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FINANCIAL NEEDS ANALYSIS (Factors of need (Family background, Level of…
FINANCIAL NEEDS ANALYSIS
Factors of need
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Islamic
- Dharuriyat (essential)- the basic needs of an individual or items that are absolutely necessary for one to protect the religion,life,knowledge & ownership
- Haijyat (supplementary)- the additional things that supplement the essentials that will improve the qulity of life of a person & if the need are not met it will not cause total disruption of life.
- Tahsiniyah (embelishment)- the added extras that provide further benefits that flourishes the quality of life such as the luxury goods.
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Personal Balance Sheet
Assets
- There are tangible & intangible
- Liquid assets : Can be converted into cash within a short period of time and with minimal loss in value.
- Financial assets : Intangible assets kept for generating returns
- Real properties : Tangible assets with long life spans & high cost
- Personal properties : Tangible assets that provide comforts of life
Liabilities - Money owe to individual/ financial institutions that require repayment.
Current liabilities/short term liabilities (one year from now) - credit card balances, utility bills, taxes payable & insurance premiums.
Tenure liabilities/long term liabilities (exceed one year) -Housing loan & car loan
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Financial ratio analysis
-Objectives:
- To identify strength & weakness of the financial condition of a person
- To identify the specific area that needs to be rectified for a better financial condition.
- To provide a warning signals to the individual on his finance condition.
Solvency ratio - To measure the capacity to settle debt/ the chances that financial condition is deteriorating / going toward bankruptcy.
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Debt service ratio - To measure the ability to pay off loan repayment timely.it indicate chances of non payment.
Gearing ratio - To measure the level of debt to finance the assets owned ( to what extend you borrow to acquire assets)
Personal Budget
- Objectives
- To live within the income
- To keep aside savings
- To spend wisely
- To prepare for financial urgent needs
- To achieve financial goals
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Al- Rahnu: An Islamic approach of financing by getting advances based on value of valuable items surrended for specific purpose.
Features :
- Loan amount can be up to RM5000 per day & collectively up to RM25000/RM50000 depending the provision given to the operator.
- Margin of loan financing: The financing amount received by the borrower is between 60% to 75% of the value of gold
- Safekeeping fees - between 40 sen to 60 sen for every RM100 depending on value of gold & service fee of 50 per transaction
- Loan repayment method - lump sum/ installment amount and by cash/cheque
Shariah concept
- Qardul Hasan ( benevolent loan)
- Wadiah yad-damanah
-Al ujrah (safekeeping fee)
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