Financial Planning Objectives
Goals of the financial planning process as follows:
- Standard of Living Maslow's basic needs satisfied such as food, water, clothing, shelter, and nice-to-have discretionary items, such as automobiles, vacations, entertainment.
- Savings emergency funds for sudden and unexpected events, such as extra living expenses because of a fire at one's home.
- Protection DISABILITY INCOME INSURANCE; HEALTH INSURANCE; LIFE INSURANCE; PROPERTY AND LIABILITY INSURANCE (all forms designed to offer coverage against the uncertainty of a financial loss due to the PURE RISK).
- . Investment Accumulation of wealth through the return on assets deployed leading to financial independence.
- Estate Planning distribution of the invested assets held for the purpose of the accumulation of wealth in a tax efficient and effective manner.
Popular Insurance Terms
Means of funding permitted under the employee retirement income security act of 1974 (ERISA). The administrator of a pension plan can comply with required minimum funding standards by ...
Search, attraction, interview, and employment of insurance agents. This is a primary function of the general agent (GA) or agency manager. ...
Amount in a cash value life insurance policy that a policy owner will receive upon surrender of the policy, minus any outstanding loan and accrued interest. A table in the policy shows the ...
Coverage providing funds for maintenance of a business as closely to normal as possible in the event of a loss of a key person, owner, or partner. ...
Excess funds above the amount required to establish legal reserves for the policies in force. These excess funds are generated as the result of mortality savings, excess interest earned on ...
Same as term Unallocated Funding Instrument: pension funding agreement under which funds paid into a retirement plan are not currently allocated to purchase retirement benefits. The funds ...
Costs associated with the selling of a new insurance policy to a policyholder. The costs include the acquisition commission as a percentage of the first year's premium, underwriting ...
Insurance policy in force only after the insurance company approves the application. Today, most companies use the insurability conditional premium receipt. ...
Nonforfeiture option that uses the cash value of an ordinary life policy as a single premium to purchase term life insurance in the amount of the original policy. The length of the term ...
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