Topic 1 Flashcards
How much debt was there in the UK in 2008?
1400bn
Is debt on the rise, doing down or at a standstill?
Going up
How many people were unemployed in january of 2009?
1.62m
In unemployed rising, decreasing or at a stand still?
Was rising in the mid 10s but is now declining
What is sustainable personal finance?
To maintain a balance between personal income and expenditure.
What should people do to maintain personal finance?
- Be aware of how much they are spending
- Use budgets
- Contingency plan
- Regularly monitor financial plans
- Only borrow amounts that they can pay back
What are the features of a dynamic plan?
- Balanced between time periods
- Fluid
- Informed
- Realistic
- Able to adapt to changing products and services.
What are the favourable events that a contingency plan can be used for?
Getting a job
Salary increase
Promotion
Winning the lottery
Paying of a loan
What are the unfavourable events that a contingency plan can be used for?
Losing a job
Increase in tax
Becoming ill and having to stop work
What are pensions and what are the different types?
A long-term form of investment that has tax benefits
state pension
occupational
personal pension plan
stakeholder pension ( cheapest)
NEST
How many properties were repossessed in 2009?
49000
What are the features of a dynamic plan?
Balanced between time periods
Informed
Able to adapt to changing products and services
Fluid
Realistic
What’s the first step in making a financial plan?
To make a list of all of the goods and services on which someone is likely to spend money over a given time frame and how much they will cost.
What are your spending priorities
1.Pay all mandatory bills.
2. Meet basic needs.
3. Pay essential bills.
4. Divide any surplus between spending and saving.
How does cash flow modelling software programs support with financial planning?
They allow individuals to predict the medium, long term effects that different decisions and events may have on their income ( What if scenarios ). This allows individuals to change their spending and saving to ensure that they can pay their expenditure.
What is a contingency plan?
A plan for unexpected events.
What can holders of current accounts use to make payments?
Cheques
Direct debit
Telephone marketing
Mobile banking
Standing order
Debit cards
Internet banking
What are the main products that allow people to borrow money from financial institutions?
Overdraft
Personal loans
Credit cards
Store cards
Hire purchase or retail credit
Mortgages
What is a payday loan?
A type of loan that ios instantly available online or from a high strreet loan shop
