Personal Finance 101: Take Control of Your Finance

Welcome to the course Personal Finance 101: Take Control of Your Finance.

In this course we will focus on Cash Flow & Budgeting, Investment & Debt Management, Insurance & Risk Management, and Retirement Planning from a personal finance perspective.

Here are the topics we will cover in section 1.

• Gross Income vs Net Income - what are the deductions and how to estimate net pay based on your job offer and location.

• Budgeting strategy – how to categorize and track expenses - useful tool that will help categorize every dollar you spend

• MoSCoW Framework - hands on tool to visualize your expense, categorized

• Importance of Autopiloting Expenses & Paying Yourself First - make life easy while saving up more for future

• Net Worth - How to compute your net worth

• Financial Growth Flywheel - how to grow your net worth by making simple tweaks and spinning the flywheel

• Lifestyle Inflation - what is it and how to avoid it.

• Key takeaways from the course summarized

By the end of this section, you will have a framework to analyze your expenses, and a strategy to increase your net worth.

Here are the topics we will cover in section 2.

• Inflation vs Investment - why investment is almost essential to avoid losing monetary value

• Importance of investing with a long term horizon

• Magic of Compounding and Rule of 72

• Where can you invest?

• Introduction to Stocks

• Stock Price vs Market Cap - why market cap is more important that stock price itself.

• Introduction to ETFs

• Stock Picking vs Investing in ETFs

• Alternative Investing - investing options beyond stocks of companies

• Importance of Portfolio Diversification - how diversification helps get better return to risk ratio

• Some Tips for beginners in investment

• How to slay the debt dragon - strategies to pay off loan faster

• Which loan gets the extra dollar - highest interest or lowest monthly payment one? There's ONE right answer.

By the end of this section, you will have a sound understanding of your investment options, and clarity on how to attack and strategically payoff your debts faster.

Here are the topics we will cover in section 3.

• Introduction to Insurance

• Where and How you can buy insurance

• What is Insurance Premium?

• How do insurance companies make money?

• What is Insurance Deductible? Explained with example

• Life Insurance - how to buy life insurance

• Health Insurance - Medical, Dental, Vision

• Auto Insurance and its components

• Homeowners insurance

• Renters insurance

• Identity Theft Protection

• Course Wrap up and Idea to insure investments in stock market

By the end of this section, you will have a sound understanding of your insurance options to protect yourself financially.

Here are the topics we will cover in section 4.

• Introduction to Retirement Planning

• Why should you worry about retirement at all?

• Types of popular retirement accounts available in the United States

• 401(k) account - who is eligible, and how it provides tax advantage

• IRA account - who is eligible, and how it provides tax advantage

• ROTH IRA account - what is it and why it makes sense to contribute to ROTH IRA, especially for young professionals

• What is RMD or Required Minimum Distribution - how to compute RMD to avoid penalties

• 401(k) Employer contribution match - multiple ways in which employer contribution match can be structured, with easy to understand examples.

• 401(k) Vesting - what is the concept of vesting, how it can be structured - explained with easy to understand examples.

• Investment options in retirement accounts

• Deep Dive into a target retirement date fund - historical returns and asset allocation based on target retirement year.

• Two mistakes to avoid while retirement planning - starting late, and paying higher fund management fees.

• Course wrap up and a clear answer to - should you pay off debt first or contribute to a 401(k) plan first?

By the end of this section, you will have a sound understanding of your retirement planning options to build your own strategy.

This course is suitable for anyone and everyone who intends to understand their personal finance better and take actions to take control of their finance.

All information is general in nature, and should not be construed as tax, legal, investment or any other advise. Please do your own due diligence.

Suggested Project For Students:

Create Your personalized MoSCoW donut

1. Categorize your monthly expenses in the four categories: M, S, C, W as explained in the course.

2. Download the MoSCoW file from the Finpins website.

3. Update the sheet with your numbers and categorization.

4. Refresh to create your own MoSCoW donut.