part i introduction to financial planning1.5 demographic shifts 231 2. what is financial planning?...

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Foreword I-5

PART I

INTRODUCTION TO FINANCIAL PLANNING

CHAPTER ONE

BASICS OF INDIAN FINANCIALMARKETS

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About this topic 3

Topic objectives 3

1. Basic Concepts 4

1.1 Money 4

1.2 Financial Assets 4

1.3 Securities 4

1.4 Debt securities 5

1.5 Equity 6

1.6 Risk 7

1.7 Primary and secondary markets 7

2. The Financial system 8

2.1 Economy and financial system 8

2.2 Functions of the financial system 8

3. Types of Financial Markets and Instruments 9

3.1 The Equity market 9

3.2 The Debt market 10

3.3 The Foreign exchange market 11

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Features of Securities and Financial Markets 11

4.1 Primary and secondary markets 11

4.2 What makes a market tick? 12

4.3 How securities are bought and sold? 12

4.4 Investing in securities and financial markets 13

4.5 Impact of Globalisation of financial markets 14

5. The flow of funds 15

5.1 Intermediation 16

5.2 Disintermediation 16

REVIEW 17

QUESTIONS 17

ANSWERS 19

IN SUMMARY 19

SUGGESTED ANSWERS TO SELF-ASSESSMENT EXERCISES 19

CHECKLIST 21

CHAPTER TWO

PARTICIPANTS IN THE INDIAN FINANCIAL SYSTEM

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About this topic 23

Topic objectives 23

1. Participants in the Finance Industry 24

1.1 Participants and the flow of funds 24

1.2 Who is an intermediary? 24

1.3 Intermediaries and financial markets 25

1.4 Advantages of financial intermediaries 25

1.5 Disadvantages of financial intermediaries 26

2. Types of Financial Services 27

2.1 Retail financial services 28

2.2 Wholesale financial services 29

2.3 Mutual funds 32

3. Intermediaries in the Indian Financial System 34

3.1 The Reserve Bank of India 34

3.2 Banks 34

I-8 CONTENTS

3 Investment banks 35

3.4 Finance companies 36

3.5 Housing finance companies 36

3.6 Fund managers 36

3.7 Stock brokers 36

3.8 Superannuation funds 36

3.9 Life insurance companies 37

3.10 Conclusion 38

REVIEW 39

QUESTIONS 39

ANSWERS 40

IN SUMMARY 40


CHECKLIST 42

CHAPTER THREE

INDIAN ECONOMIC ENVIRONMENT

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About this topic 45

Topic objectives 45

1. Introduction to economics and Indian economy 46

1.1 What is Economics? 46

1.2 Objectives of economic policies 46

1.3 Indian economy today 47

1.4 Economic Growth & National Income 47

1.5 Inflation 48

1.6 Role of money in inflation 49

2. Economic Policies and Tools 49

2.1 Monetary policy 49

2.2 Open Market Operations 50

2.3 Discount Rate Policy 50

2.4 Reserve requirements as tool 50

2.5 Interest rate regulation 50

CONTENTS I-9

6 Using monetary policy 51

2.7 Fiscal policy 51

3. Macroeconomics 52

3.1 Multiplier Model 52

3.2 Business cycles 53

3.3 International trade and balance of payment 53

3.4 Foreign exchange market 54

3.5 Capital and Money Markets 54

4. Economic indicators and value of investment 55

5. Media and Information sources 56

5.1 The financial press 56

5.2 Research papers 56

5.3 Company reports 57

5.4 Official sources of data as per economic calendar 57

REVIEW 57

QUESTIONS 57

ANSWERS 58

IN SUMMARY 58


CHECKLIST 60

CHAPTER FOUR

INDIAN SOCIAL ENVIRONMENT &FINANCIAL PLANNING

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About this topic 62

Topic objectives 62

1. The consumer life cycle 63

1.1 Stages of the life cycle 63

1.2 Non-traditional life cycle stages 64

1.3 Demographic trends underlying the life cycle 64

1.4 The Changing workforce 65

1.5 Variables that influence financial behaviour over the life cycle 65

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Stage by stage analysis 69

2.1 The alpha stage 69

2.2 The bravo stage 71

2.3 The charlie stage 72

2.4 The delta stage 74

2.5 The echo stage 75

2.6 The foxtrot stage 76

2.7 Non-traditional individuals 78

3. The Wealth cycle 79

3.1 Accumulation 79

3.2 Preservation 80

3.3 Distribution 81

REVIEW 81

QUESTIONS 81

ANSWERS 82

IN SUMMARY 83

CHECKLIST 83

CHAPTER FIVE

EFFECTIVE COMMUNICATION IN FINANCIAL COUNSELLING

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About this topic 85

Topic objectives 85

1. Introduction 86

1.1 Three types of structured communication 86

1.2 Interviewing 86

1.3 Counselling 88

1.4 Advising 88

2. Essentials in financial counselling 89

2.1 Structure 90

2.2 Rapport 91

2.3 Recognizing resistance 91

2.4 Common areas of resistance 92

CONTENTS I-11

Profile of the effective counsellor 93

3.1 Unconditional positive regard 94

3.2 Accurate empathy 95

3.3 Genuineness 95

3.4 Self-awareness 96

4. Basic communication principles 99

5. Elements of non-verbal behaviours 101

5.1 The body 102

5.2 The voice 104

5.3 Interpreting the meaning of non-verbal behaviours 105

6. Attending and listening skills 106

6.1 Physical Attending 106

6.2 Active listening 107

6.3 Responding during active listening 108

7. Counsellor leading responses 112

8. The question 114

8.1 Open-ended versus close-ended questions 115

8.2 Leading questions 115

8.3 The Either/Or or True/False question 116

8.4 Why questions 116

8.5 Question bombardment 117

REVIEW 118

QUESTIONS 118

SELF-TEST QUESTIONS 120

ANSWERS 121

IN SUMMARY 125


CHECKLIST 126

CHAPTER SIX

INTRODUCTION TO INVESTMENTS

Preview 128

About this topic 128

Topic objectives 128

I-12 CONTENTS

Introduction to investments 129

1.1 Prakash : A Young Couple’s Finances 129

1.2 Investment process 130

2. Characteristics of investments 130

2.1 Return 131

2.2 Risk 137

2.3 Risk-expected return trade off 138

2.4 Liquidity 138

2.5 Marketability 139

2.6 Investment effort 139

2.7 Minimum investment size 140

2.8 Ethical and Moral appeal 140

3. Psychological aspects of investing 143

REVIEW 145

QUESTIONS 145

SELF-TEST QUESTIONS 145

ANSWERS 146

IN SUMMARY 147


CHECKLIST 150

CHAPTER SEVEN

MEETING CLIENT’S NEEDS THROUGHFINANCIAL PLANNING

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1. Various views of financial planning 152

1.1 Single purpose view 152

1.2 Multiple purpose view 152

1.3 Comprehensive view 153

2. The evolution of financial planning as a profession 154

2.1 Financial planning as a process 155

CONTENTS I-13

2 The general model 155

2.3 The CFP board model 161

3. Good practices in financial planning 164

4. Content of a comprehensive financial plan 171

4.1 Overview of plan elements 172

4.2 Guidelines for a Comprehensive Financial Plan 172

APPENDIX : PREPARING FINANCIAL STATEMENTS 177

REVIEW 185

QUESTIONS 185

ANSWERS 186

IN SUMMARY 189


CHECKLIST 190

CHAPTER EIGHT

RECOMMENDING FINANCIAL PLANNINGSTRATEGIES TO INVESTORS

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1. Financial Planning Strategies - Investing for the long term 192

1.1 Power of compounding 192

1.2 Choose a strategy to maximise returns on investment 193

1.3 Choose the Right Financial Planning Strategies 194

2. Asset allocation - The strategic tool 195

2.1 Asset Allocation Principles 195

2.2 Benjamin Graham’s 50/50 Balance 196

2.3 Strategic Asset Allocation 196

2.4 Fixed vs. Flexible Asset Allocation 197

2.5 Tactical Asset Allocation 198

2.6 Increased return without increased risk? 198

3. Comparison of products 199

3.1 Comparison by nature of investment 199

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2 Comparison by current performance 201

3.3 Direct Equity Investment versus Mutual Fund Investing 201

3.4 Bank Deposits versus Debt Funds 203

3.5 Mutual Funds - The Best Investment Option? 204

REVIEW 205

QUESTIONS 205

ANSWERS 206

IN SUMMARY 206

CHECKLIST 206

CHAPTER NINE

REGULATION OF THE INDIAN FINANCIAL SYSTEM

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1. Regulation of the Indian Financial System 209

1.1 Why is regulation necessary? 209

1.2 Drivers of regulatory change in India 209

2. Regulatory Authorities 210

2.1 Reserve Bank of India (RBI) 210

2.2 Securities and Exchange Board of India (SEBI) 212

2.3 Insurance Regulatory & Development Authority (IRDA) 213

3. Self-Regulatory Bodies 214

3.1 Indian Stock Exchanges 214

4. Ethics in the Securities Industry 217

REVIEW 217

QUESTIONS 217

ANSWERS 218

IN SUMMARY 219


CHECKLIST 220

CONTENTS I-15

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PART II

PLANNING AND WEALTH CREATION

CHAPTER ONE

INTRODUCTION TO FINANCIAL PLANNING

Preview 225



1. Background 226

1.1 Inflation 227

1.2 The growth of credit 228

1.3 Government need for increased revenue 228

1.4 Regulation and deregulation 230

1.5 Demographic shifts 231

2. What is Financial Planning? 233

2.1 The importance of risk profiling 234

2.2 Pre- and post-retirement planning 235

2.3 Users of financial planning services 236

3. The Role of a Financial Planner 238

3.1 The role of a financial planner 238

3.2 Who provides financial planning? 239

3.3 Increasing professionalism of financial planners 242

3.4 Remuneration 244

3.5 You and your client 244

3.6 You and your dealer 245

4. Regulatory Controls and Practices 247

4.1 Reasonable basis for recommendations (Section 851) 247

4.2 Limited advice 248

4.3 Disclosure of commissions and fees (Section 849) 248

4.4 Disclosure of identity 250

4.5 Register of interests in securities 251

4.6 Advertising and projections about securities 251

4.7 In summary — A brief overview of advisers’ liability 251

I-16 CONTENTS

8 ASIC field audits 252

4.9 ASIC licensing review 252

REVIEW 256

QUESTIONS 256

ANSWERS 257

IN SUMMARY 257

SUGGESTED ANSWERS TO SELF ASSESSMENT EXERCISES 258

FURTHER READING 259

CHECKLIST 259

CHAPTER TWO

RISK MANAGEMENT AND INSURANCE PRODUCTS

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1. Risk Management by Insurance 262

1.1 Property risk 264

1.2 Income risk 265

1.3 Self-insurance 265

1.4 Liability 266

2. General Insurance 267

2.1 Principles of general insurance 267

2.2 Range of general insurance 268

2.3 Specific types of general insurance 270

3. Commercial Insurance 273

3.1 Business overhead insurance 273

3.2 Key person insurance 274

3.3 Fire and damage insurance 274

3.4 Liability insurance 274

3.5 Workers’ compensation 274

3.6 Professional indemnity insurance 274

4. Professional Indemnity (PI) Insurance 275

4.1 The policy 275

CONTENTS I-17

2 Steps to purchasing a policy 276

4.3 Costs 277

5. Life Insurance 278

5.1 Traditional or permanent life insurance 279

5.2 Term insurance 280

5.3 How much cover is needed? 284

6. Personal Risk Insurance 285

6.1 Total and permanent disablement (TPD) insurance 285

6.2 Income continuation insurance 286

6.3 Calculating the required income protection cover 288

6.4 Trauma insurance plans 289

6.5 Trauma cover and income protection compared 291

6.6 Health insurance 291

7. Regulation 292

7.1 Background 292

7.2 IRDA 293

7.3 Obligations of insurers to rural and social sectors 296

8. Product Producers and Distributors 297

8.1 Insurance product providers 297

8.2 Agents and brokers 299

9. Five Steps to Advising on Life Insurance 308

9.1 Identification of risk insurance needs 309

9.2 Product and underwriter selection 311

9.3 Cost of insurance 311

9.4 Policy ownership 312

9.5 Implementation 312

9.6 Regular reviews 313

10. Provision of Insurance Products by Financial Planners 313

REVIEW 314

QUESTIONS 314

ANSWERS 314

IN SUMMARY 315


I-18 CONTENTS

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CHECKLIST 319

APPENDIX 321

CHAPTER THREE

FUNDAMENTAL INVESTMENT CONCEPTS

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1. The Time Value of Money 324

1.1 Time value of money 324

1.2 Simple interest 325

1.3 Application in the money market 328

2. The Principle of Compounding 328

2.1 Powers 329

2.2 Compounding 329

2.3 Compounding frequency 331

2.4 What is the effective rate of interest? 332

3. Risk-Reward Trade-Off 336

4. Rational Choices 338

4.1 Asset allocation and diversification 338

4.2 ‘Know your client’ rule 339

5. Diversification - ‘Spreading Risk’ 339

6. Investment Timing 343

6.1 Entry point 343

6.2 Holding period 344

6.3 Exit point 344

6.4 Strategies to eliminate timing problems 344

6.5 Lifestyle timing 346

7. Direct Investments - What are they and who uses them? 347

7.1 Characteristics of direct investment 347

7.2 Why do people invest? 350

7.3 Investment market drivers 353

7.4 Buyers in investment markets 354

REVIEW 355

CONTENTS I-19

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QUESTIONS 355

ANSWERS 355

IN SUMMARY 356


CHECKLIST 358

CHAPTER FOUR

THE ECONOMIC ENVIRONMENT

Preview 360



1. Introduction to Economics 361

1.1 The relevance of economics to financial planners 361

1.2 Economics as a study 362

1.3 Basic concepts of utility maximisation and supply and demand 364

2. What is the ‘Economy’? 365

2.1 The importance of an understanding of economic concepts 365

2.2 Creating a view of the economy 366

2.3 The circular income flow 366

2.4 Important economic terms 368

2.5 Inflation 369

3. The Finance Sector 371

3.1 The money supply and credit 371

3.2 Interest rates 372

4. Different Economic Systems 374

4.1 Changes over time 374

4.2 Government and private enterprise in a mixed economy 375

5. Global economic forces 377

5.1 Macroeconomics - India 377

5.2 The Indian people 378

5.3 International influences 379

5.4 Exchange rate policy 382

5.5 Economic growth 384

I-20 CONTENTS

Investment Intermediaries 384

6.1 Main intermediary groups 384

6.2 The Government as an intermediary 385

6.3 Interaction and flow of funds 386

7. Impact of Government Policies 388

7.1 Fiscal and monetary policies 388

7.2 Wages policy 389

8. Economic or Business Cycles 390

8.1 Stages of business cycles 390

8.2 Duration of cycles 394

9. Effects on Investment Values 395

10. Approaches to Analysis 396

10.1 Top-down approach 396

10.2 Bottom-up approach 397

11. Media and Information Sources 399

11.1 The financial press 399

11.2 Research papers 399

11.3 Company reports 400

11.4 Economic calendar 400

REVIEW 401

QUESTIONS 401

ANSWERS 401

IN SUMMARY 401

ADDITIONAL RESOURCES 401

SUGGESTED ANSWERS TO SELF ASSESSMENT EXERCISES 402

CHECKLIST 404

APPENDIX 406

CHAPTER FIVE

ASSET CLASSES

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1. The Asset Classes, their Behaviour and Expected Returns 409

CONTENTS I-21

Cash 411

2.1 The money market 411

3. Domestic Fixed Interest 412

3.1 The fixed interest market (debt market) 412

3.2 Types of interest-bearing investments 412

3.3 The yield curve 420

3.4 Advantages and disadvantages of interest-bearing securities 421

3.5 Main influences on fixed interest markets 422

3.6 Risks associated with fixed interest securities 422

4. Domestic Equities 424

4.1 Equities 424

4.2 Equity (share) investments 425

4.3 The share market 425

4.4 Share classes 426

4.5 Issuing shares 427

4.6 Characteristics of shares 428

4.7 Analysing company shares 429

4.8 Investing in the share market 431

4.9 Share market indices 431

5. Property 433

5.1 Main types of property 433

5.2 Diversification within the property asset class 435

5.3 The role of property in a diversified portfolio 435

5.4 Characteristics of direct property investment 437

5.5 Direct property investment - Advantages and disadvantages 438

5.6 Return characteristics of property 438

5.7 Property analysis 439

6. International 440

6.1 The case for international investment 440

6.2 Global diversification 441

6.3 Types of international investments 443

7. The Role of Derivatives 443

7.1 What are derivatives? 443

7.2 Market characteristics 443

I-22 CONTENTS

3 Futures 445

7.4 Share Price Index (SPI) futures 445

7.5 Options 445

7.6 Some options strategies 446

7.7 Risks of derivatives and regulatory issues 447

8. Other Specialist Asset Classes 449

8.1 Gold 449

8.2 Infrastructure 451

8.3 Private capital or unlisted equity investment 452

8.4 Individual mortgages 452

8.5 Collectables and precious metals 453

8.6 Endowment warrants 453

8.7 Tax-driven investments 453

9. Asset Allocation 453

9.1 Building a portfolio 454

REVIEW 456

QUESTIONS 456

ANSWERS 456

IN SUMMARY 457


CHECKLIST 461

APPENDICES 464

CHAPTER SIX

INVESTMENT PRODUCTS

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1. Managed Funds 467

1.1 Introduction 467

1.2 Distribution 470

1.3 Legal structures adopted by managed funds 473

2. Mutual Funds 473

2.1 Background 473

CONTENTS I-23

2 Legal structure 473

2.3 NAV, expenses, sale, repurchase and load 474

2.4 Comparison of a mutual fund (trust) with a company 476

2.5 The offer document 477

2.6 Unit price and cash flows 480

2.7 Fees and adviser remuneration 480

2.8 Taxation of mutual funds 482

3. Portfolio Management Schemes (PMSs) 482

4. Superannuation and Rollover Funds 484

4.1 Taxation of superannuation and rollover funds 485

4.2 Pooled superannuation trusts (PSTs) 485

5. Insurance Bonds 485

6. Product Design 487

6.1 Asset allocation 488

6.2 Stock selection 489

7. Examples of Managed Funds 490

7.1 Cash management funds/Liquid funds 491

7.2 Equity funds 491

7.3 Bond funds 493

7.4 Property funds 493

7.5 Mortgage trusts 495

7.6 International equity funds 495

7.7 Capital guaranteed funds 496

7.8 Capital stable funds 497

7.9 Capital protected funds 497

7.10 Indexed funds 497

7.11 Balanced or growth-oriented funds 498

7.12 Specialised funds 498

7.13 Exchange-traded funds 499

8. Evaluating Managed Funds 499

8.1 Factors to consider 499

8.2 Benchmarks and performance appraisal 501

8.3 Industry standards 502

8.4 Research providers 503

I-24 CONTENTS

Current Trends in Managed Funds 508

9.1 Globalisation of the managed funds industry 508

9.2 Choice of investments 508

9.3 Self-managed superannuation funds (SMSFs) or do-it-yourself (DIY) funds 508

9.4 Master trusts 508

REVIEW 510

QUESTIONS 510

ANSWERS 510

IN SUMMARY 511


CHECKLIST 513

CHAPTER SEVEN

TAXATION PART 1

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1. Principles of Taxation 517

1.1 Taxation is a social contract 517

1.2 Uncertainty and change 517

1.3 Taxation as part of fiscal policy 518

1.4 Government tax strategies 519

1.5 How tax rules are made 520

1.6 Gross income, deductions, rebates and tax 521

2. Components of Tax Liability 522

2.1 Gross total income excluding exempt income 522

2.2 Total income for rate purposes - gross total income less deductionsunder Chapter VI-A 523

2.3 Calculation of tax owing at personal tax rates 525

3. Some other principles of taxation 527

3.1 Tax residential status 527

3.2 Categories of taxable income 528

3.3 Marginal versus average rates 528

3.4 Minors’ unearned income 529

CONTENTS I-25

5 Types of taxpayers 529

4. Taxation of Direct Investments 530

4.1 Savings and fixed interest 530

4.2 Shares 531

4.3 Property 532

4.4 Other direct investments 532

4.5 Keeping records for tax 532

5. Taxation of Pooled (Managed) Investments 533

5.1 Mutual funds 533

5.2 Insurance bonds 533

6. Self-assessment, returns and payment of Income-tax 533

6.1 Self-assessment 533

6.2 Return of income 533

6.3 Payment of tax 534

7. Taxation of Perquisites and Fringe Benefits 536

REVIEW 537

QUESTIONS 537

ANSWERS 537

IN SUMMARY 538


CHECKLIST 539

CHAPTER EIGHT

TAXATION PART 2

Preview 540



1. Capital Gains Tax 541

1.1 What is capital gains tax (CGT)? 541

1.2 What assets are subject to CGT? 541

1.3 What is ‘transfer’? 541

1.4 What is not a transfer? 542

1.5 What are short-term and long-term capital gains/losses? 542

1.6 When does CGT apply? 543

I-26 CONTENTS

7 How is capital gain computed? 543

1.8 What is indexation? 544

1.9 What tax rate is applicable for capital gains? 545

1.10 How is CGT calculated? 546

1.11 A few special cases 547

1.12 Exemptions 549

1.13 Venture capital fund/venture capital company 551

1.14 Infrastructure capital fund/infrastructure capital company 551

1.15 Setting off and carrying forward of losses 551

1.16 How does CGT affect the investor? 552

2. Tax Avoidance versus Tax Evasion 553

2.1 Income-tax planning 553

2.2 Strategies to minimise taxation 554

3. Gearing and Debt Management 556

3.1 Two examples 557

3.2 Sources of borrowed funds 559

3.3 Issues with borrowing (gearing) 560

3.4 The true cost of consumer credit 563

3.5 Determination of outstanding debt 564

3.6 Housing loans 565

3.7 Loans for shares 567

4. Borrowing v. Repayment of Existing Loans 570

4.1 Example : Return on fixed interest investment v. mortgage cost 570

4.2 Example : Investment involving growth 571

4.3 Example : Negative gearing 572

4.4 Conclusion 572

5. Case Studies using Negative Gearing 574

5.1 Negative gearing for property 574

5.2 Negative gearing for equities 574

5.3 Comparing the two case studies 575

6. Other Forms of Gearing 575

6.1 Gearing without direct debt 575

6.2 Stripped investments 576

CONTENTS I-27

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REVIEW 579

QUESTIONS 579

ANSWERS 579

IN SUMMARY 580


CHECKLIST 584

CHAPTER NINE

ESTATE PLANNING

Preview 586



1. What is a will? 587

1.1 Characteristics of a will 588

1.2 What are the types of wills? 588

1.3 Codicils 590

1.4 What is the legal framework for wills? 590

1.5 Who can make a will? 591

1.6 Are there any constraints on the operation of a will? 591

1.7 Who can take property under a will? 592

1.8 Structure of a will 594

1.9 Drafting a will 594

1.10 Is registration of will compulsory? 596

1.11 Other formal requirements 597

1.12 Does a will last? 599

1.13 Revocation of wills 600

1.14 How are the wishes of the deceased honoured? 600

1.15 No delegation of testamentary power 600

1.16 Avoiding potential challenges against a will 600

2. Dying without a will 602

2.1 Who gets what? 602

3. Administration of an Estate 605

3.1 The executor 605

3.2 Probate 607

I-28 CONTENTS

3 Administration of debts and bankrupt estates 609

3.4 Ademption of legacy 610

3.5 Can Hindu undivided family (HUF) be implied from will? 610

3.6 What is Mohammedan law of will? 610

4. How Else May Assets Pass? 611

4.1 Tenant-in-common 612

4.2 Joint tenant 612

4.3 Contract 613

4.4 Ownership by a company 614

4.5 Assets controlled by the trustee of a discretionary trust 614

4.6 Assets in the name of children 615

4.7 Superannuation benefits 615

5. Dwelling House 616

6. Powers of Attorney 616

6.1 End of power of attorney 617

7. Tax Planning through Wills and Trusts 617

8. Taxation of terminal benefits 619

REVIEW 621

QUESTIONS 621

ANSWERS 623

IN SUMMARY 626


CHECKLIST 628

APPENDICES 630

CHAPTER TEN

TOWARDS A FINANCIAL PLAN

Preview 634



1. Working with Clients 636

1.1 The client introduction 636

1.2 The Financial Services Guide (FSG) 637

CONTENTS I-29

Gathering Initial Information from the client 639

2.1 Data collection 639

3. Additional Information 645

3.1 Financial goals 645

3.2 Assessing risk tolerance 647

3.3 Analysis of insurance needs 648

3.4 Analysis of retirement savings 649

3.5 Analysis of investment preferences 650

3.6 The conclusion of the first interview 650

4. Meeting the Client’s Objectives 651

4.1 General requirements 651

4.2 Disclosure 651

4.3 Recommendations 652

5. Asset Allocation 654

6. Selection of Investment and Insurance Products 655

7. Implementation 656

7.1 The written plan 656

7.2 Your action plan 656

8. Ongoing Service 658

REVIEW 658

QUESTIONS 658

ANSWER 659

IN SUMMARY 659

APPENDICES 659

I-30 CONTENTS

part i introduction to financial planning1.5 demographic shifts 231 2. what is financial planning?...

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