Personal Financial Planning Process Flashcards
Once a sound financial plan is in place, there should be no need to ever change it.
False
One purpose of financial planning is to help you legally reduce the amount of taxes you have to pay on your earnings.
True
Financial planning is an ongoing process. As your financial situation and position in life change, the plan changes.
TRUE
A short-term goal might take from 1 to 10 years to accomplish.
FALSE
Estate-planning tools such as wills, living wills, health proxies, powers of attorney, and record-keeping should all be in place to help protect you, your assets, and your heirs.
TRUE
Most individuals will reach their financial goals without planning or budgeting.
FALSE
The Covid -19 pandemic that began in 2020 demonstrated that most Americans have sufficient emergency funds.
False
Salaries vary for individuals working in similar jobs for different companies, but one thing is clear: the more specialized skills and training a job requires, the higher the job tends to pay
TRUE
All else being equal, an increase in inflation will cause investors to require a higher rate of return on an asset.
TRUE
Diversification allows you to reduce risk.
TRUE