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Unit 2 topic 7 - Coggle Diagram
Unit 2 topic 7
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getting married, going on holiday or retiring. But life
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of what happens is not planned. Indeed, some people
do not make any medium-term or long-term plans,
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change immediately and by the same amount as the change in Bank rate, but in time
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rises more slowly than prices, they suffer a fall in their real standard of living and
are not able to buy the same amount of goods and services. Since the credit crisis,
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Inflation is a special problem for those on fixed incomes, such as retired people living
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When a debtor is solvent again, it is important for them to rebuild their credit history
and, hopefully, they have learned from their negative experience. They need to adjust
their wants and aspirations to fit their income. Once they are able to borrow again,
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plan and their priorities when there are major changes. Some examples of life changing events that can cause financial problems are divorce, redundancy or illness. Being flexible means being willing and able to change priorities. A major negative
event forces people to do this. Plans that are laid down over a long time period are by nature less flexible than
shorter-term ones.
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not. If someone’s business is a limited company, it means that the liability of the
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assets to settle business debts. But if the business is not a limited company, for
example if it is a partnership or a sole trader, the owners can be required to use their
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needs to be brought into every financial plan so that, if an unfavourable event occurs,
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