Personal Financial Planning
Wealth Management
Tutorial 1
Review Question 1
Why is financial planning, or just plain money
management, a challenge to many people?
Review Question 2
What three characteristics are required to define financial
goals? Once identified, why is it important to rank goals?
Review Question 3
Explain the time horizon for short-term, intermediate-
term, and long-term goals. Give an example of each.
This Photo by Unknown Author is licensed under CC BY
Review Question 4
List and characterize the stages of the financial life cycle.
What three financial concerns are addressed across all
three stages?
Review Question 5
Define career planning. How is it related to financial
planning?
Review Question 6
List three reasons why college students should have a
résumé already prepared well before graduation
Review Question 7
What do you think will be the five most important strategies
for success in your career field?
Review Question 8
Explain why it is important to review past economic
downturns when studying personal finance.
Review Question 9
What are the two reasons investors demand compensation
when saving money or making an investment?
Explain how Principles 3 and 8 affect the choice to delay
consumption. Why might investors who ignore these
principles lose money?
Discussion Case 1
Jimmy, an accountant and Bethany just returned from their
honeymoon in the Bahamas. They celebrated their marriage and
completion of Bethany’s MBA program. They have been
encouraged by their parents to establish some personal and
financial goals for their future. However, they do not know how to
set or achieve these goals. They know that they would like to
own their own home and have children, but those are the only
goals they have considered. Jimmy knows of a financial advisor
who might be able to help with their predicament, but they don’t
think they can afford professional help.
Discussion Case 1 – Question 1
If you were serving as the couple’s financial advisor, how
would you explain the five steps in the financial planning
process and their importance to future financial success?
Discussion Case 1 – Question 2
What financial goals (short term, intermediate and long term)
would you determine to be the most important or least
important to Jimmy and Bethany considering their current life
cycle stage?
Discussion Case 1 – Question 3
What four concerns should guide the development of their
financial plan?
How do you relate these to Principles 4, 5 and 7?
Discussion Question 2
Discuss some factors to consider when selecting a financial advisor in Malaysia.
Possess relevant licenses
Capital Market Service Licensing Representative (SC)
Corporate Unit Trust Advisor (SC)
Financial Adviser Representative License (Bank Negara)
Qualification
Certified Financial Planner (CFP)
Registered Financial Planner (RFP) – Malaysian Financial Planning Council (MFPC)
Trustworthiness and experience
Need to be able to give good comprehensive advice according to the risk profile of the
client for good and bad times
Do proper background check and get referrals for good past service and success of the
financial planner
Financial planners must adhere to a proper code of ethics.
You will be disclosing personal data to the financial advisor Integrity is of utmost
importance.
Additional Question 1 (cont/…)
Discuss some factors to consider when selecting a financial advisor in Malaysia
Availability and Follow-up
Availability to review financial plans and asset portfolios on a regular basis
and able to answer any queries
Look for a planner who is in for the long haul and not just disappear after
constructing a financial plan for you.
Written agreement
Draw out the planner’s job scope and objectives in writing and in detail to
avoid future disputes.
Consider how the financial planner is remunerated
Commissions based – Conflict of interest may arise – you may be steered
towards products that yield the most commission to the financial planner.
Charge a one-off professional fee, retainer
Adapted fromfree
Source : Provide advice
Koh and – May
Fong (2013) lack https://www.imoney.my/articles/getting-financial-planner-malaysia
and iMoney objectivity and commitment
