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CHAPTER 1 : INTRODUCTION (TIPS TO IMPROVE PERSONAL FINANCIAL PLANNING…
CHAPTER 1 : INTRODUCTION
Personal financial planning or personal finance is an individual or a person's fund or money management.
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Process of managing funds/money which belong to an individual or a person so that he/she can gain personal economic satisfaction.
Islamic Financial Planning stresses that the life goal of Muslims is to achieve Al-Falaah which is prosperity that leads a good life in this world and the hereafter, simultaneously satisfying our temporary needs and wants.
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FINANCIAL GOALS
goods and services to be consumed in the future , examples; children's education plan, marriage ceremony, buying a 2nd house or vacation.
kept funds or funds that are not used. Normally, deposited in bank account. Priority. At least 20% to 30% of our income should be set aside for savings every month. Helpful during retirement.
goods and services that we consume at present, examples are paying utilities bills, credit card payments, mortgage payments , paying for education and buying gifts. Can be divided into two which are low and high consumption. Higher income, higher consumption.
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Marginal cost is the cost of producing an additional unit. When the quantity of a product changes by one unit, the change in total cost is the marginal cost. It is also a basic concept of economics and finance.
Opportunity cost is a key concept in economics and finance as it expresses the relationship between scarcity and choice. When a consumer picks a product from among several choices, the cost related to the second best choice is the opportunity cost.
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