Purpose

In this assignment you are to develop your own full financial plan, including addressing your real short, mid$-$term and long$-$term goals, as well as cover all six aspects of financial planning in detail, but concisely. The more relevant you make this for yourself, the more useful it will be$.$ You will need to project $($assume$)$ your income after graduation and base your cash flow and financial plans on that projection. Assume you will be working and retiring in Canada.

Structure

Introduction:

Describe who you are, age, single or married, number of children if any, current living situation

Describe your current employment situation AND talk about your career aspirations and projected gross annual salary based on that career

Four SMART Financial Goals:

All goals need to be specific, measurable, realistic, and include financial action steps and timing

You can reuse the same goals as the first assignment, or you can modify or change to different goals

One of the goals must be a retirement goal stated with all the SMART components $($this is separate from your retirement planning section$)$

Financial Statements:

Professional formatting that is not too small or blurry to read. Numbers must be rounded to the nearest dollar with no cents. All numbers are right aligned in one single column. Each statement cannot be split across multiple pages. Double check all your additions and subtractions!

CASH FLOW STATEMENT

Complete one future monthly $($not annual$)$ cash flow statement based on projected income and expenses after you start working in your career

BALANCE SHEET

This is a current snapshot of what you own and owe, NOT a projection!

Budget Reflection:

Reflect on your projected net cash flow and determine if it is sufficient to meet your stated financial goals

Strategies to reduce expenses

Is there enough emergency cash?

Credit Planning:

How you plan to pay off current or projected debts in the future like mortgage

Ways you can increase your credit score

Investment Planning:

State your investor risk profile

How to allocate your funds across different asset classes and types of investments $($diversification$)$

Your assumption for average annual investment return

Tax Planning:

Consider your marginal tax bracket based on your projected future income

Strategies to reduce taxes $($e$.$g$.$ deductions, tax credits, and registered plans etc.$)$

Insurance Planning:

Talk about your risk management strategies in property, health, life and disability insurance

Any existing coverage? Is it enough?

Reasonable rationale for not needing a particular insurance coverage

Retirement Planning:

Restate your retirement goal that includes assumptions about your age of retirement, investment rate of return, required annual retirement income $($need to consider inflation$),$ and life expectancy $($not shorter than $85$ years$)$

Calculate your total annual OAS, CPP$,$ and RRSP income during retirement and determine if you are on track to reach the goal $($show detailed calculations$)$

What can you do if you are not on track for the goal?

Estate Planning:

What you need to complete $($e$.$g$.$ will, POA, living will etc.$)$

Strategies to minimize probate fees and make sure you pass on assets efficiently

Deliverables

Your report should include charts, graphs, and other illustrations $($in addition to financial statements$)$ to enhance your plans. They should be relevant to illustrate the plan

Professional layout and headings are important to make your plan clear

Consistency throughout the plan is very important. For example, disposable income of $$5,000$ per month cannot fund various strategies that require $$10,000$ monthly cash flow

Plan should be written in paragraph form instead of point form

MAXIMUM six written pages $($illustrations$,$ financial statements, and appendices can be in addition$)$

Submit your report in one Word or PDF document on Blackboard by due date and time $($watch video tutorial to find the place of submission$)$

Late submissions will be deducted $10\%$ per day late, starting one minute after the due time