Risk Tolerance
	Personal Financial Plan
	Goals
	1. Determine whether to invest, given your current cash flows.
	2. Determine what kinds of investments you should purchase to meet your financial goals.
	3. Ensure that your current asset allocation is appropriate.
	4. Determine a plan for future allocation.
	Analysis
	1. Review your cash flow statement to determine how much you can afford to invest
	in stocks each month.
	Click here to review your personal cash flow statement
	2. Evaluate your risk tolerance to see if your temperament is suited to the
	uncertainty of investments.							.
								,
	Risk Tolerance Quiz
	Answer True or False by entering an x in the appropriate box. Be sure to
	enter an x for only one box (True or False) per answer, otherwise your
	results will be incorrect.
							TRUE	FALSE
	1. If I own stock, I will check its price at least daily if not more often.
							TRUE	FALSE
	2. When driving on a highway, and traffic and weather permit, I never
	drive in excess of the posted speed limit.
							TRUE	FALSE
	3. If the price of my stock declines, my first reaction is to sell.
							TRUE	FALSE
	4. Another stock market crash similar to 1929 could occur very unexpectedly.
							TRUE	FALSE
	5. When I fly in less than perfect weather, I tend to get nervous and concerned
	about my safety.
							TRUE	FALSE
	6. If I sold a stock at a loss of more than 25%, it would greatly shake my
	confidence in my ability to invest.
							TRUE	FALSE
	7. I intensely dislike blind dates.
							TRUE	FALSE
	8. When I travel, I write down a packing list to be sure that I don't forget
	anything.
							TRUE	FALSE
	9. When traveling with others, I prefer to do the driving.
							TRUE	FALSE
	10. Before buying a bond I would want to talk to at least two other people to
	confirm my choice.
							Score
	Comment
	You have the risk tolerance to invest.
	Results
	0-3 True: You have the risk tolerance to invest in individual common stocks.
	4-6 True: You would be a nervous investor, but with more knowledge and a few successes, you could
	probably raise your risk tolerance to a suitable level. Mutual funds might prove a good starting point for
	your level of risk tolerance.
	7-10 True: You are probably a very conservative and risk-intolerant investor who is probably better suited to
	a bond portfolio.
	3. Determine whether investments will help you to achieve your short-, medium-, and long-term goals.
	Complete the template below for the short-, medium-, and long-term goals that you have established
	and reviewed throughout the course. In determining whether investing is suitable for each goal,
	take into consideration the timeline for accomplishing the goal, the critical nature of the goal,
	and, of course, the results of your risk tolerance test. For those goals that you determine investments
	are not suitable, enter an "N" in column two, and do not complete the rest of the line for that goal.
	If, however, you enter a "Y" in column two, think about the kind of investment that is appropriate
	and justify your selection of stocks as a risk-appropriate means to accomplish this goal.
	Short-Term			SUITABLE ?	TYPE OF
	Goals			Yes or No	INVESTMENT	JUSTIFICATION
	Medium-Term			SUITABLE ?	TYPE OF
	Goals			Yes or No	INVESTMENT	JUSTIFICATION
	Long-Term			SUITABLE ?	TYPE OF
	Goals			Yes or No	INVESTMENT	JUSTIFICATION