Recognize relationships among financial documents and money management activities.

Learning Objective # 1

Planning for Successful Money Mangement

Money Management: Day-to-day financial activities necessary to manage current personal economic resources while working toward long-term financial security.

Daily spending and saving decisions are at the centre of financial planning

Coordinate these decisions with your needs, goals and personal situation

Maintaining financial records and planning your spending are essential to success

LO#1

Opportunity Costs & Money Management

Spending money reduces the amount you can save and invest.

Saving and investing reduces the amount you can spend now.

Buying on credit ties up future income. Using savings for purchases results in

lost interest earnings - savings can’t be used for other purposes.

Comparison shopping can save you money but uses up valuable time

LO#1

Major Money Management Activities

Store and maintain personal financial records and documents

Create personal financial statements (balance sheets and cash flow statements or income and outflow

Create and implement a plan for spending and saving (budgeting)

LO#1