Choose 3 from reasons 5,6,7 & 8 and describe why these three are most important to you. Additionally, explain how you will incorporate these three reasons into your personal financial plan. Incorporate your knowledge of investments and compounding as well as some of Schor's principles for avoiding consumerism and unnecessary purchases.

PART | INTRODUCTION TO FINANCIAL PLANNING PART | INTRODUCTION TO FINANCIAL PLANNING Reason #5: To Pay for College financial decisions - and one you'll make The Cost of a 4-Year many times throughout your life. Should Guess what happens when the kids College Degree you pay cash, accept dealer financing, or use home equity? Is leasing right for you? turn 18? They go to college! 2010-2014 To learn the answer, go to Chapter 50. It's estimated that for a baby born Penn State* $159,525 in 2010, the cost of college in 2028 Maryland* $163,672 will exceed $250,000 for an in-state Berkeley* $144,584 Reason #8: To Buy a Home thomas school and over $500,000 for pri- Notre Dame $224,419 TR vate schools, according to the Americans devote the largest portion of their Harvard $227,480 College Board. To learn the proper incomes to housing. Consequently, how you Georgetown $216,439 "It's a question of priorities, Martha way to approach the cost of college, Do you want lots of kids or one with handle the purchase of your home will have $221,443 a college education? turn to Chapter 51. Princeton far-reaching implications on virtually every Yale $221,137 The Wall Street Journal, permission ndicate. facet of your financial life, including your Assumes 6% annual increase in the cost of tuition, ability to save, pay for college, and plan for room and board - based on 2009-2010 prices, your retirement. For this reason, I devote five chapters (56-60) exclusively to "Out-of-State tuition this subject, and it's referenced in many other chapters as well, including those dealing with debt elimination (Chapter 49), paying for college (Chapter 51), FIGURE 1-5 and the costs of raising children (Chapter 52). Reason #6: To Pay for a Reason #9: To Be Able to Retire When - and in the Style - You Want The Cost of Child's Wedding A Wedding Consider food. Assuming you and your spouse retire at 65 and live to your nor- Get ready for another major expense: The mal life expectancy of 83, you're going to eat 39,420 meals in retirement! (That's wedding! According to the wedding website three meals a day, 365 days a year over 18 years for two people.) If each of those Reception $12,838 TheKnot.com, the average cost is $28,385 meals costs five dollars, you'll spend $197,100 on food. Where will that money Rings $5,847 (excluding the honeymoon). Although par- come from? Photography/ $3,925 ents of the bride traditionally paid this Videography expense, increasing numbers of brides and Most people are ignorant of this message. Of today's retirees 65 and older, Miscellaneous $696 grooms - and parents of grooms - are 30% have incomes below $15,000 a year, according to the Social Security Wedding gown $1,134 paying for weddings. Administration. I'm not saying these people never earned more than $15,000 Music $1,343 a year while they were working. Rather, their income dropped below $15,000 Flowers/Decor $2,093 when they retired. Invitations $509 Reason #7: To Buy a Car Only 20% of retirees earn more than $50,000 a year. Yet the masses didn't plan Total $28,385 The average price of a new car is $28,082, to fail. They simply failed to plan, because under the old rules, planning wasn't according to the National Automobile necessary. It used to be that a worker and his family could be comfortable if he Dealers Association. Thus, that purchase retired at 62 on a pension and Social Security. That doesn't happen anymore. FIGURE 1-6 is one of your biggest and most confusing Today, you don't retire as young as 62 - unless you've been downsized out of 8