LSS 2103 Personal Finance

Case Study Resources

READ THE CASE CRITERIA!
HIGHLIGHTS:
40% of Course Mark
Due June 1
4 Page written report (Analysis and
Recommendations)
10 minute Power Point Presentation


Copyright 2014 Pearson Education, Inc. All rights reserved. 1-3
Realize that with all the case studies, you are trying
to develop a financial plan, defined as follows:
Personal financial plan: a plan that
specifies your financial goals and describes
the spending, financing, and investing
plans that are intended to achieve those
goals.
Suggestion: In your advice to your case
clients, focus on helping them achieve
financial goals!
READ THE CASE CRITERIA!
HIGHLIGHTS:

Your financial case analysis should
include the following items:
1. A discussion of the strengths and weaknesses
of the individual or family's financial situation.
Suggestion: Discuss their assets, liabilities, and
net worth as shown on the following slide.



Copyright 2014 Pearson Education, Inc. All rights reserved. 1-5
Analyze there assets, liabilities,
and net worth

Evaluate your current financial position
Assets: what you own
Liabilities: what you owe
Net worth: the value of what you own minus the value
of what you owe
Suggestion: List Assets, Liabilities, and
Net Worth as in the following slide under
the present situation column.
Copyright 2014 Pearson Education, Inc. All rights reserved. 2-6
Analyze the personal balance sheet
Suggestion: You could even analyze the personal
balance sheet that you prepared as in the
following slide:



Copyright 2014 Pearson Education, Inc. All rights reserved. 2-8
Personal Balance Sheet (contd)
Debt level is measured by debt-to-
asset ratio
Debt-to-Asset Ratio = Total liabilities/total assets
From personal balance sheet on previous slide
2,000/9,000 = 22.22%
Higher ratio = higher debt relative to assets
Suggestion: If their ratio is too high,
develop a strategy to lower it see
financial calculators later
READ THE CASE CRITERIA!
HIGHLIGHTS:

Your financial case analysis should
include the following items:
2. Correction of any misinformation that the
individual or family has about financial topics
Suggestion: Educate them about things like the
high cost of credit card debt, and the benefits of
compounded interest on savings.



READ THE CASE CRITERIA!
HIGHLIGHTS:

Your financial case analysis should
include the following items:
3. Comments about the individual or family's
cash flow.
Suggestion: Prepare a cash flow statement as in
the following slide.



Copyright 2014 Pearson Education, Inc. All rights reserved. 2-11
READ THE CASE CRITERIA!
HIGHLIGHTS:

Your financial case analysis should include
the following items:
4. Comments about emotional issues related to the
individual or family's financial situation

Suggestion: This is an easy one, just point out the issues
related to job stress and financial pressures that everyone
faces, and suggest some solutions.



READ THE CASE CRITERIA!
HIGHLIGHTS:

Your financial case analysis should
include the following items:
5. Calculations of the savings required to reach financial
goals

Suggestion: Use the savings goal calculator on the
following slide .



Use this calculator to help advise
how your case clients can save for a
future financial goal
Savings Goal Calculator
READ THE CASE CRITERIA!
HIGHLIGHTS:

Your financial case analysis should include
the following items:
6. Give 3 to 5 recommended action steps to improve
the individual or family's financial situation

Suggestion: Use the various calculators provided on the
following slides.



Use these calculators to help advise
how your case clients can save extra
money by avoiding impulse
purchases
Lunch Savings Calculator
Benefits of Spending Less Calculator

Use this calculator to help advise
how your case clients can save for
college
College Savings Plan Calculator
Use this calculator to help advise
how your case clients can save to
reach a financial goal in the future
for retirement or other needs.
Cool Million Calculator

Use this calculator to help achieve goal of
paying off credit card balance in a particular
period of time


www.federalreserve.gov/creditcardcalculator

Use this calculator to estimate the
time it will take to pay off credit
cards utilizing different monthly
payments.


www.consumercredit.com/debt-payoff-calc.htm


Use this calculator to help
compare the cost of leasing versus
purchasing a car.


autos.aol.com/calculators/car-lease-
calculator/
READ THE CASE CRITERIA!
HIGHLIGHTS:

Your financial case analysis should include the
following items:
7. Recommend financial products such as bank
accounts, insurance policies, and mutual
funds

Suggestion: Look up definitions for things like Mutual Funds
on Investopedia.com, and look at investment sites like
Moodys or Morningstar and suggest specific investments.



READ THE CASE CRITERIA!
HIGHLIGHTS:

Your financial case analysis should include
the following items:
8. Suggest available resources that can assist the
individual or family to improve their finances


Suggestion: Provide a suggested reading list on personal
finance. Google something like NY Times bestseller list
of personal finance books.



READ THE CASE CRITERIA!
HIGHLIGHTS:

Your financial case analysis should include
the following items:
9. Give any other information that you feel is
useful and relevant to the case


Suggestion: Try to notice issues in the case that relate to
prior concepts we have discussed in class, and look those
issues up in BBLearn Power Points.



READ THE CASE CRITERIA!
HIGHLIGHTS:

Your financial case analysis should include the
following items:
10. References for source materials used to analyse
the case (feel free to use your textbooks, class notes,
Web sites, financial publications, and other resources
to assist in your analysis).

Please provide references in your paper and power point
presentation.



BE CREATIVE
Please not that the Case Criteria States the
Following:
Feel free to add additional assumptions to the
case as long as they are realistic for the situation
and described in your report.
In other words, you could say after interviewing
the clients in this case, you discovered that
they have or are doing _____, and should do
_____.


BE CREATIVE
For Example:

You could say after interviewing these people,
you discovered they spend too much on
Starbucks or McDonalds, and use the calculators
here to show them how much they would save
in a year if they stopped going to fast food
places.
BE CREATIVE
For Example:

Using these calculators in your case paper and
presentation will help you with giving specific
advice and avoiding too much general advice.
You cant just say your case clients need to earn
more money and spend less money! Give
specific advice with actual numbers.
BE CREATIVE
For Example:

Using these calculators in your case paper and
presentation will help you with giving specific
advice and avoiding too much general advice.
You cant just say your case clients need to earn
more money and spend less money! Give
specific advice with actual numbers.