cover your retirement because nobody wants to leave their old age with no money in the hand. So, one must consider about their retirement during their financial planning.
Protect your asset:
A good financial plan is that which protect your current asset as well. So, one should take adequate insurance at low cost to protect their assets.
Aggregate wealth for special expenses:
A good financial planner is that who keeps in mind the special expense that if not planned successfully can erode their wealth completely. Special expenses are marriage expense and college fees, etc.
Plan for uncertainty:
It may sound funny that how one can plan for an event that he even does not know will exist but one should keep in mind the future uncertainties and plan some extra wealth for that uncertain event. Uncertain event can be accident of a person. Uncertain event can be an event which could reduce family income sharply and increase their expense sharply.

The mistakes one should avoid are:

The mistakes that person can make is that he/she does not consider about tax and end up paying more tax than required.
Spend more than what they need to end up having no money for their investments.
It may happen that whatever amount of insurance a person takes is not sufficient enough for that purpose.
Not thinking about the future contingencies.

Conclusion

One should keep in mind, things like future requirement, contingencies and obligation and other things while planning financially and avoid doing things like planning according to taxes, splurge and insufficient insurance and many more.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 3

Question

Chapter 1, Problem 1PA

Summary Introduction

To discuss:

Financial strategies one should develop and financial problems one must avoid.

Introduction:

Financial strategies refer to the way through which a family or a person achieves their future financial security. Financial security refers to the situation where a person has enough money to provide himself and his own family the basic necessities of life.

Expert Solution & Answer

Explanation of Solution

The following financial strategies should be adopted for sound financial planning:

Minimize your taxes:
One of the financial strategies is to reduce taxes through legal way. It means learning about tax system so that one can manage his/her portfolio in a way that he /she need not to pay high taxes.
Invest wisely:
It means that one should invest wisely while keeping in his minds his goals and be careful about the shady investment that are available outside in the world.
Save for retirement:
One may not think much about their retirement right now but it is essential to cover your retirement because nobody wants to leave their old age with no money in the hand. So, one must consider about their retirement during their financial planning.
Protect your asset:
A good financial plan is that which protect your current asset as well. So, one should take adequate insurance at low cost to protect their assets.
Aggregate wealth for special expenses:
A good financial planner is that who keeps in mind the special expense that if not planned successfully can erode their wealth completely. Special expenses are marriage expense and college fees, etc.
Plan for uncertainty:
It may sound funny that how one can plan for an event that he even does not know will exist but one should keep in mind the future uncertainties and plan some extra wealth for that uncertain event. Uncertain event can be accident of a person. Uncertain event can be an event which could reduce family income sharply and increase their expense sharply.

The mistakes one should avoid are:

The mistakes that person can make is that he/she does not consider about tax and end up paying more tax than required.
Spend more than what they need to end up having no money for their investments.
It may happen that whatever amount of insurance a person takes is not sufficient enough for that purpose.
Not thinking about the future contingencies.

Conclusion

One should keep in mind, things like future requirement, contingencies and obligation and other things while planning financially and avoid doing things like planning according to taxes, splurge and insufficient insurance and many more.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 4

Question

Chapter 1, Problem 1PA

Summary Introduction

To discuss:

Financial strategies one should develop and financial problems one must avoid.

Introduction:

Financial strategies refer to the way through which a family or a person achieves their future financial security. Financial security refers to the situation where a person has enough money to provide himself and his own family the basic necessities of life.

Expert Solution & Answer

Explanation of Solution

The following financial strategies should be adopted for sound financial planning:

Minimize your taxes:
One of the financial strategies is to reduce taxes through legal way. It means learning about tax system so that one can manage his/her portfolio in a way that he /she need not to pay high taxes.
Invest wisely:
It means that one should invest wisely while keeping in his minds his goals and be careful about the shady investment that are available outside in the world.
Save for retirement:
One may not think much about their retirement right now but it is essential to cover your retirement because nobody wants to leave their old age with no money in the hand. So, one must consider about their retirement during their financial planning.
Protect your asset:
A good financial plan is that which protect your current asset as well. So, one should take adequate insurance at low cost to protect their assets.
Aggregate wealth for special expenses:
A good financial planner is that who keeps in mind the special expense that if not planned successfully can erode their wealth completely. Special expenses are marriage expense and college fees, etc.
Plan for uncertainty:
It may sound funny that how one can plan for an event that he even does not know will exist but one should keep in mind the future uncertainties and plan some extra wealth for that uncertain event. Uncertain event can be accident of a person. Uncertain event can be an event which could reduce family income sharply and increase their expense sharply.

The mistakes one should avoid are:

The mistakes that person can make is that he/she does not consider about tax and end up paying more tax than required.
Spend more than what they need to end up having no money for their investments.
It may happen that whatever amount of insurance a person takes is not sufficient enough for that purpose.
Not thinking about the future contingencies.

Conclusion

One should keep in mind, things like future requirement, contingencies and obligation and other things while planning financially and avoid doing things like planning according to taxes, splurge and insufficient insurance and many more.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 5

Chapter 1, Problem 1PA

Summary Introduction

To discuss:

Financial strategies one should develop and financial problems one must avoid.

Introduction:

Financial strategies refer to the way through which a family or a person achieves their future financial security. Financial security refers to the situation where a person has enough money to provide himself and his own family the basic necessities of life.

Expert Solution & Answer

Explanation of Solution

The following financial strategies should be adopted for sound financial planning:

Minimize your taxes:
One of the financial strategies is to reduce taxes through legal way. It means learning about tax system so that one can manage his/her portfolio in a way that he /she need not to pay high taxes.
Invest wisely:
It means that one should invest wisely while keeping in his minds his goals and be careful about the shady investment that are available outside in the world.
Save for retirement:
One may not think much about their retirement right now but it is essential to cover your retirement because nobody wants to leave their old age with no money in the hand. So, one must consider about their retirement during their financial planning.
Protect your asset:
A good financial plan is that which protect your current asset as well. So, one should take adequate insurance at low cost to protect their assets.
Aggregate wealth for special expenses:
A good financial planner is that who keeps in mind the special expense that if not planned successfully can erode their wealth completely. Special expenses are marriage expense and college fees, etc.
Plan for uncertainty:
It may sound funny that how one can plan for an event that he even does not know will exist but one should keep in mind the future uncertainties and plan some extra wealth for that uncertain event. Uncertain event can be accident of a person. Uncertain event can be an event which could reduce family income sharply and increase their expense sharply.

The mistakes one should avoid are:

The mistakes that person can make is that he/she does not consider about tax and end up paying more tax than required.
Spend more than what they need to end up having no money for their investments.
It may happen that whatever amount of insurance a person takes is not sufficient enough for that purpose.
Not thinking about the future contingencies.

Conclusion

One should keep in mind, things like future requirement, contingencies and obligation and other things while planning financially and avoid doing things like planning according to taxes, splurge and insufficient insurance and many more.

Answer 6

Chapter 1, Problem 1PA

Summary Introduction

To discuss:

Financial strategies one should develop and financial problems one must avoid.

Introduction:

Financial strategies refer to the way through which a family or a person achieves their future financial security. Financial security refers to the situation where a person has enough money to provide himself and his own family the basic necessities of life.

Expert Solution & Answer

Explanation of Solution

The following financial strategies should be adopted for sound financial planning:

Minimize your taxes:
One of the financial strategies is to reduce taxes through legal way. It means learning about tax system so that one can manage his/her portfolio in a way that he /she need not to pay high taxes.
Invest wisely:
It means that one should invest wisely while keeping in his minds his goals and be careful about the shady investment that are available outside in the world.
Save for retirement:
One may not think much about their retirement right now but it is essential to cover your retirement because nobody wants to leave their old age with no money in the hand. So, one must consider about their retirement during their financial planning.
Protect your asset:
A good financial plan is that which protect your current asset as well. So, one should take adequate insurance at low cost to protect their assets.
Aggregate wealth for special expenses:
A good financial planner is that who keeps in mind the special expense that if not planned successfully can erode their wealth completely. Special expenses are marriage expense and college fees, etc.
Plan for uncertainty:
It may sound funny that how one can plan for an event that he even does not know will exist but one should keep in mind the future uncertainties and plan some extra wealth for that uncertain event. Uncertain event can be accident of a person. Uncertain event can be an event which could reduce family income sharply and increase their expense sharply.

The mistakes one should avoid are:

The mistakes that person can make is that he/she does not consider about tax and end up paying more tax than required.
Spend more than what they need to end up having no money for their investments.
It may happen that whatever amount of insurance a person takes is not sufficient enough for that purpose.
Not thinking about the future contingencies.

Conclusion

One should keep in mind, things like future requirement, contingencies and obligation and other things while planning financially and avoid doing things like planning according to taxes, splurge and insufficient insurance and many more.

Answer 7

Chapter 1, Problem 1PA

Summary Introduction

To discuss:

Financial strategies one should develop and financial problems one must avoid.

Introduction:

Financial strategies refer to the way through which a family or a person achieves their future financial security. Financial security refers to the situation where a person has enough money to provide himself and his own family the basic necessities of life.

Answer 8

Expert Solution & Answer

Explanation of Solution

The following financial strategies should be adopted for sound financial planning:

Minimize your taxes:
One of the financial strategies is to reduce taxes through legal way. It means learning about tax system so that one can manage his/her portfolio in a way that he /she need not to pay high taxes.
Invest wisely:
It means that one should invest wisely while keeping in his minds his goals and be careful about the shady investment that are available outside in the world.
Save for retirement:
One may not think much about their retirement right now but it is essential to cover your retirement because nobody wants to leave their old age with no money in the hand. So, one must consider about their retirement during their financial planning.
Protect your asset:
A good financial plan is that which protect your current asset as well. So, one should take adequate insurance at low cost to protect their assets.
Aggregate wealth for special expenses:
A good financial planner is that who keeps in mind the special expense that if not planned successfully can erode their wealth completely. Special expenses are marriage expense and college fees, etc.
Plan for uncertainty:
It may sound funny that how one can plan for an event that he even does not know will exist but one should keep in mind the future uncertainties and plan some extra wealth for that uncertain event. Uncertain event can be accident of a person. Uncertain event can be an event which could reduce family income sharply and increase their expense sharply.

The mistakes one should avoid are:

The mistakes that person can make is that he/she does not consider about tax and end up paying more tax than required.
Spend more than what they need to end up having no money for their investments.
It may happen that whatever amount of insurance a person takes is not sufficient enough for that purpose.
Not thinking about the future contingencies.

Answer 9

Expert Solution & Answer

Answer 10

Expert Solution & Answer

Answer 11

Conclusion

One should keep in mind, things like future requirement, contingencies and obligation and other things while planning financially and avoid doing things like planning according to taxes, splurge and insufficient insurance and many more.

Answer 12

Ch. 1 - Prob. 1PA Ch. 1 - Prob. 2PA Ch. 1 - Prob. 3PA Ch. 1 - Prob. 4PA Ch. 1 - The goal of financing the cost of education is...Ch. 1 - Prob. 6PA Ch. 1 - Prob. 7PA Ch. 1 - Prob. 1DC1 Ch. 1 - Prob. 2DC1 Ch. 1 - Jeremiah, an accountant, and Bethany just returned...

Explanation of Solution

Want to see more full solutions like this?

Chapter 1 Solutions