Test your knowledge.
Question 1:
The main steps in the financial planning process are:
A – Defining your goals, Creating a plan, Selecting investment, Implementing the plan, Monitoring and reviewing the plan. – false
B – Assessing your current financial picture, Defining your goals, Creating a plan, Implementing the plan, and Monitoring and reviewing the plan. – true
C – Assessing your current financial picture, Creating a plan, Buying life insurance, Monitoring and reviewing the plan. – false
Note: The main steps in the financial planning process are Assessing your current financial picture, Defining your goals, Creating a plan, Implementing the plan, and Monitoring and reviewing the plan.
Question 2:
Net worth is defined as:
A – Your income minus your liabilities – false
B – Your gross income minus your expenses – false
C – Your assets minus your liabilities – true
Note: Net worth is defined as your assets minus your liabilities.
Question 3:
Net income is defined as:
A – Your income minus your liabilities – false
B – Your gross income minus your expenses – true
C – Your assets minus your liabilities – false
Note: Net income is defined as your gross income minus your expenses.
Question 4:
Net worth and net income:
A – Are measures of your future growth – false
B – Are determinants of how much insurance you will need – false
C – Allow you to determine where you are currently – true
Note: Net worth and net income allow you to determine where you are currently.