SOLUTION MANUAL Personal Finance, 14th Edition By E. Thomas Garman, Chapter 1 - 17 Complete Guide.

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SOLUTION MANUAL

Personal Finance, 14th Edition

By E. Thomas Garman, Chapter 1 - 17




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TABLE OF CONTENTS ik ik i k




Part I: FINANCIAL PLANNING.
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1. Understanding Personal Finance. ik ik




2. Career Planning. ik




3. Financial Statements, Goals, and Budgets.
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Part II: MONEY MANAGEMENT.
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4. Managing Income Taxes. ik ik




5. Managing Checking and Savings Accounts.ik ik ik ik




6. Building and Maintaining Good Credit.
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7. Credit Cards and Consumer Loans.
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8. Vehicles and Other Majory Purchases.
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9. Obtaining Affordable Housing. ik ik




Part III: INCOME AND ASSET PROTECTION.
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10. Managing Property and Liability Risk. ik ik ik ik




11. Planning for Health Care Expenses. i k ik i k i k




12. Life Insurance Planning.
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Part IV: INVESTMENTS.
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13. Investment Fundamentals. ik




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14. Investing in Stocks and Bonds. i k i k ik i k




15. Mutual and Exchange-Traded Funds. ik ik ik




16. Real Estate and High-Risk Investments.
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17. Retirement and Estate Planning. ik ik i k




SolutionandAnswerGuide ik ik ik




GARMAN/FOX, i k PERSONAL i k i k FINANCE i k i k 14E, i k CHAPTER i k i k 1: i k THINKING i k i k LIKE i k i k AY i k FINANCIAL i k



PLANNER
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TABLE OF CONTENTS
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I I K I K




Answers i k to i k Chapter i k Concept i k Checks ................................................................................2
What i k Do i k You i k Recommend i k Now? .....................................................................................4
Let’s i k Talk i k About i k It .................................................................................................................5
Do i k the i k Math .............................................................................................................................6
Financial Planning i k i k Cases...........................................................................................................8
Extended i k Learning .................................................................................................................... 10




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ANSWERS TO CHAPTER CONCEPT CHECKS IK I K I K I K




LO1.1 i k Recognize i k the i k keys i k to i k achieving i k financial i k success.
1. Explain i k the i k five i k steps i k in i k the i k financial i k planning i k process.

Answer: There are five fundamental steps to the personal financial planning
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process:
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(1) evaluate your
i k financial health to your education and career choice; (2) i k i k i k i k i k i k i k i k i k i k



define your financial goals; (3) develop a plan of action to achieve your
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i goals; (4) implement spending and saving plans to monitor and control
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progress toward your goals; and (5) review your financial progress and make
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changes as appropriate.
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2. Distinguish i k among i k financial i k success, i k financial i k security, i k and i k financial i k happiness.

Answer: Financial success is the achievement of financial aspirations that are
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desired, planned, or attempted. Success is defined by the individual or
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i family that seeks it.
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Financial success may be defined as being able to live according to
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i one’s standard ofy living. Financial security is that comfortable feeling that
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your financial resources will be adequate to fulfill any needs you have
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i as well as your wants. Financial
k i k happiness is the experience you i k i k i k i k i k i k ik i k i k



i have when you are satisfied with money matters. People who are
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happy about their finances will see a spillover into positive feelings
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i about life in general.
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3. Summarize i k what i k you i k will i k accomplish i k studying i k personal i k finance.

Answer: Several things can be accomplished by studying personal finance.
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iRecognize how to manage unexpected and expected financial events. Pay
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i as little as possible in income taxes.
k i k Understand how to effectively i k i k i k i k ik i k i k i k i k



icomparison shop for vehicles and homes. Protect what we own. Invest
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wisely. Accumulate and protect the wealth that we may choose to spend
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during our non-working years (e.g., retirement) or donate.
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4. What i k are i k the i k building i k blocks i k to i k achieving i k financial i k success?

Answer: The building blocks for achieving financial
i success include a
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foundation ofy regular income that provides the means to support your
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i lifestyle and save for desired goals in the future. The
k i foundation supports
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a base of various banking
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benefits. Then
i k we can establish goals, a recordkeeping system, a budget,
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and an emergency savings fund. We will also manage various expenses such
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as housing, transportation, insurance, and the payment of taxes. We will also
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need to handle credit, savings, and educational costs. Finally, we invest
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i in various investment alternatives such as mutual funds, stocks, and bonds,
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often for retirement. As a result of all these building blocks, we
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i are more apt to have a financially successful life.
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LO1.2 i k Understand how i k i k the i k economy i k affects i k your i k personal i k financial i k success.
1. Summarize i k the i k phases i k of i k the i k business i k cycle.
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