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Assessment 2 Word Template

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Assessment 2 Word Template

While writing responses to the prompts below, you may need to refer back to the budget you created in the Assessment 2 Excel Template. Make sure you have completed your budget before completing this portion of the assessment.

Questions

  1. Identify the savings goal and the time frame you determined for reaching your goal. Why is the time frame you identified realistic? How did you arrive at this?: Assessment 2 Word Template.

Think about how long you expect it to sell or rent your current home, the price of purchasing or renting in your New City, et cetera. Use research from the course reading or outside sources to support your time frame.

[The savings target in this financial plan is to meet the needs of transitioning to a new city while keeping an economic balance. The time frame that has been put in place to achieve this goal is one year. This period is realistic because it provides enough time to list, market, and negotiate the sale or rental of the current house about market supply time in the new city and to make the final decision on purchasing or renting a new home in the new town. The house is estimated to be sold at $375,000, while the fair market is $300,000.

On the other hand, rental income is expected to be $24,000 per annum Based on experience. This timeframe also includes expenses for covering moving costs and time to adapt to the new city’s financial obligations, including, for example, housing expenses ranging from $ 18,000 per year for rent to $ 200,000 for purchasing a house.

The plausibility of this timeframe is founded on information derived from today’s real estate market, where it takes anywhere from 30 to 60 days to sell a home when listed, with additional time preparing for the same and closure (Hayes, 2019). Releasing rental real estate is relatively more straightforward, as the property owner could be letting out the real estate the same day the property is ready.

This schedule ensures that the incoming money is sufficient to offset necessary expenses such as transportation, food, and other bills that cover health. Allowing strict average hours of 200 and 250, respectively, for relocations authenticates this approach, with additional research on periods underpinning such housing trends accomplishing validation of economic goals aligned with practicality.

  1. Explain why you chose the housing option you did and how it will help you achieve your selected financial goal.
    1. What considerations, if any, did you give to the following when selecting your housing option?
      1. Time frame for savings goal.
      2. Familial situation.
  1. Trade-off decisions.
  2. Other considerations.

[This approach is favorable to my financial plan of being financially stable during the transition to gradually affording a home. With $1500 per month being effectively utilized to pay for $18,000 yearly rent, it enables appropriate management of other everyday expenses, beginning with moving charges and ending with being able to afford other essential expenses.

Some of the things that should be taken into consideration when making the decision include

  1. Explain your choices for non-rent expenditures and how they will help achieve your savings goal within the time frame.
    1. How did you make the choices you did regarding non-housing expenditures?
    2. How do your expenditures align with the financial goal you selected?

[In the case of the non-housing expenditure, I focused on necessities such as food, medical expenses, and transport expenses, with little spending on entertainment and other miscellaneous costs. These allocations are made strategically to avoid spending a lot of money during the vanity equation, thus allowing me to save and achieve my financial goal within one year.

Essential Needs Prioritization: I considered $7,000 for meals, $12,000 for medical annually, and $15,540 for travel annually. These choices come from the best estimates given research about the costs of living within the new city so my family can meet all of our basic needs while not going over budget.

Controlled Discretionary Spending: To entertain people, $4,440 was approved, and for other miscellaneous expenses, $2,200 was approved. These amounts allow for some laxity in terms of lifestyle expenditure but keep the essential or inconsequential expenditure tightly contained.

Savings Emphasis: I invested $8,880 in savings and debt to make it a part of my financial plan.

My expenditure plan maintains a general savings rate of 9%, coupled with rental income from my existing house or sale proceeds, which is sufficient to support the savings target (Hill, 2018). I avoid fulfilling all the essential expenditures and expenses by limiting my extravagance and spending only on what is important to pay back.

Also, this strategy helps to enhance the amount of financial security in the cash reserve so that in case of moving or any other unexpected expenses or even an emergency, I can stay on course to my savings goals with no harm done. The choices are within a prudent but feasible budget plan to allow me to meet my short-term and long-term goals.

  1. Reflect on the productivity strategies you used to break down your financial plan into smaller steps to help you stay organized and productive.
    1. How closely did you follow the plan you thought through earlier in the assessment instructions?
    2. How did a step-by-step and organized approach help you to adjust your financial priorities and financial plan?
    3. How did the approach you use draw upon productivity strategies that you had previously learned?

[I applied such techniques as time milestones, priority, and timeline to subdivide my financial plan and perform its tasks step by step. This format efficiently managed my time and tasks, and it simply provided the framework where I could stick to my main plan and adapt to the levels of importance. It used operational approaches such as task scheduling and goal setting to stay on track.

  1. Reflect on what your financial analysis might reasonably look like in a year, taking into account income growth and inflation of consumer prices.
    1. What assumptions can you make about your income from your new position in a year’s time?
      1. What other sources of income might you have?
    2. How is inflation likely to impact your non-housing expenditures?
    3. How will your financial plan look depending on the situation with your new housing and your previous home?
    4. What other economic concepts will you take into account? How might they impact your financial analysis a year from now?

In a year, my financial analysis considers a slight increase in potential performance bonuses or an annual raise. Others could include income from rent or an interest-bearing bank account. Unanticipated inflation could lead to a rise in the non-housing outgo, which would cause a change in one’s discretionary outgo.

Depending on the shift in preferences, strategies in executing my housing plan—like selling the previous home or buying a new one, would affect the amount concerning economic factors such as movement interstate and certain market factors, in as much as they affect the return on investments, and the ability to fund future expenses. Altogether, all these factors continuously assess the main financial solvency and saving objectives.

References

Hayes, M. (2019, January 4). 5 types of budgets and how to make one that actually works for you. MarketWatch. https://www.marketwatch.com/story/5-types-of-budgets-and-how-to-make-one-that-actually-works-for-you-2019-01-03

Hill, C. (2018, December 17). This is the no. 1 reason Americans are so stressed out. MarketWatch. https://www.marketwatch.com/story/one-big-reason-americans-are-so-stressed-and-unhealthy-2018-10-1

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Question

Assessment 2 Developing a personal financial plan

Develop a personal financial plan in a scenario where you are moving to another city and must decide what to do with your current house, as well as your housing options in the new city. Complete a budget based on your decisions and projected new income, providing a rationale for your choices.

Introduction
Note: Assessment 3 builds on Assessment 2; you are strongly advised to complete Assessment 2 before beginning Assessment 3.

Planning for Peace of Mind
When #WithMyNextPaycheckIWill first began trending on Twitter, instead of the usual witty responses, most retweets lamented about the daily financial struggle of living paycheck to paycheck in the United States. The vicious cycle of working just to pay bills while never getting ahead is an effect of our economy and the rising cost of living. Yet there are financial planning measures you can use to help you take control of your finances and your future.

By learning how to build a financial plan, you will equip with yourself with a tool to help build your financial well-being. Understanding how to create a financial plan based on economic trends and your personal goals will make you more productive toward reaching those goals and help free you from the trap of endless financial stress. It’s impossible to plan for all of life’s challenges and surprises though, so you’ll need to use your agility skill to weather the uncertainties and adapt your plan so you can feel confident that you’re prepared for the future.

This assessment will help you practice your productivity skill through the use of planning and templates to increase efficiency—and your agility skill—as you practice responding to a sudden life change in the scenario.

Getting Started With a Financial Plan
As you begin assembling your financial plan in this course, here are some simple techniques to improve your productivity and reach your financial goals:

  • Track expenses and income.
    • If you want to see where your money is going rather than merely guessing, you can keep a daily record of all your financial transactions, including paychecks and bills. Following are some common third-party applications that professionals use to track their expenses. (Note:These tools are not specifically endorsed by Capella. Use of any of these tools is entirely at the user’s risk and may involve the transmission of personal information. If you are uncomfortable transmitting your personal information, do not use the tool.)
      • Mint: A budget management tool that syncs with your accounts to track spending.
      • PocketGuard: Gives you a snapshot of how much you can spend at any moment.
      • Clarity Money: Tracks your spending and online subscriptions.
      • Excel: Allows you to build, track, assess, and visualize budgets from the ground up.
  • Reduce your expenses.
    • Could you cut back on takeout lunches or negotiate a better data plan with your cell phone company? Once you start looking at how you’re spending, you’re bound to find ways to save. For instance, you may be able to receive a lower interest rate on your credit card simply by asking.
  • Consider your values.
    • To keep a balanced budget, you will need to make decisions around regular spending versus achieving your goals. One person may be fine cutting out their daily latte to add more to their weekly savings, but another person may really need that reward to keep them motivated. Once you have a sense of how the items in your financial plan rank in relation to each other, you can more effectively plan for your future.
  • Set financial goals.
    • Maybe you want to pay for additional education, a night out at a cool new restaurant, or a vacation to Mexico. Everyone has goals. The more specific your goals, the more focused and motivated you’ll be to achieve them by saving, paying off debt, and growing your funds.
  • Try the 50/20/30 rule to organize your income:
    • 50 percent for fixed expenses.
    • 20 percent for financial goals.
    • 30 percent for variable expenses (Hayes, 2019).

These simple techniques will not only bolster your personal financial plan, they’ll help you stay on track to achieving the future you want to earn.

Assessment 2 Word Template

Assessment 2 Word Template

Financial Planning for Peace of Mind
Financial uncertainty is the single greatest stressor in Americans’ lives. When you’re stressed, it’s hard to attend to your personal and professional goals because your mind is busy focusing on that stress. A financial plan can help you improve your overall well-being and eliminate stressors that get in the way of productivity. And there are daily practices you can also use to take control of the stressors in your life (Hill, 2018).

  • Exercise.
    • Getting your blood pumping at least 30 minutes each day will help your mental clarity and focus during work. It doesn’t have to be all at once, or even athletic: you can walk the dog or play with your kids.
  • Reward yourself.
    • We are motivated by rewards—even small ones. Find little ways to push yourself to stay productive, like treating yourself to a morning muffin.
  • Limit your online distractions.
    • It’s challenging not to get sucked into the latest posts or headlines when you’re trying to get work done. You can limit your Internet distractions by reducing how often you check your e-mail or social media posts.
  • Take short, strategic breaks.
    • Taking breaks every 90 minutes has been proven to keep your brain more relaxed and refreshed. Don’t break for too long though, or you may lose sight of what you were working on. A 10–15 minute break will keep you sharp.
  • Tap into your body’s rhythm.
    • Learning to ride your natural wave of energy throughout the day can help you stay productive. For many people, working on complex tasks early in the morning is best because they are more alert and focused.
  • Don’t ignore burnout.
    • Balancing your work and life is sometimes difficult to manage, but being honest with yourself and paying attention to your body can keep you from feeling stuck or getting sick. Here are some tips to avoid burnout:
      • Make sure you’re getting enough sleep.
      • Avoid foods that make you feel too tired or full.
      • Go outdoors at least once every day, even for five minutes.
      • Focus on what you’re passionate about.
      • Modify what you can to feel fulfilled, but don’t get hung up on things you can’t control.
  • Adopt an agile mindset.
    • All of the stresses and worries in our life can spin out of control, crowd our mind, and stifle our success. Protect your mental agility by worrying less about things you can’t control, asking questions when you need help, trying new things that push you outside of your comfort zone, and reducing negative self-talk. By staying mentally flexible, you’ll find it easier to adapt your mind to new circumstances and come up with unique solutions to problems.
      • You can discover further successful strategies for strengthening your agility skill in the Put Agility to Work media in the Resources.

By taking control of your personal well-being, you’re setting yourself up to stay productive at home, work, and school.

References

Note: Please be sure to complete Assessment 2 before beginning Assessment 3.

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