LiBF Unit 2, Question and answers, 100% Accurate, rated A+
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LiBF
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LiBF
LiBF Unit 2, Question and answers, 100% Accurate, rated A+
1.1 Outline the need for financial planning. - -Make better financial decisions
Avoid unnecessary debt
Help make decisions on savings, spending and progress in reaching goals
Helps show what you have to do to get to where you want...
rated a 11 outline the need for financial planning make better financial decisions avoid unnecessary debt help make decisions on savings
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LiBF Unit 2, Question and answers,
100% Accurate, rated A+
1.1 Outline the need for financial planning. - ✔✔-Make better financial decisions
Avoid unnecessary debt
Help make decisions on savings, spending and progress in reaching goals
Helps show what you have to do to get to where you want to be
1.2 Explain the personal factors which influence financial planning. - ✔✔-Factors influenced by stage in
life cycle
Attitude to risk
Attitude to Risk - ✔✔-a. Risk tolerance - how does the individual feel about the possibility of losing
money?
b. Capacity for loss - how much money can the individual afford to lose?
Stages in life cycle - ✔✔-Childhood 0-12
Teenage 13-19
Young Adult 18-25
Mature Adult 26-40
Middle Age 41-54
Late Middle Age 55-65
Old Age 65+
Each of the stages has its own typical opportunities, challenges and needs.
1.3 Identify sources of financial planning information and advice. - ✔✔-Advisory services (CAB, Money
Advice Service, charities, financial advisers)
Financial service providers (banks, building societies, credit unions)
, Citizens Advice Bureau - ✔✔-Citizens Advice provides free, confidential and independent advice to help
people make the right choices, including help to deal with debt problems, how to avoid losing their
home and how to get their finances back into shape.
Money Advice Service - ✔✔-Free and impartial money advice, set up by government. Offers advice and
guides to help improve finances. Tools and calculators to help keep track and plan ahead. Support over
the phone and online
The Money Charity - ✔✔-empower people across the UK to build the skills, knowledge, attitudes and
behaviours, to make the most of their money throughout their lives
Financial Advisers - ✔✔-Independent financial advisers (IFAs) must recommend products and solutions
from the whole of the market
Restricted advisers can offer products from one
company or a limited number of companies
Short-term planning - ✔✔-a period of between one week and 12 months
Medium-term planning - ✔✔-a period of between one year and five years
Long-term planning - ✔✔-a period of five years or more
a need - ✔✔-something that we should - or must - have as part of our life e.g. food, shelter and clothes.
a want - ✔✔-something that a person would like or would aspire to, rather than something that they
absolutely need e.g. the latest smartphone
personal objectives - ✔✔-what the individual needs or wants
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