Unit 1 Study Guide - Belle Vernon Area School District by liamei12345

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									PERSONAL FINANCE                                      Name________________________
UNIT 1 STUDY GUIDE

Matching: Place the letter of the correct definition in the space provided.

______1. Financial planning                           A. Measures the money you receive and the
                                                      money you spend.
______2. Needs                                        B. Beliefs and practices in your life that are very
                                                      important to you.
______3. Wants                                        C. Goals that you want to achieve within the
                                                      next three months.
______4. Values                                       D. Something you aim for.
                                                      E. Process of setting goals, developing a plan to
______5. Short-term goal                              achieve them, and putting the plan into action.
                                                      F. Things that make life more interesting and
______6. Intermediate goal                            fun, but you could live without them if you had
                                                      to.
______7. Long-term goal                               G. Goals set for three months to a year.
                                                      H. The willingness to give up something you
______8. Delayed gratification                        want now to get something even better in the
                                                      future.
______9. Cash flow                                    I. Often a major decision leads to several
                                                      smaller ones, sometimes called ????
______10. Opportunity cost                            J. Goals that will taken you more than a year to
                                                      achieve.
______11. Satellite decisions                         K. The trade-off of choosing one goal over
                                                      another.
______12. Goal                                        L. The very basic things we must have to
                                                      survive.


When establishing goals, they should be SMART goals. What do the letters in SMART stand for?

S______________________

M_____________________

A______________________

R______________________

T____________________________
What are the five steps of the Financial Planning Process?

1.

2.

3.

4.

5.



Below are two goals. Assess each one to see which SMART goal components are missing. Rewrite the
goal as a SMART goal.

1. Save $100 for a trip to Dallas during spring break.

        Missing component(s):___________________________________________________________

        Rewrite goal as SMART goal_______________________________________________________

        ______________________________________________________________________________

2. Save money for a gift.

        Missing component(s):___________________________________________________________

        Rewrite goal as SMART goal_______________________________________________________

        ______________________________________________________________________________



John plans to save $2,400 for a down payment on a car in two years. How much will he have to save
each month to achieve his goal?__________________



In 7 months, Kim’s parents will need to make the final payment on a trip to Mexico. Half of the total
cost was paid when the vacation was booked. The total cost is $5,600. How much will Kim’s parents
have to save each month to achieve their goal?_________________

								
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