Holiday Project to understand the best practices of financial planning for teenagers

1. Best Financial Planning
Practices For Teenagers

2. What is Financial Planning ?
Financial Planning is an ongoing process to help
you make sensible decisions about money that
can help you achieve your goals in life.

3. Managing money as a teen can be challenging.
Teens also have a hard time
saving for the future. so
setting aside some of their
spending money for the future
can be hard.

4. Budgeting Money
You need to learn how to budget your money as soon as you bring home
your first pay check.
Once you know your goals, think about what you need to do to get there and do some planning.
Don’t think, ‘My goal is to have fun.’ Think, ‘I’d like to
go out for pizza with my friend next Saturday.’

5. Needs VS Wants
know what your needs are and what
your wants are. Make a budget.
How much can you afford to spend?
Do you need everything now, or can you buy
something later?
where can you get the best deal for these items?

6. Consider All Costs
Before buying anything as a major
investment, first try and understand the
true cost of ownership.

7. Learn About Expenses
‘This is how much my parents have a month – and
then they pay for the mortgage, Television, food (etc.) –
and then this is what they have left over at the end.’

8. Making Money
Earning an allowance is nothing compared to
earning your very own dollars as you will know
about responsible money management.
Money is hard to earn and
they don’t grow on trees!
Entrepreneurial practice can help you get
comfortable with making and managing your cash.

9. Cutting Expenses
Everyone has expenses they can cut. Café
mochas at $3 each do add up. You can buy food at the
grocery store at cheaper
prices, take time to pack an
after-school snack, take
fewer trips to your favourite
coffee shop.

10. Wealth Foundation
________________________________________________
Wealth Protection
Teenage Financial Model
Wealth Accumulation
___________________________________
Wealth
Acceleration
___________________
 Emergency Fund
 Should have 6 to 12 months worth of
expenses
 Insurance plans
 Education ( university )
 Other expenses
 Investments, stocks & shares

11. Wealth Foundation
• Find out how much you spend each month.
• Estimate how much you will spend in 6 to 12 months.
• Save up for that amount of money by putting some money into your bank account
every month.

12. Wealth Protection
• Hospitalisation Plan – A health insurance plan providing coverage for
hospital confinement due to illness, accidents, intensive care of
convalescence.
• Critical illness plan – A Insurance product in which the insurer is contracted
to typically make a lump sum cash payment if the policyholder is diagnosed
with one of the specific illnesses on a predetermined list as part of an
insurance policy.

13. Wealth Protection
• Personal accident plan – An annual policy which provides compensation
in the event of injuries, disability or death caused solely by violent,
accidental, external and visible events
• Whole life plan – A life insurance contract with level premiums that has
both an insurance and an investment component. The insurance
component pays a stated amount upon death of the insured.

14. Wealth Accumulation
• AFTER having saved up 6 to 12 months worth of expenses, put money
every month into another bank account.
• This bank account will be for your university fees and other expenses such as
car repairs (if you have a car) ect.
• Endowment Plan – a life insurance contract designed to pay a lump sum
after a specific term or on death. They are often marketed to help you meet
your financial goal like paying for education, or to build up savings over a
fixed policy term.

15. Wealth Acceleration
• You can invest in stocks and shares to earn more money than in a savings bank
account.
• Put only a small portion of your money each month (the bigger portion should be
put in the savings bank account, refer to the previous slide) as it is risky and you
may lose instead of earn money.
• It is best to seek advice from an experienced adult.

16. Survey For Financial Planning
• 90% of teenagers asked have a part time job.
• 80% of teenagers asked put their money into their bank monthly.
• 50% of teenagers asked have insurance policies.
• 80% of teenagers asked have investments.
• 70% of teenagers asked think Financial Planning is for saving.

17. Conclusion
• Saving money is very important as it will help you reach your financial goals
and you will be able to get things you need and also buy some other extra
things that you want.
• Having insurance policies are also important because it can help protect you
when something bad happens.
• Putting money into your bank can help to eliminate the temptation of
spending that money.