# FP 101 Entire Course

https://uopcourses.com/category/fp-101/

FP/101
FOUNDATIONS OF PERSONAL FINANCE

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https://uopcourses.com/category/fp-101/
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FP 101 Week 1 Personal Cash Flow Statement
Complete the Personal Cash Flow Statement.
Reflect on the money you have spent over the past month, and look back at less frequent expenses by reviewing your spending for the year.  Then enter the amount you pay and how frequently you pay it (select frequency from the drop-down). If you do not have any expenses for this category, skip it. If you have an expense but do not see a line for it, enter it in one of the rows labeled Additional Items. The Monthly Payment is the result of a calculation. If it seems incorrect, edit the \$ Amount or Frequency.
Submit your Personal Cash Flow Statement as a Microsoft® Excel® attachment to the Assignment Files tab.

FP 101 Week 2 Time Value of Money Worksheet
Complete the Time Value of Money Worksheet.
Use the Bankrate Compound Interest Calculator and input personal figures, changing the interest rate and the compounding of the interest rate.
Submit your Time Value of Money Worksheet as a Microsoft® Word® attachment to the Assignment Files tab.
Time Value of Money Worksheet

Refer to:  Ch. 1, “Time Value of Money” section of Personal Finance.

Respond to the following questions in 50 to 100 words each.

1.     What is the definition of Time Value of Money? Please define present and future value?

2.     How does compounding interest differ from present and future value?

For questions 3 – 5, use the Bankrate Compound Interest Calculator
http://www.bankrate.com/calculators/savings/compound-savings-calculator-tool.aspx and input provided figures, changing the interest rate, and the compounding of the interest rate (annually, semiannually, and quarterly) as delineated below:

3.     You place \$1,500 in a savings account earning 3% interest compounded annually. How much will you have at the end of four years? How much would you have at the end of four years if interest is compounded semiannually?

4.     Change the interest rate to a higher rate. How much will you have at the end of four years if interest is compounded annually at a rate of 5%? How much would you have at the end of four years if interest is compounded semiannually?

5.     Now change the interest rate to a lower rate. How much will you have at the end of four years if interest is compounded annually at a rate of 2.5%? How much would you have at the end of four years if interest is compounded semiannually?

Submit your responses in a Microsoft Word document.

FP 101 Week 2 Quiz
Complete the Week 2 Quiz provided by your facilitator.
Submit your Week 2 Quiz as a Microsoft® Word® attachment to the Assignment Files tab.
1. The stages that an individual goes through based on stages in the family and financial needs is called the
a.   Financial planning process
b.   Budgeting procedure
d.   Personal economic cycle

2.  The Rule of 72 is
a.    A tool to determine the number of years until retirement for an employee
b.   Used to estimate how long it takes for prices to double using a given annual inflation rate
c.   The legal code for requiring companies to provide a match on retirement savings
d.   Used to calculate interest rates for savings

3.  Which is NOT an influence in financial goals?
a.   Global influences
b.   Economic conditions
c.   Interest rates
d.   Financial intimacy with a partner

4.  Which is NOT an identifiable financial goal?
a.   Retirement and estate planning
b.   Risk management
c.   Living on a fixed income
d.   Saving

5.  Attempts to increase income are part of the __________ component of financial planning.
a.   Obtaining
b.   Planning
c.   Saving
d.   Spending

6.  SMART Goals contain all of the following except:
a.   Specific – knowing exactly what the goals are and how to attain them
b.   Action Oriented – the bases for the goals
c.   Manageable – to be able to understand the written goals
d.   Time based – the time frame needed to reach the goal

7.  Short-term goals are:
a.    Goals to be attained within a year or so
b.    Contain college plans for children
c.    Creating an estate plan
d.    Making a big purchase

8.  Long-term goals are:
a.   Goals to be attained within two years
b.   Uses short-term goals to attain certain goals in five or more years
c.   Create a Christmas fund
d.   Plan for summer vacation

9.  Which of the following intermediate goals is stated most clearly?
a.   Buy a car for less than \$17,000 within six months.
b.   Retire in ten years at age 65 with \$2,000,00 in my 401(k) account.
c.   Purchase a home with a mortgage no greater than \$150,000 within three years.
d.   Set up an emergency fund.

10.   Fran has a goal of “saving \$25 per month for a TV.” Fran’s goal lacks
a.   Measurable terms
b.   A realistic perspective
c.   A specific objective
d.   A time frame

11.  Opportunity cost can be defined as
a.   A trade-off of a decision
b.   Failing at goals
c.   Creating financial wisdom
d.   The amount paid for taxes when a purchase is made

12.   Which of the following is an example of opportunity cost?
a.   Renting an apartment near a school
b.   Saving money instead of taking a vacation
d.   Using a personal computer for financial planning

13.   To calculate the time value of money, we need to consider all of the following except the
a.   Amount of the savings
b.   Annual interest rate
c.   Length of time the money is invested
d.   Type of investment

14.   What is the correct formula for future value
a.   Time period X present interest rate
b.   Investment in savings X interest rate X period of time
c.   Time X interest
d.   None of these

15.   Which statement best explains the purpose of present value
a.    Calculating the cost of future investments
b.    Finding the current value for a future amount based on a certain interest rate and certain time frame
c.    Also known as discounting
d.    To reach an estimated guess

FP 101 Week 3 Credit History Worksheet
Complete the Credit History Worksheet.
Submit your assignment to the Assignment Files tab.
Credit History Worksheet

Directions

Identify the following factor descriptions to their corresponding C of credit. Highlight, bold, or underline the correct answer.

1. Jack and Jill want to buy a car. They are using another car for ___________ as a promise to pay.

a)     Capacity
b)     Capital
c)     Collateral
d)     Character
e)     Conditions

1. Under these _______________, you may still be approved with a cosigner.

a)     Capacity
b)     Capital
c)     Collateral
d)     Character
e)     Conditions

1. Henry has a history of not staying with a job for an extended period of time. Which of the C’s would a lender be looking at?

a)     Capacity
b)     Capital
c)     Collateral
d)     Character
e)     Conditions

1. Rex is seeking a student loan for graduate school. The lender will review which of the C’s?

a)     Capacity
b)     Capital
c)     Collateral
d)     Character
e)     Conditions

1. Madaline is a stay-at-home mom seeking to start a home-based business. She would need a cosigner in order to qualify for a loan. What other C’s might she need for this loan?

a)     Capacity
b)     Capital
c)     Collateral
d)     Character
e)     Conditions

1. Lenders use a debt-payment-to-income ratio to evaluate this particular C.

a)     Capacity
b)     Capital
c)     Collateral
d)     Character
e)     Conditions

Credit Score

Resources:

Directions

Note: You do not have to share your personal credit score or other details in this worksheet.

Using what you have learned about credits scores and the Five C’s, respond to the following in 50-to 100-words each:

1. When are the five C’s important?

1. Why is a credit score important?

1. What are the top 2 factors in your FICO score? What actions can you take to earn the most points in these categories?

Credit Reports

Directions

Go to www.annualcreditreport.com, the only site authorized by the Federal Trade Commission to provide free consumer credit reports. Request one free credit report from one of the three credit reporting agencies (if you are unable to download a report, complete this activity using a sample credit report from www.experian.com)

Using what you have learned about credits reports, respond to the following in 50-to 100-words each:

1. What type of information is included on your credit report?

1. What did you find surprising about credit reports?

FP 101 Week 3 Credit Protection and Identity Theft Worksheet
Complete the Credit Protection and Identity Theft Worksheet.
Submit your assignment to the Assignment Files tab.
Credit Protection and Identity Theft
Directions
Refer to two articles found at the Federal Trade Commission:

Fair Credit Reporting Act: http://www.consumer.ftc.gov/articles/0155-free-credit-reports

Avoiding Scams: http://www.consumer.ftc.gov/articles/0120-avoiding-scams-101

1. If you find errors on your credit report, what steps would you take to correct them?

1. There are many organizations that claim they will repair your credit for a fee. From your readings, should someone use a credit repair service? Why or why not? What are some actions these organizations can take that should be a red flag?

1. Have you, a family member, or a friend been a victim of identity theft?  How did it happen? Describe the resolution process- ex. how much time did it take, what credit damage was corrected?

1. Using the FTC site, what can you do to minimize the chance of your identity getting stolen?

Post the Credit Protection and Identity Theft worksheet as a Microsoft® Word attachment.

FP 101 Week 3 Quiz
Complete the Week 3 Quiz provided by your facilitator.
Submit your Week 3 Quiz as a Microsoft® Word®attachment to the Assignment Files tab.

FP 101 Week 4 Education Funding Worksheet
Resources:

Read the Education Funding Worksheet instructions.
Complete the Education Funding Worksheet in Microsoft® Excel®.  Responses will include numbers and text to respond to questions.
Submit your assignment to the Assignment Files tab.

FP 101 Week 4 Quiz
Complete the Week 4 Quiz provided by your instructor.
Submit your Week 4 Quiz as a Microsoft® Word®attachment to the Assignment Files tab.

FP 101 Week 5 Buying Major Assets Worksheet
Complete the Buying Major Financial Assets Worksheet.
Submit your assignment to the Assignment Files tab.

1.     Complete the “Buy or Rent” calculator using your own data. In 50-100 words answer the following: What was the recommendation? What were the factors that led to that recommendation? Do you agree or disagree with the recommendation?  Why?

2.     In a minimum of 100 words, explain the main benefits and drawback of renting and of owning a home?

3.     Review Exhibit 7-4.  In at least 100 words, summarize the steps in the home-buying process.

4.     Review Exhibit 7-6. Estimate the affordable monthly mortgage payment, the affordable mortgage amount, and the affordable home purchase price for the following situation.
· Monthly gross income: \$2,950
· Other debt, monthly payment: \$160
· Down payment to be made: 15% of purchase price
· Monthly property tax and insurance: \$210
· 30 year mortgage at 6%

Enter your calculation and response in this column

Step 1. Determine the monthly gross income (annual income divided by 12).

Step 2. Multiply step 1 by 33% for a PITI (principal, interest, taxes, and insurance) guideline.
NOTE: With a down payment of at least 5%  lenders use 33% of the gross income as a guide for PITI (principal, interest, taxes, and insurance)

Step 3. Subtract other debt payments from the result of Step 2 to determine the Affordable Monthly Mortgage Payment.

Step 4. Divide the result of Step 3 by 6.00 (this is the mortgage payment factor from Exhibit 7-7 based on a 30 year loan at 6%) and then multiply this by \$1,000. This is the Affordable Mortgage Amount.

Step 5. Divide the affordable mortgage amount by .85 (This is 1 minus the down payment percentage) to determine the Affordable Home Purchase.

1.     Review Exhibit 6-2.  In at least 100 words, summarize the steps in the car-buying process.
2.     Using the framework on page 199, prepare a financial comparison of buying and leasing a car with a cash price of \$24,000.  Show your calculations.
· Down payment (to buy/finance): \$4,000
· Monthly loan payment: \$560
· 48 month loan and lease
· Value of vehicle at end of loan: \$7,200
Instruction:  Complete the chart below to calculate the cost of buying a car.

Steps to Buying a Car taken from “Figure it Out” on page 199

Enter your calculation and response in this column

Step 1. Total down payment

Step 2.  Total cost of payments: Multiply the Monthly Loan Payment by the Length of the Loan

Step 3. Identify the opportunity cost of the security deposit: Multiply the Security deposit by the Length of the Loan by 3%

Step 4.  Add the result of Step 1, 2 and 3.

Step 5. To determine the total cost of buying subtract the Value of the vehicle at the end of the loan from the result of Step 4.

Instruction:  Complete the chart below to calculate the cost of leasing a car.
· Security deposit (to lease): \$1,200
· Monthly lease payment: \$440
· 48 month loan and lease
· End-of-lease charges: \$600

Steps to Leasing a Car taken from “Figure it Out” on page 199

Enter your calculation and response in this column

Step 1. Multiply the Monthly Lease Payment by the Length of the Lease

Step 2. Identify the opportunity cost of the security deposit: Multiply the Security deposit by the Length of the Lease by 3%

Step 3. To determine the total cost of leasing add the results of Step 1 and 2 to the End-of-Lease Charges

FP 101 Week 5 Quiz
Complete the Week 5 Quiz provided by your facilitator.
Submit your Week 5 Quiz as a Microsoft® Word®attachment to the Assignment Files tab.
Week 5
1.  Before taking out a loan, you should ask yourself whether you can meet all your essential expenses and still afford the monthly loan payments. This can be determined by
a.   Adding up basic monthly expenses then subtracting this total from gross pay
b.   Asking what you plan to give up to make the monthly loan payment
c.   Multiplying your take-home pay by 50% and subtracting your current loan payments
d.   Adding up basic monthly expenses, subtracting this total from take-home pay and, if needed, figuring out what to give up to make the payment

2.  The text identifies several phases in the buying process. The correct order of the phases is
a.   Evaluating alternatives, pre-shopping activities, selection and purchase, post-purchase activities
b.   Pre-shopping activities, selection and purchase, evaluating alternatives, post-purchase activities
c.   Pre-shopping activities, evaluating alternatives, selection and purchase, post-purchase activities
d.   Evaluating alternatives, selection and purchase, pre-shopping activities, post-purchase activities

3.  Information gathering is part of the ________________ phase of the decision-making process.
a.   Evaluating alternatives
b.   Pre-shopping activities
c.   Selection and purchase
d.   Ordering activities

4.  The dealer’s cost is also known as
a. Invoice price
b. Sticker price
c. Set price
d.Capitalized cost

5.  A potential problem with having a long car loan is
a.   Low monthly payments
b.   Low-interest loan
c.   Negative equity
d.   Loan preapproval

6.  All of the following are fixed operating costs for a vehicle except
a.   Insurance
b.   Interest on an auto loan
d.   Maintenance and repairs

7.  Which of the following is NOT correct?
a.   Renting is usually less expensive in the short run.
b.   Home ownership usually has long-term financial advantages.
c.   Lifestyle and financial factors should be analyzed to determine if you should rent or buy.

8.  Which of the following is a disadvantage of renting?
a.   Renters have fewer responsibilities than home owners.
b.   Tenants cannot take tax deductions for mortgage interest and property tax.
c.   Renters usually do not have to be concerned with maintenance and repairs.
d.   Taking possession of a rental unit is less expensive than buying a home.

9.  What should a home buyer consider when evaluating a house?
a.   Zoning laws
b.   School system
c.   Property values of the community
d.   All of these should be evaluated.

10. Trenton wants to buy a house but can provide only a 10% down payment. He probably will be required to have
a.   Amortization
b.   Escrow
c.   Points
d.   Private mortgage insurance

FP 101 Week 6 Investments Worksheet
Complete the University of Phoenix Material: Investments Worksheet.
Submit your assignment to the Assignment Files tab.
Investments Worksheet

Answer the following questions in at least 50 words each:

1.     What are the main differences between a 401K and a Roth IRA?

2.     How would you explain the difference between a stock, a bond, and a mutual fund?

3.     What are the risks and rewards of investing?

4.     How can you minimize the risks associated with investing?

5.     What would affect your decision to invest?

FP 101 Week 6 Quiz
Complete the Week 6 Quiz provided by your facilitator.
Submit your Week 6 Quiz as a Microsoft® Word®attachment to the Assignment Files tab.
Week 6

1.      Which of the following steps is NOT a factor to be considered before making your first investment?
a.   Work to balance your budget.
b.   Manage your credit card debt.
c.   Save at least \$10,000 to invest.
d.   Start an emergency fund.

2.      As people approach retirement, which of the following holds true for most?
a.   Their choices of investments do not change.
b.   They choose more conservative investments.
c.   They choose more risky investments.
d.   They move all their money into certificates of deposit.

3.      When choosing an investment, you should consider risk. The four primary risk components are
b.   Buying power, inflation, interest rate, market
c.   Inflation, interest rate, business failure, market
d.   Market, bond, stock, inflation

4.     The process of spreading your assets among several different types of investments to lessen risk is called
a.   Asset allocation
b.   Asset combination
c.   Asset investments
d.   Asset returns

5.      If you need access to your funds in two years or less, which of the following investments would be least appropriate?
a.   Cash
b.   Certificates of deposit
c.   Short-term government bonds
d.   Stocks and mutual funds

6.     Some financial experts suggest that investors include a percentage of growth investments as part of their portfolio. This can be calculated by subtracting your age from
a.   90
b.   100
c.   110
d.   120

7.      Timothy has \$100 automatically invested in stock each month. This way, he does not buy high and sell low. He is using a
b.   Direct investment plan
c.   Direct reinvestment plan
d.   Dollar cost averaging technique

8.     What happens to the price of bonds when interest rates go up?
a.   It goes down.
b.   It goes up.
c.   Nothing. Bond prices are unaffected by fluctuations in interest rates.
d.   It stays the same. Bond prices are determined by the market dynamics of buying and selling.

9.      Since 1926, the average annual return for stocks has been about
a.   8%
b.   10%
c.   12%
d.   14%

10.    Which of the following is a fund that invests in stocks or securities contained in specific stock or securities index?
a.   Closed-end fund
d.   Open-end fund

a.   May allow investors to pay a sales charge
b.   Charges commission when you buy shares
c.   Can charge a fee of up to 0.25% of its assets
d.   Is available only via the Internet

12.   Which of the following types of stock funds invests in the same companies included in the Standard & Poor’s 500 stock index?
a.   Equity income funds
b.   Growth funds
c.   Index funds
d.   International funds

13.   An example of a lifecycle fund is a fund that
a.   Assists investors with planning for retirement by a specific date
b.   Initially invests in conservative securities, then changes to invest in more risk-oriented securities as time goes by
c.   Invests in shares of other mutual funds in order to increase diversification and asset allocation
d.   Has principal protection as its main objective

14.   At what age are you are required to begin withdrawing money from non-Roth IRA’s?
a.   At age 70 ½
b.   Never – You can die without ever having withdrawn a penny from it and pass it income-tax free to your heirs.
c.   When you begin receiving Social Security payments
d.   At age 59 1/2

15.   Money in a 401(k) grows in what way
a.   Tax-free
b.   Tax-exempt
c.   Tax-deferred
d.   Taxable

FP 101 Week 7 Retirement Planning Worksheet
Complete the Retirement Planning Worksheet
Submit your assignment to the Assignment Files tab.
Retirement Planning Worksheet

Step 1Estimate your retirement income at:
http://www.bankrate.com/calculators/retirement/retirement-plan-income-calculator.aspx
You will be asked to answer six questions.  If you are unsure of what the fields are, the definitions are below on the same page.  There are some assumptions about how much your investments will earn, inflation rates, and tax rate; you can edit these to see how they impact the calculation.
· Based on your inputs, what is your estimated monthly retirement income before tax/inflation?

· Based on your inputs, what is your estimated monthly retirement income after tax/inflation?

Step 2:  Determine how your current retirement strategy will provide for retirement income:
http://www.bankrate.com/calculators/retirement/retirement-plan-calculator.aspx
You will be asked to answer eight questions.  If you are unsure of what the fields are, the definitions are below on the same page.  There are some assumptions about how much your investments will earn, inflation rates, and if Social Security income is considered; you can edit these to see how they impact the calculation.
· Based on your inputs, how much monthly income is your current strategy estimated to provide?

· Assume that monthly income will not be sufficient.  In at least 100 words, what steps can you take now and/or in retirement to live comfortably in retirement?

Step 3:   Calculate how savings can grow
How long will it take you to reach \$1 million in savings?   Answer the four questions in this calculator to calculate when you could become a millionaire: http://www.igrad.com/schools/universityofphoenix/?TargetURL=%2FResources%2Fmillionaire-calculator
· How many years will it be before you reach \$1 million in savings?

· Thinking of what your life might be like in retirement, would \$1 million be sufficient to support yourself? (Some things to consider would be your health, where you live, and how much money you owe.)  In at least 100 words explain why or why not?

FP 101 Week 7 Quiz
Complete the Week 7 Quiz provided by your facilitator.
Submit your Week 7 Quiz as a Microsoft® Word®attachment to the Assignment Files tab.
Week Seven
1.      If you start a new job and are offered the opportunity to participate in the company’s 401(k) or 403(b) retirement plan, which of the following decisions can affect your financial future?
a.   Participating in the retirement account to reduce income taxes
b.   Participating in the retirement account to take advantage of the employer’s matching contributions
c.   Basing your actual choice of investments on your age, how long before you retire, and your tolerance for risk
d.   All of these decisions would have a financial impact.

2.      When thinking about retirement, which of the following is most accurate?
a.   You’ll spend less when you retire.
b.   Saving just a little bit won’t help.
c.   You can depend on Social Security and a company pension plan to pay your basic living expenses.
d.   The earlier you start saving, the better.

3.      When planning for retirement
a.   A mortgage should not affect your financial planning.
b.   Investments should be evaluated to determine whether their income can help cover living expenses.
c.   Keeping your current, large house will be cheaper to maintain than to move to a smaller house.
d.   Life insurance should be avoided.

4.      When planning for retirement, inflation
a.   Decreases through retirement
b.   Can be ignored since it will have little effect on retirement funding
c.   Should be considered since income received earlier in retirement will buy more than the same amount received later in retirement
d.   Should be recognized since it will increase the value of income received in retirement

5.      Employees who were born in 1960 or later can receive full Social Security benefits beginning at what age?
a.   59 ½
b.   62
c.   67
d.   70

6.      Jacob is updating his estate planning and wants to set up the legal document to leave everything to his wife. He is writing a(n)
a.   Guardian will
b.   Simple will
c.   Stated amount will

7.      Intestate is
a.   The process of validating a will
b.   A written will
c.   A type of trust
d.   Dying without a valid will

8.      A legal arrangement that helps manage the assets of your estate for your benefit or that of your beneficiaries is called a
a.   Formal will
b.   Trust
c.   Guardian
d.   Holographic will

9.      A(n) ______________ allows you to end the trust or change its terms during your lifetime.
a.   Living will
b.   Power of attorney
c.   Revocable trust
d.   Will

10.    What is the difference between a will and a living will?
a.   A will is used to distribute your property after your death; a living will allows you to specify, in writing, your health care preferences for the time when you no longer have the capacity to provide consent.
b.   A living will terminates if you become incompetent, while a will continues in force even if you become incapacitated.
c.   A will describes your preferences regarding treatment if you are faced with a serious accident or illness; a living will specifies what physicians are allowed to treat you.
d.   A living will appoints someone to act on your behalf in financial or medical matters; a will specifies how your assets will be distributed on your death.

FP 101 Week 8 Insurance Worksheet
Complete the Insurance Worksheet.
Submit your assignment to the Assignment Files tab.
Insurance Worksheet

Directions:
Match the following word with the correct definition.

1. Premium                                               A.  The set amount that a policyholder must pay per loss on an insured policy

1. Deductible                                                      B.    A flat fee that a policyholder must pay for each received service

1. Copayment                                                    C.    The protection provided by the terms of an insurance policy

1. Coverage                                                       D.    The amount of money a policyholder is charged for an insurance policy

Directions:

For each type of insurance listed, explain in at least 50 or more words coverage characteristics provided.

Type of Insurance

Description of Coverage

Auto

Bodily Injury Coverage

Property Damage Coverage

Car Rental

Discounts

Home and Property

Replacement value of home

Actual Cash Value

Liability Coverage

Location influences

Discounts

Health

Health Maintenance Organization (HMO)

Preferred Provider Organization (PPO)

Point-of-Service Plan (POS)

Health Care Accounts

Medicare

Medicaid

Long-term Care

Disability

Short-term

Long-term

Social Security

Workmen’s Compensation

Life

Term Life

Whole Life

Universal

FP 101 Week 8 Quiz
Complete the Week 8 Quiz provided by your facilitator.
Submit your Week 8 Quiz as a Microsoft® Word®attachment to the Assignment Files tab.
Week 8
1.     Homeowner’s insurance covers all of the following except
a.   Personal property
b.   Personal liability
d.   Automobiles

2.     Which of the following is not correct about renter’s insurance?
a.   The broad form covers personal property against perils specified in the policy.
b.   Renter’s insurance covers the building and other structures on the site.
c.   Typical coverage pays only the actual cash value of one’s losses.
d.   Renter’s insurance includes personal property protection, additional living expenses, and personal liability.

3.     When purchasing homeowner's insurance, if you want a policy that does not consider depreciation, you should look for a policy that
a.   Will cover the actual cash value of your house and possessions
b.   Will cover two times the actual cash value of your house and possessions
c.   Will cover the replacement value of your house and possessions
d.   Does not adjust your coverage based on inflation, since this could end up costing you more in annual premiums

4.      Which of the following best defines “actual cash value” in a home or renter’s insurance policy?
a.   Insurance that pays the replacement value of damaged or stolen
b.   Insurance that pays for additional living expense coverage
c.   Insurance that pays the depreciated value of damaged or stolen property
d.   Insurance that pays for the items included in a “rider”

5.     Motor vehicle coverage typically includes all of the following except
a.   Most legal expenses
b.   Bodily injury liability up to a specified level for all injured in an accident
c.   Medical payments up to the policy limit
d.   Bodily injury liability of all expenses, no matter the cost, for the most injured

6.      Tim was driving his friend Nick to football practice. While driving, he was hit by a driver who had coverage of 100/300/50. Tim and Nick each suffered some physical injuries. Based on this information, which of the following is correct?
a.   Tim’s injuries would be covered \$100 and property damage would be limited to \$300.
b.   Nick’s injuries would be covered to \$50,000.
c.   The policy would provide a maximum of \$100,000 for each of the injured, and no more than \$300,000 for total injuries sustained in the accident.
d.   Tim and Nick’s injuries would be covered to \$300,000 each.

7.      Patrick has an old beater car and wants to keep his insurance costs down. In order to minimize the financial impact of an accident he may cause, he should, at a minimum, carry which type of insurance?
a.   Property damage liability
b.   Collision
c.   Comprehensive physical damage
d.   All of these are required for all vehicles

8.      The set amount that you must pay toward medical expenses before he insurance company pays benefits is called
a.   Reimbursement
b.   Out-of-pocket limit
c.   Deductible
d.   Internal limit

9.      Georgia has a health insurance policy that includes a deductible of \$600 and a coinsurance of 20%. If her total bill is \$4,000, how much will she be required to pay?
a.   \$400
b.   \$600
c.   \$1,280
d.   \$3,400

10.    Cameron, age 25, sustained a debilitating injury and was unable to perform his job for 45 days. His employer had a disability income insurance policy that pays 70% of take-home pay with an elimination period of 60 days and coverage up to age 65. Given this information, which of the following is true for Cameron?
a.   He will receive disability income for 15 days.
b.   He will receive disability income for 45 days.
c.   He will receive disability income for 60 days.
d.   He will not be eligible for any disability income because his disability ended before the elimination period ended.

11.    What is a function of disability insurance?
a.   Covers medical costs incurred by an insured and their family
b.   Part B covers medical costs for you and passengers of your insured vehicle, if you are at fault.
c.   Provides income replacement to individuals who are unable to work as a result of illness or accident
d.   Covers against the risk that personal property will be stolen or damaged by others

12.    Most people buy life insurance to
a.   Pay off a mortgage
b.   Protect the people who depend on the insured from financial losses caused by his or her death
c.   Pay for a vacation
d.   Pay taxes

13.   Judy and James have a 4-year old child. They plan to purchase a life insurance using this formula: Current income X 7 X 70%. Which method are they using to determine their life insurance needs?
a.   Easy method
b.   Formal calculation method
c.   Nonworking spouse method
d.   Family needs method

14.    If you want to purchase tem insurance, you will receive all of the following except
a.   Protection against loss of life for a specified term
b.   Cash value
c.   Temporary insurance
d.   A benefit during the period it covers, such as 1,5,10, or 20 years

15.    Of the following, which one is the most positive feature of whole life insurance?
a.   You must pay interest on the policy
b.   You pay premiums each year for the rest of your life
c.   It builds cash value
d.   It is permanent life insurance

FP 101 Week 9 Final Summary: Putting it All Together
We covered many important topics during this class. Understanding spending and income, cutting expenses, saving and investing money, building an emergency fund, improving credit, getting out of debt, protecting your assets, and setting financial goals are just some of those topics. These concepts will aid your continued personal financial planning for the rest of your life.
Submit a 350- to 700-word summary addressing the following questions:

• How would you explain the value of financial planning to friends or family?

• Which topics will you discuss with children in your life?

• Which topics do you feel are most important for adults to fully understand? Explain why you chose these topics.

• What financial goals have you set for yourself? How will you meet them?  Explain what steps you will take to begin saving toward these goals.

Submit your assignment to the Assignment Files tab.

FP 101 Week 9 Understanding Taxes Worksheet
Resource: Taxes. This assignment will use tax example forms and have correlating questions for each form.  Please follow the directions contained within the worksheet.
Complete the Understanding Taxes Worksheet.
Submit the completed Understanding Taxes Worksheet as a Microsoft® Word®attachment to the Assignment Files tab.
Understanding Taxes Worksheet

Resources: The United Stated Internal Revenue Service at www.IRS.gov

Directions: Use the links provided for each tax form to answer the correlating questions in 50- to 150-word responses.  You will be using forms and example forms to answer the questions below.

Understanding the 1040 Form

Visit 1040A  Form at http://www.irs.gov/pub/irs-pdf/f1040a.pdf

1. Compare and contrast the 1040, 1040A, and 1040EZ form. Which form would a single student use? If the student was married with children, which form would most likey be used?

1. If a person is single and head of household, why would he or she be able to file “head of household”?

Are there any benefits from filing as head of household, rather than single?

1. Define capital gains. What impact can this have on a refund or payment of taxes?

1. What is an adjusted gross income? Which line on the tax form is total income located?

1. What lines would student loan interest deductions and tuition and fees be located on the 1040A form?  What form is used to help  with a student’s tution and fees?

1. Explain what is a tax credit and tax deduction.

1. When would a person use a third party designess?

Visit W-2 Wage and Tax Form at http://www.irs.gov/pub/irs-pdf/fw2.pdf.

1.  What is primary purpose of the W-2 Wage and Tax Forms?

1. When does a taxpayer receive the W-2? Who will provide this form to the taxpayer?

1. What items on the W-2 make up Federal Insurance Contributions Act or FICA?

11.  What form should accompany the W-2 for Child and Dependent Care Expense?

1. What is the date that taxes are due? If you need an extenstion what form would you use? How long is the extension? Are there any penalties for requesting an extension?

FP 101 Week 9 Final Exam
Complete the Final Exam provided by your facilitator.
Submit your Comprehensive Final Exam as a Microsoft® Word®attachment to the Assignment Files tab.

Week Nine
Athena wants to determine if she should itemize her deductions. She has identified several possible deductions. Which of the following is NOT a proper deduction?
a.   Contributions to charity organizations
b.   Medical and dental expenses that exceed 7.5% of AGI
c.   State interest rate
d.   Miscellaneous expenses less than 2% of AGI

1.     Fred has been completing his own tax return for many years. The IRS has recently contacted him with questions about some of his prior returns. How many years back is he responsible for providing documentation?
a.   Until he files his returns
b.   3 years
c.   6 years
d.   10 years

2.     The form you file with your employer to determine how much income tax is withheld from your check is
a.   W-2
b.   W-4
c.   1098-E
d.   1099

3.     The Federal Insurance Contributions Act (FICA) created this payroll deduction for federal government retirement benefits (such as old age, survivor, and disability insurance)
a.   Estate taxes
b.   Excise taxes
c.   Social Security taxes
d.   Sales taxes

5.  All of the following can reduce your taxes today except investing in
b.   Section 529 savings plan contributions
c.   401(k) plan contributions
d.   Roth IRA contributions

6.     Gross income after certain reductions have been made is
b.   Earned income
c.   Exclusions from income
d.   Tax-deferred income

7.      Flat taxes are:
a.   Available to everyone not income based
b.   The higher income the higher interest rate
c.   Must be paid in full
d.   None of these

8.     This type of deduction represents the set amount of income on which no taxes are paid
a.   Exemption
b.   Itemized deduction
c.   Standard deduction
d.   Tax deduction

9.     At the end of the year, employees receive a ________ form that reports annual earnings and the amounts deducted for taxes from their employers.
a.   1040
b.   1099
c.   W-2
d.   W-4

10.   Nancy is married to Jerry and needs to complete her tax form. They both earn about the same amount of money each year. What filing status would be best for them?
a.   Single
b.   Married, filing a joint return
c.   Married, filing individually

11. A family with \$50,000 in assets and \$30,000 of liabilities would have a net worth of
a.   \$10,000
b.   \$20,000
c.   \$50,000
d.   \$80,000

12.  Opportunity cost can be defined as
e.   A trade-off of a decision
f.    Failing at goals
g.   Creating financial wisdom
h.   The amount paid for taxes when a purchase is made

13. If you think your identity has been stolen, which of the following actions does the Federal Trade Commission recommend you take immediately?
e.   Call 911.
g.   File a police report.
h.   All of these steps should be taken immediately.

14. Many think that perhaps the greatest disadvantage of using credit is
a.   The temptation to overspend
b.   The convenience offered instead of using cash
c.   The float from using credit
d.   The increase in total purchasing power

15. Which of the following electronically subtracts money from your savings or checking account to pay for goods and services?
a.   A credit card
b.   Closed-end credit
c.   A debit card

16. Information gathering is part of the ________________ phase of the decision-making process.
e.   Evaluating alternatives
f.    Pre-shopping activities
g.   Selection and purchase
h.   Ordering activities

17. A valid long-term investment goal is
a.   Saving \$5,000 per year for 40 years for retirement
b.   Spending less than \$500 per month for housing
c.   Accumulating \$3,000 in a savings account over the next 18 months
d.   Using credit cards less in the next six months

18. A valid short-term investment goal is
a.   Saving \$5,000 per year for 40 years of retirement
b.   Spending less than \$500 per month for housing
c.   Accumulating \$3,000 in a savings account over the next 12 months
d.   Using credit cards less in the next six months

19. If you start a new job and are offered the opportunity to participate in the company’s 401(k) or 403(b) retirement plan, which of the following decisions can affect your financial future?
e.   Participating in the retirement account to reduce income taxes
f.    Participating in the retirement account to take advantage of the employer’s matching contributions
g.   Basing your actual choice of investments on your age, how long before you retire, and your tolerance for risk
h.   All of these decisions would have a financial impact.

20. What is the fee that a policyholder pays when an insurance company agrees to take on the risk?
a.   Coverage
b.   Insured