The main objective of any personal financial plan is to maintain financial security by ensuring financial inflows are able to meet expected current and/or expected outflows. Personal financial plans are also essential in meeting financial obligations such as capital, annuities or savings. In addition, any personal financial plan is aimed at effectively managing risk through diversification of income or investment capital (Gitman & Joehnk, 2008). Personal financial plans also facilitate easier recording and storage of financial information thereby providing pragmatic references during the decision making process (Gitman & Joehnk, 2008).
Personal income is an individual's total earnings which can be acquired through four main sources. The first source of personal income is through wages and salaries which is the total compensation that is paid to each employee by an enterprise for labor and/or completed tasks in deference to the labor agreement or employment contract (Garman & Forgue, 2009). Any personal business activity that results in profits is also a source of personal income, as well as earnings from investments. Social aid is also a source of income where government payments in form of welfare are granted to individual below a specific income level (Garman & Forgue, 2009).
[...] Personal finance. New Jersey: Cengage Learning. Gitman, J., L. & Joehnk, M., D. (2008). Personal financial planning. New Jersey: Cengage Learning. [...]
[...] Personal financial choices have a significant impact on income. The choice of financial spending determines where one is in a position to save or is in debt. An individual spending more than his income will normally result in financial crises that can lead to superfluous debt (Gitman & Joehnk, 2008). The choice to invest in assets rather than consumables will increase income since assets including stocks and bonds will yield income in future while items such as TV or furniture will not (Gitman & Joehnk, 2008). [...]
[...] Personal financial plans are also essential in meeting financial obligations such as capital, annuities or savings. In addition, any personal financial plan is aimed at effectively managing risk through diversification of income or investment capital (Gitman & Joehnk, 2008). Personal financial plans also facilitate easier recording and storage of financial information thereby providing pragmatic references during the decision making process (Gitman & Joehnk, 2008). Personal Finance Personal income is an individual's total earnings which can be acquired through four main sources. [...]
[...] Conclusion To check on the consumer credit status, one needs to request for a consumer credit report from a credit reporting bureau and ensure protection of such information by ascertaining from the bureau that a duplicate of such data does not exist (Garman & Forgue, 2009). The interest rate is the primary method to evaluate checking and savings accounts where deposits are made into accounts with higher interest rates. Analyzing investment choices requires one to determine the present value and internal rate of return (IRR) of each choice, whereby the best choice is the one with the highest PV and IRR (Garman & Forgue, 2009). References Garman, E., T. & Forgue, E., (2009). [...]
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