Chapter 2 Components of a Financial Plan

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Across
  1. 1. The amount of money put aside for future use
  2. 3. A document that explains a person’s final wishes upon death and is often included as part of estate planning
  3. 5. The amount of money you need to pay for or buy something
  4. 6. worth When you add up the value of all of your assets and subtract your liabilities
  5. 9. The amount of money received from earnings from a job or business, an allowance, gifts, interest on savings, or proceeds from selling items you don’t need anymore
  6. 10. responsibility The responsibility of financial planners to put the needs of their clients first and act in a trustworthy way to protect and manage their clients’ money
  7. 13. Something you own, such as a car, investment accounts, bank accounts, a home, or an electric guitar
  8. 14. asset An asset that is easily convertible into a fixed amount of cash, such as money you have in the bank or investment accounts
  9. 15. Moral principles of conduct
  10. 16. financial plan A strategy for how you will spend, save, and invest your money today and into the future
  11. 18. Using money to create wealth over time and is achieved through investment vehicles such as stocks, bonds, and mutual funds, among others
  12. 19. What you owe, such as a car loan, school loans, or a cell phone contract
  13. 20. fund Consists of three to six months of expenses that can help offset unexpected events, such as a car breakdown or phone loss
  14. 22. financial plan Holds a similar purpose to a personal financial plan in that its primary objective is to devise a strategy for how a company will spend, save, and invest its funds for maximum profitability
  15. 23. worth statement A document showing your assets minus liabilities
Down
  1. 2. asset An asset that is more difficult to convert to cash, and its value often relies on economic conditions
  2. 4. A way to transfer the risk of loss
  3. 7. planning Planning for what to do with one’s assets in the event of death
  4. 8. planner A professional who can help you plan and manage your financial future
  5. 11. and expense record Serves as a cash flow management tool to document how money is used and saved
  6. 12. responsibility To hold yourself accountable for decisions you make
  7. 17. When you withdraw yourself from an active working life
  8. 21. flow A snapshot of the money coming in and money going out
  9. 22. A detailed estimate of income and expenses for a specific period of time