Question

Scenario: You are 30 years old and feel like you are getting nowhere with your financial goals. At the end of each month, you have a hard time understanding where all your money went. You have decided it is time to take a hard look at your current financial status. You currently have $80 of cash on hand, a checking account with a balance of $600, and a savings account containing $1,500. You own a small condo currently worth $120,000 with a mortgage on which you still owe $100,000, and on which you pay $600 per month. You own personal property (furniture, television, computer, etc.) worth $8,000. You have inherited Treasury bonds from your late aunt worth $12,000. You participate in a 401(k) retirement plan, now worth $30,000, in which you are 100% vested. You own a car originally valued at $28,000, now worth $12,000, on which you still owe $1,200, and make monthly payments of $250. Finally, you have credit card debt of $2,500 on which you pay a constant $125 per month. Developing a set of structured and deliberately formulated financial plans is very useful in achieving financial success and security. Which of the following actions would you recommend to someone thinking about engaging in financial planning? Recommend? Action If your employer offers a retirement plan, don't participate in it. Start saving early in life and save throughout your life. Don't bother to set target dates for achieving your financial goals.NoY Pay credit card balances in full each month (Yes or No) No Yes Yes

Answer 1

Action	Recommend (yes/no)
1-	Yes
2-	Yes
3-	No
4-	Yes
Which financial statement would provide the best answer	The balance sheet
Question	Answer
car	Tangible asset
credit card balance	short term debts
saving account	Investment asset
mortgage loan	long term debts
Treasury bonds	Investment asset
car at a value of 12000 and car payment should be recorded at 250
Personal balance sheet
total monetary assets	80+600+1500	2180
total tangible assets	120000+8000+12000	140000
total investment assets	12000+30000	42000
total assets		184180
Liabilities
short term debts		2500
long term debts	100000+1200	101200
total liabilities		103700
net worth		80480
total of liabilities and net worth		184180