ADM 3445 (FR01B)
Personal Financial Planning
Instructor: E. OtuteyeTerm: Winter 2012
Office hours: Th, F 2:00 – 3:00; by appointment; also, usually available immediately after class. COURSE OBJECTIVE AND DESCRIPTION:
The objective of this course is to introduce students to
1. the fundamental principles of financial decision-making; and 2. how these principles are applied to personal financial planning. Students will learn the concepts and methods necessary in developing personal financial plans as well as the financial planning process applied in professional practice. Topics to be covered include the fundamental principles of finance, financial goal setting, budgeting, tax planning, cash management, personal credit, investment planning, insurance planning, retirement and estate planning. There is about equal emphasis on the analytical principles underlying Personal Financial Planning as on the application of those principles. Thus an important component of this course is learning how to prepare a comprehensive financial plan. At the end of the course it is expected that students will acquire the necessary concepts and skills to be able to optimize their lifetime income and expenditure flows and to give sound personal financial planning advice based on well founded principles. Specifically, you should be able to: • understand a set of basic principles of finance that have relevance for financial planning; • develop the ability to use the concept of time value of money to make intertemporal comparison of cash flows and to make financial decisions based on that; • clearly assess your financial situation, prepare relevant financial statements including a budget and set meaningful financial goals; • know how to manage your credit, use the financial system to tap into credit sources for housing and other major expenditures, avoid credit traps, learn how to payoff your debts the fastest possible way; • understand your insurance needs and manage your personal risks with the appropriate choice of insurance and other mechanisms; • understand how financial markets and financial securities work and be able to make the right selection of stocks, bonds, or mutual funds that are appropriate for your situation, and know how to manage and increase your wealth using those financial instruments; • design proper retirement and estate plans so that you can have the post-retirement lifestyle that you want and to have your estate administered according to your preferences. TEXTBOOK:
Personal Finance, 4th Canadian Edition, Kapoor, Dlabay, Hughes, and Ahmad, McGraw-Hill Ryerson Ltd., 2009. http://www.mcgrawhill.ca/olc/kapoor Books for Book Review (Assignment 4):
1. The Wealthy Barber Returns by David Chilton, (David Barr Chilton, 2011).
2. Millionaire Teacher: The Nine Rules of Wealth You Should Have Learned in School by Andrew Hallam (Wiley, 2011).
3. The Little Book of Common Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns by John Bogle (Wiley, 2007).
You are also advised to read relevant material available online (Yahoo, MSN Money, etc.) or newspapers and magazines such as The Globe and Mail, Canadian...