INTRODUCTION TO

FINANCIAL PLANNING &

MANAGEMENT

LEARNING OUTCOMES:

The student understand why financial planning

and management is important.

The student understands economy and events in
life that affect personal financial success.
The student realize SMART goal setting.
*** SMART FROM THE START***

FINANCIAL MANAGEMENT
Is the process of allocating financial resource to maximize the
profitability and wealth of the company.
Is a decision making process concerned with planning, acquiring &
utilizing funds in a manner that achieves the firms desired goals.

FINANCE
The body of facts, principles, & theories relating to raising and using
money by individuals, businesses, and governments.

How financial planning and

management will contribute to future
success?
Being financially competent includes three (3) different aspects

1. Financial
knowledge and
understanding
2. Financial skills
and competencies

3. Financial
responsibility

- understanding the nature of money and

insight into its functions and uses.
- learning about Personal Finance, this is
applying knowledge and understanding of
financial matters across a range of contexts.
- it means to understand how financial
decisions can impact the person making a final
decision, their family and community.

I. Financial knowledge and

understanding

Without it, modern economies could not function

Money is the lifeblood of a business
money can be anything that can serve as a :
store of value - which means people can save it and use it
later smoothing their purchases over time
A measure of value expresses worth
medium of exchange payment for goods and services

Perhaps the easiest way to think about the role of

money is to consider what would change if we did
not have it.

I. Financial knowledge and

understanding

Is field closely related to accounting that deals with allocation

of assets and liabilities over time under conditions of certainty
and uncertainty.
The science of money management
Finance aims to price assets based on their risk level and
their expected rate of return.
Finance can be broken in 3 different sub-categories:
Public

Finance - finance used by governments

Corporate Finance finance used by businesses

Personal Finance finance used by individuals

II. Financial skills and competencies

1. Financial Position - understanding the personal resources

available
2. Adequate Position analysis of how to protect household from
unforeseen risks
3. Tax Planning income tax matters and paying taxes
4. Investment and accumulation goals planning how to
accumulate enough money for large purchases & life events.
5. Retirement planning understanding how much it costs to live at
retirement
6. Estate Planning involves planning for the disposition of ones
assets after death

III. Financial responsibility

Goal something you aim for
(something you want to achieve)

Needs the very basic things we

must have to survive.

A good rule of thumb to follow

when setting goals is following
the SMART goal setting
process.

Wants the things that make life

more interesting and fun, but you
could live without them if you had
to.

 There are crisis events to consider that can affect your

personal finances like:
- great depression
- taxes
- unemployment trends
- retirement funding
- stock market changes
- inflation/price hike

References:
www.ffa.org. Financial management
money.cnn.com. Money Matters
Financial Management Principles & Applications
2012-2013 Edition/ By Ma. Elenita Balatbat Cabrera
Fundamentals of Financial Management
2012/ By Samuel M. Salvador and company
Economics
3rd Edition/ By Feliciano R. Fajardo
Economics Principles & Practices
By Gary E. Cayton & James E. Brown