Personal Finance Assignment: Bus 291, Financial Literacy, and Planning

This assignment solution for Bus 291, Personal Finance, covers essential aspects of financial planning in Canada. It begins with an overview of financial literacy and the government's role, followed by a guide to protect against tax scams. The assignment then outlines a financial plan for purchasing a vehicle, including savings strategies and investment options. A significant portion is dedicated to retirement planning, discussing investment vehicles like principal-protected investments, mutual funds, and ETFs. The assignment concludes with valuable lessons learned, emphasizing the importance of retirement planning, tax scam awareness, and informed financial decision-making. The bibliography includes various books and journals on personal finance topics.

Bus 291 Personal finance

TABLE OF CONTENTS
Section 1..........................................................................................................................................3
Section 2..........................................................................................................................................3
Section 3..........................................................................................................................................4
Section 4..........................................................................................................................................4
Section 5..........................................................................................................................................5
Bibliography....................................................................................................................................7

SECTION 1
Financial literacy in Canada
The federal government must make use of several methods to connect with Canadians.
They can better connect with RESP’s, CPP, Canada saving bonds, immigration offices etc. There
are many ways by which government can connect with Canadians and can generate more
motivation and capability in the environment1. The best example is the new Tax Free Savings
Account. With no motives, almost all Canadians will not willingly self-educate themselves.
However, there is existence of several motives and could be exploited. The most important
concept is the general education of economy and finance2. The financial education offers tools
and techniques for an efficient and bright future whereas economic education offers the way to
build up that future that is effective decision making and attaining success.
SECTION 2
Comprehensive guide for Canadian tax filers in order to protect themselves from tax scams:
 Canadian Revenue Agency advices to confirm the status of tax accounts before taking
any further action in accordance with suspicious calls or emails. For the purpose of
verifying the legitimacy of communication tax file can contact directly to CRA or check
my account or My Business Account on website.
 In case any personal information has been provided, Trans Union and Equifax should be
communicated for placing fraud alert on your account.
 It should be remembered that CRA never enquire regarding personal information through
email such as bank account, prepaid card details etc.
1Remund, David L. "Financial literacy explicated: The case for a clearer definition in an increasingly complex
economy." Journal of Consumer Affairs44, no. 2 (2010): 276-295.
2Boisclair, David, AnnamariaLusardi, and Pierre-Carl Michaud. "Financial literacy and retirement planning in
Canada." Journal of Pension Economics & Finance (2015): 1-20.

SECTION 3
Financial plan for purchase of vehicle
The goal’s statement is that, after being well settled in Canada, The biggest purchase I would
make is a car. Owning a car here is normal for people here, it is because it travelling easier. The
expected cost of car is $50700. A saving plan will include pocket money savings, part time jobs,
and mutual fund investment3.A well-researched estimate of for expected rates of return will be
implementation of strategies in order to assess possible challenges, portfolio development by
relating risks and outcomes expectations and changing the manner of expenditure. Another
option that can be applied for increase the saving on car is transfer from your checking account
to saving account. If this option is not available than amount can be transferred to car account or
emergency fund. The rate of interest can be approximately .25%. It is one of easy way of making
saving; in case higher return are expected amount can be invested in shares but higher risk will
also have to be beard. Further, in case any challenges in managing money for saving account;
efforts can be made to spend less or expend to the amount which is required necessarily.
SECTION 4
Planning to save for retirement
Planning of retiring will be done maybe in late 50's. A well-researched estimate of
financial needs & expenses during retirement will be medical insurance, stable payments for
living and lump-sum amount for future expenses4. In order to achieve retirement goals early
savings are required to be done. Further budgets should be prepared and followed in order to
3Bačová, Viera, KatarínaDudeková, LenkaKostovičová, and VladimírBaláž. "Financial Planning for Retirement in
Young Adults: Interaction of Professional Experience, Knowledge, and Beliefs." StudiaPsychologica 59, no. 2
(2017): 84.
4Rossouw, Jannie. "The benefits of using a trust for your financial planning: agribusiness update." FarmBiz 2, no. 7
(2016): 19.

attain expected goals during retirement years.
Principal-Protected Investments
These investments focus on securing the money from peaks and valleys of stock market,
however sometimes it supplies access to their growth potential. Principal protected investments
examples fixed/variable rate of return and guaranteed investment certificates.
Mutual Funds
In these investments assurance of return is not there, mutual funds are usually for long
term savings along with some risk. In a mutual fund, a manager assumes the assortment of the
companies that will be provided in their funds. It can be specified as one of the most appropriate
manner of investing, as investor is able to avail gain regarding large exposure with small amount
of money. As, investors’ money is invested in viable investment options so they can earn
maximum return with taking minimum risks.
Exchange Traded Funds
ETF is inclusive of a range of securities of companies dealing in a stock market. Their
major purpose is to imitate a specific index or by following an exchange or any other financial
asset. It differs from mutual fund investment in two ways; first, their management fee is low and
attracts many investors5. Second, they deal with the same way like stock does. In this investor
can simply deal them when the stock markets are open. The main benefit which can be gained by
investing in ETF is that it provides exposure to group of equities and market segments. Even
after providing benefit of diversification one is able to trade like stock through investing in it.
SECTION 5
Valuable Lesson
The most valuable lesson which I have learned from this course is the manner in which
retirement should be planned to attain maximum benefits and return at the age when you are not
5Keown, Arthur J. Personal finance. Pearson, 2013.

able to work. Further, knowledge which I have gained relating to existing tax scams and the
manner in which one can be protect against it. It will considerably assist me in to handle the
situation in case I get in trouble like it. Further, I have enhance my knowledge regarding various
finance alternative, thus the same will assist me taking decision relating to finance in appropriate
manner.
This unit had provided me in depth learning regarding financial planning or strategy which will
assist in managing my finance and along with this I will be able to assist others. It is one of the
subject which is majorly applied practically either after graduation or at retirement. In this
aspect, this unit had provided appropriate knowledge regarding financial planning through which
I will be able to choose appropriate alternative and reduce the payable cost also. Further, learning
relating to appropriate manner of investing in detail i.e. comparing various available alternatives
along with the return available has been provided; so that one is able to take rational decisions
relating to future planning in appropriate manner.

BIBLIOGRAPHY
Books and journals
Bačová, Viera, KatarínaDudeková, LenkaKostovičová, and VladimírBaláž. "Financial Planning
for Retirement in Young Adults: Interaction of Professional Experience, Knowledge, and
Beliefs." StudiaPsychologica 59, no. 2 (2017): 84.
Boisclair, David, AnnamariaLusardi, and Pierre-Carl Michaud. "Financial literacy and retirement
planning in Canada." Journal of Pension Economics & Finance (2015): 1-20.
Cull, Michelle. "The role of trust in personal financial planning." (2015).
Diggdon, Andrew J., John Maher, Karen Lynne Moore, Yon Wing Lee, and Brian Paul
McMahon. "Financial management system and method with debt management." U.S. Patent
8,719,132, issued May 6, 2014.
Keown, Arthur J. Personal finance. Pearson, 2013.
Remund, David L. "Financial literacy explicated: The case for a clearer definition in an
increasingly complex economy." Journal of Consumer Affairs44, no. 2 (2010): 276-295.
Rossouw, Jannie. "The benefits of using a trust for your financial planning: agribusiness
update." FarmBiz 2, no. 7 (2016): 19.