LIBF Unit 3 Topic 1 || All Answers are Valid.
Why is sustainability important? correct answers For the short, medium and long terms - so that
individuals can satisfy their needs and achieve as many of their wants and aspirations as they can
afford within their budget.
House Repossessions correct answers The number of properties repossessed each year over the
same period also saw a huge increase, from just over 8,000 in 2004 to a peak of nearly 49,000 in
2009.
Only the historically low interest rates that have prevailed since the Bank of England cut Bank
rate to 0.5 per cent in March 2009 prevented further rises in repossessions.
How can personal sustainable finance be achieved? correct answers 1.Be aware of exactly how
much money they are spending.
2.Use weekly or monthly budgets and cash-flow forecasts.
3.know the implications of future events and aspirations
4.Have a savings plan to build up the capital sums that they expect to need in the future.
5.Carefully plan any borrowing and only borrow amounts that they can pay back.
6.Have an adequate emergency fund to fall back on when there is an unexpected
reduction in income (if they are made redundant, for example).
7.Pay into a pension scheme to ensure that they will have an adequate income in retirement.
, 8.Look for ways to increase their incomes - whether through promotion and career development,
or by working overtime, taking on a second job.
9.Make use of appropriate insurance products to protect their incomes;
10.Regularly monitor, review and amend their financial plans.
11.Have clear, realistic contingency plans to deal with the unexpected events that can disrupt
their carefully made plans completely.
What are the characteristics of a flexible financial plan? correct answers 1. Balanced between
time periods
2. Informed
3. Able to adapt to changing products and services
4. Fluid
5. Realistic
Why does a flexible financial plan need to be balanced between time periods? correct answers
The plan should look at income and expenditure in the short, medium and long terms, and there
should be a good balance between these periods.
Why does a flexible financial plan need to be informed? correct answers Like any other plan, a
dynamic financial plan must be based on accurate information as far as possible.
Why does a flexible financial plan need to be able to adapt to changing products and services?
correct answers Several versions of budgets and cash-flow plans might be made to reflect
potential changes in a product's features, terms or conditions.
Why is sustainability important? correct answers For the short, medium and long terms - so that
individuals can satisfy their needs and achieve as many of their wants and aspirations as they can
afford within their budget.
House Repossessions correct answers The number of properties repossessed each year over the
same period also saw a huge increase, from just over 8,000 in 2004 to a peak of nearly 49,000 in
2009.
Only the historically low interest rates that have prevailed since the Bank of England cut Bank
rate to 0.5 per cent in March 2009 prevented further rises in repossessions.
How can personal sustainable finance be achieved? correct answers 1.Be aware of exactly how
much money they are spending.
2.Use weekly or monthly budgets and cash-flow forecasts.
3.know the implications of future events and aspirations
4.Have a savings plan to build up the capital sums that they expect to need in the future.
5.Carefully plan any borrowing and only borrow amounts that they can pay back.
6.Have an adequate emergency fund to fall back on when there is an unexpected
reduction in income (if they are made redundant, for example).
7.Pay into a pension scheme to ensure that they will have an adequate income in retirement.
, 8.Look for ways to increase their incomes - whether through promotion and career development,
or by working overtime, taking on a second job.
9.Make use of appropriate insurance products to protect their incomes;
10.Regularly monitor, review and amend their financial plans.
11.Have clear, realistic contingency plans to deal with the unexpected events that can disrupt
their carefully made plans completely.
What are the characteristics of a flexible financial plan? correct answers 1. Balanced between
time periods
2. Informed
3. Able to adapt to changing products and services
4. Fluid
5. Realistic
Why does a flexible financial plan need to be balanced between time periods? correct answers
The plan should look at income and expenditure in the short, medium and long terms, and there
should be a good balance between these periods.
Why does a flexible financial plan need to be informed? correct answers Like any other plan, a
dynamic financial plan must be based on accurate information as far as possible.
Why does a flexible financial plan need to be able to adapt to changing products and services?
correct answers Several versions of budgets and cash-flow plans might be made to reflect
potential changes in a product's features, terms or conditions.
