FP 101

Syllabus Axia College/College of Humanities FP/101 Version 4 Foundations of Personal Finance Copyright © 2011, 2010, 2009 by University of Phoenix. All rights reserved. Course Description This course provides an overview of the elements necessary for effective personal financial planning and the opportunity to apply the techniques and strategies essential to this understanding. Primary areas of study include creating and managing a personal budget, understanding and paying taxes, working with financial institutions, wise use of credit cards and consumer loans, financing automobiles and homes, and the use of insurance for protecting one’s family and property. Policies Faculty and students/learners will be held responsible for understanding and adhering to all policies contained within the following two documents: • University policies: You must be logged into the student website to view this document. • Instructor policies: This document is posted in the Course Materials forum. University policies are subject to change. Be sure to read the policies at the beginning of each class. Policies may be slightly different depending on the modality in which you attend class. If you have recently changed modalities, read the policies governing your current class modality. Course Materials Bajtelsmit, V. L. & Rastelli, L. G. (2008). Personal finance: Managing your money and building wealth. Hoboken, NJ: Wiley. All electronic materials are available on the student website. Week One: Personal Financial Planning Details Due Points Objectives 1.1 List the five steps in the personal financial planning process. 1.2 Summarize what influences personal financial planning. 1.3 Identify parts of a financial plan. Course Preparation Read the course description and objectives. Read the instructor’s biography and post your own. Reading Read Ch. 1 of Personal Finance. Reading Read Appendix A. Participation Participate in class discussion. Ongoing 2 Discussion Questions 1. Refer to Figure 1-1 of Personal Finance. List the five steps in the personal financial planning process. Share one or two questions you may ask yourself when you are in Step 1. 2. Setting goals is one of the five steps of the financial planning process. Refer to Section 1.2 of Personal Finance, which discusses the changing needs over the Life Cycle. Provide some examples of financial goals that may be important for a family. Select one goal that is important to you and briefly discuss how this goal will influence your future financial planning. 3. Refer to Section 1.3 of Personal Finance. Which part of the comprehensive financial plan do rent and food fall under? What about life insurance, long-term care insurance, and estate planning; which section of the comprehensive plan do these fall under? Ongoing 1 Nongraded Activities and Preparation Video Watch the video, Decision to Own a Home vs. Rent, located at the following link: https://ecampus.phoenix.edu/secure/aapd/materials/videos/FP101.html Individual Personal Financial Planning Worksheet Resource: Appendix B Complete the Personal Financial Planning Worksheet located in Appendix B. Be sure to answer all questions completely. Post your Personal Financial Planning Worksheet as a Microsoft® Word attachment. Day 7 5 Week Two: Money Management Details Due Points Objectives 2.1 Describe how to organize and prepare personal financial statements. 2.2 Identify cash management products and services. 2.3 Complete a personal cash flow statement. Reading Read Ch. 2 of Personal Finance. Reading Read Ch. 4 of Personal Finance. Participation Participate in class discussion. Ongoing 2 Discussion Questions 1. Refer to p. 87–93 of Personal Finance. Identify two cash management products and provide a short description of each. Do you have any experience with these products? 2. Review Section 4.4.1 of Personal Finance. What are some questions you should consider when opening a checking account? 4. Review Mary’s balance sheet. Do you think Mary is saving enough money for emergencies, college, or retirement? What Rule of Effective Cash Management should Mary use to improve this situation? Ongoing 1 Nongraded Activities and Preparation Home Budget Calculator Watch the tutorial, Home Budget Calculator, located at the following link: http://wps.pearsoncustom.com/wps/media/objects/7557/7738468/fin-calcs/HomeBudget.html Feedback Question: How are your organization skills working for you? What is working? What challenges remain? Individual Toolwire® Learnscape: Understanding Effective Money Management Resource: Toolwire® Learnscape: Understanding Effective Money Management Use the following instructions to complete the assignment: • Log in to your Student Web page. • Click on the link to the Toolwire® Learnscape: Understanding Effective Money Management. A new window will open containing a description of the Learnscape. • Complete the Learnscape Activities. Complete the Toolwire® Learnscape Assessment. Day 7 5 Week Three: Consumer Credit Details Due Points Objectives 3.1 List types of consumer credit. 3.2 Identify the five C’s of credit. Reading Read pp. 107–115 in Ch. 5 of Personal Finance. Participation Participate in class discussion. Ongoing 2 Discussion Questions 1. Review p. 113 of Personal Finance and list the five C’s of credit. Provide a brief description of each. 2. Edwina has been living with her parents since she graduated from college about 2 years ago. Because her parents only charge her a small amount for her room and board, she has managed to tuck away $5,000 in a savings account. Her car has died and her uncle has offered to sell his car for $4,500. o Edwina has never had a credit card or taken out a loan. Some of her friends are advising her to take out a loan. Edwina’s parents are against her borrowing money; they want her to use her savings to pay for the car. o What do you think Edwina should do? Should she get the loan or pay with her savings? Explain why you think your choice is the better one of the two. 3. Review Section 5.2 of Personal Finance. If you want to buy something, what are the three main ways to pay for the item? If you decide to use consumer credit to make your purchase, what are the two main types of credit available? Ongoing 1 Nongraded Activities and Preparation Five C’s Web Page Review the Five C’s web page located at the following link: http://www.loanuniverse.com/credit.html. Feedback Question: What are the biggest stressors about being an Axia student? Individual The Five C’s Worksheet Resource: Appendix C Complete the Five C’s Worksheet located in Appendix C. Identify which of the five C’s corresponds to each description in the table. Post your Five C’s Worksheet as a Microsoft® Word attachment. Day 7 8 Week Four: Credit Protection and Repair Details Due Points Objectives 4.1 Recognize the advantages and disadvantages of credit cards. 4.2 Summarize how to protect and correct credit. Reading Read pp. 115–133 in Ch. 5 of Personal Finance. Reading Read this week’s Electronic Reserve Readings. Participation Participate in class discussion. Ongoing 2 Discussion Questions 1. Go to http://www.bankrate.com/calculators/managing-debt/minimum-payment-calculator.aspx. o Type in $5,000 for “What is your credit card balance?” o Type in $150 for “What fixed payment could you make each month?” o Do you think it is better to pay only the minimum payment or pay the higher monthly amount? Explain why. 2. Review How to Establish, Use, and Protect Your Credit located under your Week Four Electronic Reserve Readings. o What is one way to establish your credit and one way to protect your credit? What are some things you can do to improve poor credit? 3. What are some advantages and disadvantages of using credit cards? Have you ever had a credit card? If so, please share some of your experiences with them. 5. Log onto Annual Credit Report www.annualcreditreport.com. What are the names of the three credit reporting agencies? Using information from the Frequently Asked Questions section, briefly explain what a credit score is. Ongoing 1 Nongraded Activities and Preparation Annual Credit Report Website Resource: Annual Credit Report website: www.annualcreditreport.com Explore the Frequently Asked Questions section to learn about credit reporting, credit improvement, information correction, identity theft, and other topics Feedback Question: Which university resources have you been using to help you be a more effective student? How might those resources help you be more effective in this course? Individual Midterm Exam Complete the Midterm Exam located under Assessments on your student website. You may complete the exam only once. Your instructor will receive a separate copy of your quiz results in your Individual forum. • If you experience technical difficulty with the exam, please call Technical Support. • Technical Support can be reached at 1-866-334-7332 and is available 24 hours a day, 7 days a week. Day 7 10 Week Five: Avoiding and Managing Debt Details Due Points Objectives 5.1 List good practices for managing debt. 5.2 Recognize signs of credit trouble. 5.3 Identify parts of a credit report. 5.4 Recognize student loan options and implications for the future. Reading Read Ch. 6 of Personal Finance. Participation Participate in class discussion. Ongoing 2 Discussion Questions 1. Go to http://www.annualcreditreport.com to get a free credit report from Experian. Note. Do not choose any of the options that require payment. Review all of the brown tabs at the top of the page. After retrieving your report and reviewing these items, answer the following question: Discuss what you learned about credit in general, and what type of information is in your credit report. Be careful not to divulge confidential information about your credit; keep the discussion to the general type of information found on a credit report. 2. Refer to Section 6.4 of Personal Finance. Discuss some positive steps you can take to manage debt. 3. Choose one of the signs of credit trouble listed on p. 145 of Personal Finance. Explain how someone can try to improve this situation. Ongoing 1 Nongraded Activities and Preparation Fair Credit Resource: The Fair Credit Report Agency and Avoiding Scams sections located at the following link: http://www.ftc.gov/bcp/edu/pubs/consumer/credit/cre03.shtm. Feedback Question: How are your stress management strategies holding up for you? Is the stress you are experiencing what you expected it to be? What did you not expect? How are you handling those stressors? What stress management techniques have you found to be particularly useful for yourself? Individual Toolwire® Learnscape: Exploring Strategies for Avoiding and Managing Debt Resource: Toolwire® Learnscape: Exploring Strategies for Avoiding and Managing Debt Use the following instructions to complete the assignment: • Log in to your student web page. • Click on the link to the Toolwire® Learnscape: Exploring Strategies for Avoiding and Managing Debt. A new window will open containing a description of the Learnscape. • Complete the Learnscape Activities. Complete the Toolwire® Learnscape Assessment. Day 7 5 Week Six: Major Financial Assets Details Due Points Objectives 6.1 Explain interest rates. 6.2 Outline the decision process for buying a car or house. 6.3 Summarize the steps in buying a home. Reading Read Ch. 7 of Personal Finance. Participation Participate in class discussion. Ongoing 2 Discussion Questions 1. Refer to Figure 7-1 of Personal Finance. Why is it important to go through these steps when you are planning on making a large purchase? 2. Refer back to Section 6.1.1 of Personal Finance. Discuss one of the risks of a variable rate loan. 3. Review Decision to Own a Home vs. Rent. Discuss the advantages and disadvantages of renting a home vs. buying. Ongoing 1 Nongraded Activities and Preparation Purchase Versus Lease Decision Resource: Purchase versus Lease Decision located at the following link: http://wps.prenhall.com/wps/media/objects/6969/7137133/fin-calcs/BuyvsLease.html Feedback Question: Have you been using the Center for Writing Excellence? How as that worked for you? How might that help you in this course? What challenges have you found when using the Center for Writing Excellence? Individual Toolwire® Learnscape: Considerations Surrounding Major Financial Assets Resource: Toolwire® Learnscape: Considerations Surrounding Major Financial Assets Use the following instructions to complete the assignment: • Log in to your student web page. • Click on the link to the Toolwire® Learnscape: Considerations Surrounding Major Financial Assets. • A new window will open containing a description of the Learnscape. • Complete the Learnscape Activities. Complete the Toolwire® Learnscape Assessment. Day 7 5 Week Seven: Insurance Details Due Points Objectives 7.1 Summarize the functions of insurance. 7.2 List characteristics of auto, home, health, disability, and life insurance. 7.3 Describe the importance of wills. Reading Read Ch. 8 of Personal Finance. Reading Read pp.225–240 in Ch. 9 of Personal Finance. Reading Read pp.248–260 in Ch. 10 of Personal Finance. Reading Read pp. 408–417 in Ch. 15 of Personal Finance. Participation Participate in class discussion. Ongoing 2 Discussion Questions 1. What does it mean to have insurance? Choose two types of insurance (auto, home, health, disability, or life insurance) and identify one characteristic of each. 2. Angie is considering the options for deductibles on her auto insurance. She can save $150 a year by switching from a $500 to a $1,000 deductible. What is a deductible? What does this mean if Angie has a car accident? 3. If you own your car or house and are no longer making payments, should you still have insurance on them? Explain why or why not. Ongoing 1 Nongraded Activities and Preparation Reasons for Having a Will Resource: Reasons for Having a Will located at the following link: https://ecampus.phoenix.edu/secure/aapd/materials/videos/FP101.html Feedback Question: What kinds of questions do you have remaining about plagiarism and how to avoid it? Individual Insurance Matrix Resource: Appendix E Complete the Insurance Matrix in Appendix E. Post the completed Insurance Matrix as a Microsoft® Word attachment. Day 7 10 Week Eight: Tax Management Details Due Points Objectives 8.1 Explain taxable income and taxes owed. 8.2 Summarize ways to save money on federal taxes. 8.3 List steps to file a federal tax return. Reading Read Ch. 3 of Personal Finance. Participation Participate in class discussion. Ongoing 2 Discussion Questions 1. Refer to Section 3.2 of Personal Finance. What is taxable income and how do you know how much taxes are owed? 2. There are a number of ways to fill out tax return. If you prepare your own tax returns, you can use a software package to fill out the proper forms. Review Personal Income Taxes located at the following link: https://ecampus.phoenix.edu/secure/aapd/materials/videos/FP101.html. List one benefit and one disadvantage of filing your taxes electronically. 3. Some individuals prefer to have their employers withhold more money than they will owe so they can get big refund checks in April or May. Others prefer to minimize withholdings, so they can either spend the money throughout the year, or put it into a retirement or other savings account. Which strategy do you think is better? Explain why. Ongoing 1 Nongraded Activities and Preparation Focus on Ethics: Reducing Your Taxes Resource: Focus on Ethics: Reducing Your Taxes located at the following link: https://ecampus.phoenix.edu/secure/aapd/materials/videos/FP101.html. Feedback Question: How does your understanding of academic credibility apply to your work in this course? Individual Toolwire® Learnscape: Effective Tax Management Resource: Toolwire® Learnscape: Effective Tax Management Use the following instructions to complete the assignment: • Log in to your student web page. • Click on the link to the Toolwire® Learnscape: Effective Tax Management. A new window will open containing a description of the Learnscape. • Complete the Learnscape Activities. Complete the Toolwire® Learnscape Assessment. Day 7 5 Week Nine: Investment and Long-Term Planning Details Due Points Objectives 9.1 Summarize the investment planning process. 9.2 Explain retirement income needs. 9.3 List sources of retirement income. Reading Read Ch. 11 of Personal Finance. Reading Read Ch. 14 of Personal Finance. Participation Participate in class discussion. Ongoing 2 Discussion Questions 1. What things do you take into consideration when beginning to plan for investments? Why is it important to understand your long term goals before you begin investing? 2. At what age do you hope to retire? How do you plan to incorporate your retirement in your personal financial plan? 4. Refer to Section 11.1.3 in Personal Finance. List two ways to begin putting aside money for investments. You can often save money by making small changes. Share one tip you think may help save some money in the long-run. Ongoing 1 Nongraded Activities and Preparation How Retirement Planning Fits Within Your Financial Plan Resource: How Retirement Planning Fits Within Your Financial Plan video located at the following link: https://ecampus.phoenix.edu/secure/aapd/materials/videos/FP101.html Feedback Question: What are you doing to ensure that you remain an ethical and honest student? Individual Final Exam Complete the Final Exam located under Assessments on your student website. You may complete the exam only once. Your instructor will receive a separate copy of your quiz results in your Individual forum. • If you experience technical difficulty with the exam, please call Technical Support. • Technical Support can be reached at 1-866-334-7332 and is available 24 hours a day, 7 days a week Day 7 20 Optional Discussion Questions Week One Discussion Questions • Refer to Figure 1-1 of Personal Finance. List the five steps in the personal financial planning process. Share one or two questions you may ask yourself when you are in Step 1. • Setting goals is one of the five steps of the financial planning process. Refer to Section 1.2 of Personal Finance which discusses the changing needs over the Life Cycle. Provide some examples of financial goals that may be important for a family. Select one goal that is important to you and briefly discuss how this goal will influence your future financial planning. • Refer to Section 1.3 of Personal Finance. Which part of the comprehensive financial plan do rent and food fall under? What about life insurance, long-term care insurance, and estate planning; which section of the comprehensive plan do these fall under? • Page 8 of Personal Finance discusses how education plays a critical role in financial success. List at least two financial benefits of being college educated? How might a college education affect your long-term financial plan? • Watch the video, Decision to Own a Home vs. Rent, located at the following link: https://ecampus.phoenix.edu/secure/aapd/materials/videos/FP101.html Tom and Tammy Jones have been renting a house for 5 years. They have been saving money to buy a house for their family and have over half of the down payment set aside. The house the Jones’ have been living in has been sold and they are trying to figure out what to do. They are considering the following options: o Move in with Tom’s parents, who live nearby. With the low room and board they will pay, they should be able to buy a house within a year. o Rent a house. Rental prices have gone up, so if they do this, they will not be able to add to their down payment account. o Move to a less expensive town, which will add 45 minutes each way to Tom’s commute. They will be able to add to their down payment account and should be able to buy a house within 3 years. What should the Jones family do? Discuss your reasons for making the choice you did. Week Two Discussion Questions • Refer to p. 87–93 of Personal Finance. Identify two cash management products and provide a short description of each. Do you have any experience with these products? • Review Section 4.4.1 of Personal Finance. What are some questions you should consider when opening a checking account? • What are some ways to save and store your personal financial information? • Review Mary’s balance sheet. Do you think Mary is saving enough money for emergencies, college, or retirement? What Rule of Effective Cash Management should Mary use to improve this situation? • Review the Home Budget Calculator located at the following link: http://wps.pearsoncustom.com/wps/media/objects/7557/7738468/fin-calcs/HomeBudget.html. Input the requested information from your paycheck and on the expenses page. Did you find this calculating tool useful? Explain why or why not. Week Three Discussion Questions • Review p. 113 of Personal Finance and list the five C’s of credit. Provide a brief description of each. • Edwina has been living with her parents since she graduated from college about 2 years ago. Because her parents only charge her a small amount for her room and board, she has managed to tuck away $5,000 in a savings account. Her car has died and her uncle has offered to sell his car for $4,500. o Edwina has never had a credit card or taken out a loan. Some of her friends are advising her to take out a loan. Edwina’s parents are against her borrowing money; they want her to use her savings to pay for the car. o What do you think Edwina should do? Should she get the loan or pay with her savings? Explain why you think your choice is the better one of the two. • Review Section 5.2 of Personal Finance. If you want to buy something, what are the three main ways to pay for the item? If you decide to use consumer credit to make your purchase, what are the two main types of credit available? • Discuss one advantage and one disadvantage of consumer credit. • After reviewing The Five C’s located in your course materials, answer the following questions: o Which of the five C’s does employment and education history fall under? o What is collateral? Why is collateral required for some people and for some types of loans? Week Four Discussion Questions • Go to http://www.bankrate.com/calculators/managing-debt/minimum-payment-calculator.aspx. o Type in $5,000 for “What is your credit card balance?” o Type in $150 for “What fixed payment could you make each month?” o Do you think it is better to pay only the minimum payment or pay the higher monthly amount? Explain why. • Review How to Establish, Use, and Protect Your Credit located under your Week Four Electronic Reserve Readings. o What is one way to establish your credit and one way to protect your credit? What are some things you can do to improve poor credit? • What are some advantages and disadvantages of using credit cards? Have you ever had a credit card? If so, please share some of your experiences with them. • Visit the Federal Trade Commission at http://www.ftc.gov/bcp/edu/pubs/consumer/credit/cre03.shtm. Using Section 2 of this page, which explains what you can do to legally improve your credit report, discuss what steps you can take if you find incorrect information on your credit report. • Log onto Annual Credit Report www.annualcreditreport.com. What are the names of the three credit reporting agencies? Using information from the Frequently Asked Questions section, briefly explain what a credit score is. Week Five Discussion Questions • Go to http://www.annualcreditreport.com to get a free credit report from Experian. Note. Do not choose any of the options that require payment. Review all of the brown tabs at the top of the page. After retrieving your report and reviewing these items, answer the following question: Discuss what you learned about credit in general, and what type of information is in your credit report. Be careful not to divulge confidential information about your credit; keep the discussion to the general type of information found on a credit report. • Refer to Section 6.4 of Personal Finance. Discuss some positive steps you can take to manage debt. • Choose one of the signs of credit trouble listed on p. 145 of Personal Finance. Explain how someone can try to improve this situation. • Review the Student Loans video, located at the following link: https://ecampus.phoenix.edu/secure/aapd/materials/videos/FP101.html . o What are some benefits of using student loans? o When do you have to begin paying back these loans? o What does it mean if your loans go into default? • Log onto the Federal Trade Commission website: http://www.ftc.gov/bcp/edu/pubs/consumer/credit/cre03.shtm. Under Section 3, which offers tips on dealing with debt, review Avoiding Scams. Answer the following question: o If a person is trying to get out of debt and looking for help, what are some of the actions or organizations to avoid? Week Six Discussion Questions • Refer to Figure 7-1 of Personal Finance. Why is it important to go through these steps when you are planning on making a large purchase? • Refer back to Section 6.1.1 of Personal Finance. Discuss one of the risks of a variable rate loan. • Review Decision to Own a Home vs. Rent. Discuss the advantages and disadvantages of renting a home vs. buying. • Refer to Section 7.4, 7.5, and 7.6 of Personal Finance. List three steps in buying a home. What are some important points to consider in your purchase? • Review Purchase vs. Lease Decision. Imagine you need a new car. Input the amount you can spend in the Buy vs. Lease Calculator. Review the results and discuss the advantages and disadvantages of buying vs. leasing a vehicle. Week Seven Discussion Questions • What does it mean to have insurance? Choose two types of insurance (auto, home, health, disability, or life insurance) and identify one characteristic of each. • Angie is considering the options for deductibles on her auto insurance. She can save $150 a year by switching from a $500 to a $1,000 deductible. What is a deductible? What does this mean if Angie has a car accident? • If you own your car or house and are no longer making payments, should you still have insurance on them? Explain why or why not. • Geraldo works full-time to take care of his family. His wife, Marina, stays home to take care of their two young children. What kind of insurance coverage should Geraldo and Marina have for their family? Explain why. • Review the Reasons for Having a Will video, located at the following link: https://ecampus.phoenix.edu/secure/aapd/materials/videos/FP101.html . o Acela’s aging parents own a house and a car. Acela is currently living in the house with her parents. Her brother and sister are married and live elsewhere. Why is it important for Acela’s parents to have wills? What are some possible consequences of not having wills? Week Eight Discussion Questions • Refer to Section 3.2 of Personal Finance. What is taxable income and how do you know how much taxes are owed? • There are a number of ways to fill out tax return. If you prepare your own tax returns, you can use a software package to fill out the proper forms. Review Personal Income Taxes located at the following link: https://ecampus.phoenix.edu/secure/aapd/materials/videos/FP101.html o List one benefit and one disadvantage of filing your taxes electronically. • Some individuals prefer to have their employers withhold more money than they will owe so they can get big refund checks in April or May. Others prefer to minimize withholdings, so they can either spend the money throughout the year, or put it into a retirement or other savings account. Which strategy do you think is better? Explain why. • Review Section 3.3 of Personal Finance. Do you think it is better to prepare your taxes yourself or to have them prepared by a professional? Explain why. • Review Focus on Ethics: Reducing Your Taxes located at the following link: https://ecampus.phoenix.edu/secure/aapd/materials/videos/FP101.html . Why is it important to keep records and receipts for expenses you plan on deducting on your taxes? Week Nine Discussion Questions • What things do you take into consideration when beginning to plan for investments? Why is it important to understand your long term goals before you begin investing? • At what age do you hope to retire? How do you plan to incorporate your retirement in your personal financial plan? • Refer to pg. 391 in Personal Finance and review Concern about Retirement Benefits in the Future located at the following link: https://ecampus.phoenix.edu/secure/aapd/materials/videos/FP101.html . o What is Social Security? Discuss how it fits into your retirement plan. There are concerns that Social Security may have trouble paying full benefits in the future. Why does this matter to you now? • Refer to Section 11.1.3 in Personal Finance. List two ways to begin putting aside money for investments. You can often save money by making small changes. Share one tip you think may help save some money in the long-run. • Review How Retirement Planning Fits within Your Financial Plan located at the following link: https://ecampus.phoenix.edu/secure/aapd/materials/videos/FP101.html. o Discuss the type of financial needs you will have at retirement age. How important is retirement planning to you now? How important do you think it will be in 10 years? Copyright University of Phoenix® is a registered trademark of Apollo Group, Inc. in the United States and/or other countries. Microsoft®, Windows®, and Windows NT® are registered trademarks of Microsoft Corporation in the United States and/or other countries. All other company and product names are trademarks or registered trademarks of their respective companies. Use of these marks is not intended to imply endorsement, sponsorship, or affiliation. Edited in accordance with University of Phoenix® editorial standards and practices.