Course | Madison College Outline of Instruction

10114130Personal Finance

Course Information

Description

This introductory course considers finance from the point of view of the individual or family unit. Topics include budgets, insurance, housing, borrowing, saving, investing and estate planning. Students complete personal finance projects applying the material learned.

Total Credits

Course Competencies

Develop a personal budget

Assessment Strategies

Project

Criteria

You track expenses for a month

You determine monthly income from all sources (including financial aid if applicable)

You estimate monthly expenses based on representative tracking

You include expenses such as tuition that do not occur on a monthly basis

You use excel to set up your budget

You use formulas in excel to calculate totals

You use formulas in excel to calculate budget variances

You design a template that is easily expandable to a yearly budget

You design a template that is easily updated and revised
Build an investment portfolio

Assessment Strategies

Project

Criteria

You perform research on common stocks

You perform research on equity mutual funds

You analyze and select stocks for your portfolio based on your age and risk tolerance

You determine and select mutual funds for your portfolio based on criteria list

You set up your portfolio in excel

You use formulas in excel to determine number of shares and new values each week

You use relative and absolute references judiciously in excel

You graph the changing values of your investments in excel
Recommend asset allocations for different ages

Assessment Strategies

Project

Criteria

You research suggested allocations from industry professionals

You determine and recommend allocations for selected ages

You justify your recommendations by documenting sources

You set up allocations in excel

You produce pie charts in excel illustrating your allocation recommendations
Identify Time Value of Money components

Assessment Strategies

Exam

Criteria

You correctly define Number of Compounding Periods

You correctly define Number of Payments

You correctly define Present Value

You correctly define Future Value

You correctly define Lump-Sum amounts

You correctly define Ordinary Annuity Payments

You correctly define Annuity Due Payments

You correctly define the Annual Interest Rate

You correctly define Periodic Interest Rates (Semi-Annual, Quarterly, Monthly, Daily, Continuous)
Develop proficiency with a financial calculator

Assessment Strategies

Exam

Criteria

You practice entering Present Value

You practice entering Future Value

You practice entering Annuity Payments

You practice entering Interest Rates

You practice entering Number of Compounding Periods

You practice entering Number of Payments

You practice solving for the unknown element
Perform Time Value of Money calculations

Assessment Strategies

Exam

Criteria

You compute Present Value

You compute Future Value

You compute Ordinary Annuity Payments

You compute Annuity Due Payments

You compute Interest Rates

You compute Number of Compounding Periods You compute Number of Payments
Illustrate a “true” understanding of Time Value of Money concepts

Assessment Strategies

Exam

Criteria

You illustrate the concept of Opportunity Cost

You create problem scenarios from a list of information

You correctly identify the optimal choice using Time Value of Money calculations

You properly interpret the components in various Time Value of Money problems
Identify consumer credit alternatives

Assessment Strategies

Exam

Criteria

You define Banks

You define Credit Unions

You define social lenders (peer to peer) such as Lending Club and Prosper

You define Pay Day Lenders

You compute Effective Annual Interest Rates

You compare loan alternatives using effective annual interest rates as the criterion

You define and compare Auto Loans

You define and compare Personal Loans

You define and compare Student (Educational) Loans

You define and compare Home Equity Loans

You define and compare Home Equity Lines of Credit

You define and compare Credit Cards

You define Credit Report

You interpret a credit report

You define Credit Score

You interpret a credit score
Explore various investment and savings alternatives

Assessment Strategies

Exam

Criteria

You define treasury bills

You define treasury notes

You define treasury bonds

You define certificates of deposit

You define savings accounts

You define money market accounts

You define money market mutual funds

You define corporate bonds

You define bond ratings

You define investment grade bonds

You define high yield (junk) bonds

You define bond mutual funds

You define common stock

You define cyclical stock

You define blue-chip stock

You define defensive stock

You define utility stock

You define growth stock

You define preferred stock

You define equity mutual funds

You define real estate investments

You define precious metals investments

You define crypto currency investments (Bitcoin)

You define international investments

You define foreign exchange risk

You define growth investment theory

You define value investment theory
Explore housing and mortgage alternatives

Assessment Strategies

Exam

Criteria

You identify various housing alternatives

You perform Buy versus Rent comparisons

You compare fixed rate mortgages to adjustable rate mortgages

You determine the optimal mortgage using Personal Opportunity Cost and Time Value of Money

You define Points

You define Teaser Rate

You define Underlying Index

You define Lender’s Margin

You define Fully Indexed Rate

You define Annual Interest Rate Cap

You define Life of Loan Cap

You calculate mortgage payments

You create amortization schedules

You split up principal and interest

You compute cumulative interest payments

You compute cumulative principal payments

You calculate remaining mortgage balances at different stages of the mortgage
Explore insurance alternatives

Assessment Strategies

Exam

Criteria

You define Auto insurance

You define Health insurance

You define Disability insurance

You define Homeowners insurance

You define Life insurance

You define Renters insurance

You define Umbrella policy

You define “Deductible”

You define “Co-insurance clause”

You define “Liability Limits”

You compare various insurance options

You determine optimal insurance coverages based on current age and life situation

You identify health insurance requirements under the Affordable Care Act
Perform tax planning and retirement planning

Assessment Strategies

Exam

Criteria

You define Standard Deduction

You define Itemized Deductions

You define Short-term Capital Gains and Losses

You define Long-term Capital Gains and Losses

You define Wash-Sale Rules

You perform personal income tax calculations

You define “Defined Benefit Plan”

You define “Defined Contribution Plan”

You define 401-k

You define 403-b

You define 457 plan

You define Traditional Individual Retirement Account (IRA)

You define Roth Individual Retirement Account (IRA)

You compare trade-offs between Traditional IRAs and Roth IRAs

You compare trade-offs between IRAs and Employer sponsored retirement plans

You determine optimal retirement vehicle(s) for you based on current age and life situation

You explore expected financial retirement needs

You explore retirement goals

You create spreadsheet to track progress toward retirement goals
Identify key elements of estate planning

Assessment Strategies

Exam

Criteria

You define a Last Will and Testament

You define a Living Trust

You define Probate

You define Beneficiary Designation

You define Financial Power of Attorney

You define Medical (Health Care) Power of Attorney

You define Do Not Resuscitate (DNR) order