UNIVERSITI TEKNOLOGI MARA JOHOR

SEGAMAT CAMPUS

FIN 533: PERSONAL FINANCIAL PLANNING

INDIVIDUAL ASSIGNMENT:
FINANCIAL PLANNING OF
EN. ZABRIDIN AND FAMILY

PREPARED BY:
HASYA AUNI BINTI ZABRIDIN
(2021149771)
JBC2512A

PREPARED FOR:
SHAHIRA ABDUL JABAR
 Table of Contents
Acknowledgement ............................................................................................................................................. 1

Biography of the family ..................................................................................................................................... 2

Financial Information......................................................................................................................................... 3

Monthly Expenses .............................................................................................................................................. 4

Balance Sheet Statement .................................................................................................................................... 5

Cash Flow Statement ......................................................................................................................................... 7

Financial Ratios ................................................................................................................................................. 9

Income Tax Year Assessment 2021 ................................................................................................................. 11

Comment and Advice ...................................................................................................................................... 12

Insurance Planning ....................................................................................................................................... 12

Investment Planning..................................................................................................................................... 13

Retirement Planning..................................................................................................................................... 13

Estate Planning............................................................................................................................................. 13

References ........................................................................................................................................................ 14
 Acknowledgement

First and foremost, praise and gratitude to God, the Almighty, for His blessings in allowing me
to complete the lecturer's assignment.

I'd like to express my gratitude to Madam Shahira Abdul Jabar, my lecturer, for her patience
in guiding me through the assignment. Her advice has been extremely helpful in assisting me in
completing this assignment in the time allotted. In addition, I'd like to thank my father, En. Zabridin,
for his assistance in completing the assignment. It will be difficult for me to complete the assignment
within the time frame if he does not contribute.

Finally, I'd like to express my gratitude to my family and friends for their continued support
and encouragement as I worked on this project. Their encouragement and support are extremely helpful
when I am feeling demotivated, and I was able to complete the assignment successfully.

EN. ZABRIDIN’S FINANCIAL PLANNING 1

 Biography of the family

I was given the task of creating financial plans for a family for this FIN533 individual
assignment, and I chose to do so with my own family. En. Zabridin bin Abd Karem works as a teacher
for the government in Segamat, Johor. He is 55 years old and married to Pn. Azian, a teacher who has
two sons and a daughter. This family consists of five members. Haziq, his first child, is 23 years old
and still a full-time student at UTHM, where he is pursuing a Bachelor of Computer Science (Hons.)
Multimedia Computing with a semester fee of RM700. Hazim, his second son, is 22 years old and he
pursued degree at NMUC, where he receives a PTPTN loan to further his education. Hasya, En.
Zabridin's youngest child, is a year younger than his second son, who is still studying Bachelor of
Business Administration (Hons) Finance at UITM Segamat branch and paying RM580 per semester
in college fees.

En. Zabridin earns a monthly salary of RM 7,117 with total allowances of RM 1,500. Pn. Azian,
his wife, is paid RM6,702 per month with a sum of RM 1,050 allowances. En. Zabridin and his wife
applied for the JPA pension fund scheme, and when they retire, they will receive the funds. En.
Zabridin and his family had been living in a house in Bandar Putra, Segamat, Johor, that he had
purchased in 2001 with a monthly loan instalment of RM 413 that had come to an end at the end of
this year. En. Zabridin also owns a Honda Civic and a Toyota Wish for his family's daily use, as well
as a Honda Wave motorcycle. All the vehicles have already been paid in full. The loan instalment for
Toyota Wish was paid off this year, with the final payment of RM 1,200 made in September. En.
Zabridin also owned furniture and electronic appliances such as a mobile phone, laptop, and a printer,
which he purchased for RM 380 in March. En. Zabridin also makes Tabung Haji and ASB savings
investments.

EN. ZABRIDIN’S FINANCIAL PLANNING 2

 Financial Information
Below are the details of En. Zabridin’s financial information for year 2021.
Details RM Housing Loan Balance 826
Monthly Salary: CIMB Credit Card
3,750
En. Zabridin 7,117 Outstanding Balance
Pn. Azian 6,702 Purchase of Printer 380
Monthly Total Allowance: Monthly expenses:
En. Zabridin 1,500 Life Insurance 500
Pn. Azian 1,050 Personal Loan Instalment 3,500
Savings Account Balance as at Credit Card Payment 400
31 December 2021: Utilities 600
En. Zabridin 2,000 Unifi internet subscription 70
Pn. Azian 2,500 Astro bill 171
Cash in Hand 1,150 Indah Water Consortium 30
House 250,000 Groceries 300
Honda Civic 45,000 Tabung Haji 30
Toyota Wish 120,000 ASB 100
Furniture 7,000 Zakat 100
Xiaomi mobile phone 250 Donation 27
Acer laptop 1,200 Toyota Wish Installment 1,200
Honda Wave motorcycle 3,800 (until Sept)
Gratuity of Pension Fund as at 241,800 House Loan Installment 413
31 December 2021 Income Tax 1,941
Tabung Haji Balance as at 31 2,000 College Fees:
December 2021 Haziq 1,400
Personal loan Outstanding 198,455 Hasya 1,160
Balance

EN. ZABRIDIN’S FINANCIAL PLANNING 3

 Monthly Expenses
Below are details of monthly expenses of En. Zabridin and his family.

Monthly Expenses
JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC Total
Details
RM RM RM RM RM RM RM RM RM RM RM RM Expenses
Life Insurance 500 500 500 500 500 500 500 500 500 500 500 500 6,000
Personal Loan Installment 3,500 3,500 3,500 3,500 3,500 3,500 3,500 3,500 3,500 3,500 3,500 3,500 42,000
Credit Card Payment 400 400 400 400 400 400 400 400 400 400 400 400 4,800
Utilities 600 600 600 600 600 600 600 600 600 600 600 600 7,200
TM Unifi bill 70 70 70 70 70 70 70 70 70 70 70 70 840
Astro bill 171 171 171 171 171 171 171 171 171 171 171 171 2,052
Indah Water Consortium 30 30 30 30 30 30 30 30 30 30 30 30 360
Groceries 300 300 300 300 300 300 300 300 300 300 300 300 3,600
Tabung Haji 30 30 30 30 30 30 30 30 30 30 30 30 360
ASB Savings 100 100 100 100 100 100 100 100 100 100 100 100 1,200
Zakat 100 100 100 100 100 100 100 100 100 100 100 100 1,200
Donation 27 27 27 27 27 27 27 27 27 27 27 27 324
Toyota Wish Installment (until Sept) 1,200 1,200 1,200 1,200 1,200 1,200 1,200 1,200 1,200 10,800
House Loan Installment 413 413 413 413 413 413 413 413 413 413 413 413 4,956
College Fees:
Haziq 700 700 1,400
Hasya 580 580 1,160
Income Tax 1,941 1,941
Purchase of Printer 380 380
Total 7,441 7,441 9,101 9,382 7,441 7,441 7,441 7,441 8,141 6,821 6,241 6,241 90,573

EN. ZABRIDIN’S FINANCIAL PLANNING 4

 Balance Sheet Statement
Below is balance sheet statement of En. Zabridin and family as of 31 December 2021.

En. Zabridin and Family

Balance Sheet as at 31 December 2021
RM RM
Liquid Asset Non-Current Liabilities
Personal loan Outstanding 198,455
Savings Account Balance: Balance
En. Zabridin 2,000 Housing Loan Balance 826
Pn. Azian 2,500
Cash in Hand 1,150

Lifestyle Assets Current Liabilities

House 250,000 CIMB Credit Card Outstanding 3,750
Balance
Honda Civic 45,000
Toyota Wish 120,000
Furniture 7,000
Xiaomi mobile phone 250
Acer laptop 1,200
Honda Wave motorcycle 3,800

Investment Assets
Gratuity of Pension Fund as at 31 241,800 Total Liabilities 203,031
December 2021
Tabung Haji Balance as at 31 2,000 Net Worth 473,669
December 2021
Total Assets 676,700 Total Liabilities and Net 676,700
Worth

EN. ZABRIDIN’S FINANCIAL PLANNING 5

 According to the balance sheet as of December 31, 2021, En. Zabridin and his family
have total assets of RM 676,700, which is a significant amount. The liquid assets are cash in
hand and En. Zabridin's and Pn. Azian's savings accounts with the amount of RM 5,650. Next,
En. Zabridin's lifestyle assets include two cars, a Toyota Wish and a Honda Civic, both of
which he paid in full this year. He also owns a Honda Wave motorcycle, which he paid fully
for many years ago. In addition, En. Zabridin owns the house he purchased in 2001 for RM
250,000 at market value. Furthermore, En. Zabridin owned RM 7,000 worth of furniture. En.
Zabridin had purchased an ACER Laptop for RM 1,200 in current value. En. Mohd Sabri used
his pension fund and Tabung Haji as a place to invest his money for his investments. These
assets are significant because they may be useful to the family in the future and may serve as
an emergency fund if something unexpected occurs. The current liabilities are an RM 3,750
CIMB credit card balance that will be paid this year because the duration of current liabilities
to be paid is less than one year. Non-current liabilities include En. Mohd Sabri's personal loan,
which has a balance of RM 198,455.

The details of En. Zabridin's JPA pension fund scheme, which is classified as an
investment asset, are listed below.

Pension Fund Scheme

Compulsory Retirement Date 7 October 2026
Reckonable Period of Service 453 months
Monthly Pension RM 4,270
Gratuity RM 241,800
Cash Award in lieu of leave RM 34,468

EN. ZABRIDIN’S FINANCIAL PLANNING 6

 Cash Flow Statement
Below is cash flow statement of En. Zabridin and family as of 31 December 2021.
En. Zabridin and Family
Cash Flow Statement for the year ended 31 December 2021
RM RM
Cash Inflows
Monthly Salary
En. Zabridin (7,117 x 12) 85,404
Pn. Azian (6,702 x 12) 80,424
Monthly Total Allowance
En. Zabridin (1,500 x 12) 18,000
Pn. Azian (1,050 x 12) 12,600

Total Cash Inflows 196,428

Cash Outflows
Life Insurance 6,000
Personal Loan Installment 42,000
Credit Card Payment 4,800
Utilities 7,200
TM Unifi bill 840
Astro bill 2,052
Indah Water Consortium 360
Groceries 3,600
Tabung Haji 360
ASB Savings 1,200
Zakat 1,200
Donation 324
Toyota Wish Installment (until Sept) 10,800
House Loan Installment 4,956
College Fees:
Haziq 1,400
Hasya 1,160
Income Tax 1,941
Purchase of Printer 380

Total Cash Outflows - 90,573

Total Cash Flows 105,855

EN. ZABRIDIN’S FINANCIAL PLANNING 7

 The income came from En. Zabridin and Pn Azian's monthly salaries and allowances
per month, according to the cash flow statement for the fiscal year ended 31 December 2021.
The expenses this family incurred during the year are depicted in Diagram 1. The upcoming
month's expenses have decreased because the Toyota Wish car instalment was settled this year
in September. As the house loan instalment will be paid off at the end of this year, expenses
will continue to decrease next year.

En. Zabridin and Family's Monthly Expenses

45,000 42,000
40,000
35,000
30,000
25,000
20,000
15,000 10,800
10,000 6,000 7,200
4,800 3,600 4,956
5,000 840 2,052 360 360 1,2001,200 324 - 1,4001,160
1,941 380
-

EN. ZABRIDIN’S FINANCIAL PLANNING 8

 Financial Ratios

▪ Asset Liquidity

i. Liquid asset to take-home pay ratio

Liquid assets / Take-home pay x 100
= [En. Zabridin saving’s account + Pn. Azian saving’s account + Cash in Hand]
/ [Income – Income tax]
= (2,000 + 2,500 + 1,150) / (85,404 – 1,941)
= 5,650 / 83,463
= 6.77% @ 0.81 months
The family’s liquidity condition is bad because it is not between 25% - 50% range and
3 or 6 months. En. Zabridin must achieve liquid assets between 25% - 50% or 3 or
6 months in order to be on the safe side.

ii. Current ratio

Liquid assets / current liabilities
= [En. Zabridin saving’s account + Pn. Azian saving’s account + Cash in Hand]
/ [CIMB Credit Card Outstanding Balance]
= (2,000 + 2,500 + 1,150) / (3,750)
= 5,650 / 3,750
= 1.51 times @ RM 1.51
The ratio is more than 1 which portrays En. Zabridin has moderate liquidity position to
pay short term obligations.

iii. Debt ratio

(Total liabilities / Total assets) x 100
= (203,031 / 676,700) x 100
= 30%
En. Zabridin’s debt ratio is equal to 30% which he will face difficulties in
getting new loans because the ability to pay debt decreased.

EN. ZABRIDIN’S FINANCIAL PLANNING 9

iv. Debt service coverage ratio
(Income – Income tax) / Personal loan monthly instalment
= (85,404 – 1,941) / 42,000
= 83,463 / 42,000
= 1.99 times @ RM 1.99
The ratio is more than 1 which portrays the family’s ability to meet their current debt
obligation. The higher the ratio, the better because it means the family has the ability
to make payments of debt.

EN. ZABRIDIN’S FINANCIAL PLANNING 10

 Income Tax Year Assessment 2021
Below is En. Zabridin’s Income Tax for the year assessment of 2021.

En. Zabridin
Tax Return for the year of assessment 2021
RM RM
Income:
Monthly Salaries 85,404
Total Aggregate Income 85,404
(-) Monthly Donation - 324
85,080
(-) Reliefs
Individual 9000
Children:
Haziq studied in Degree at UTHM 8000
Lifestyle 2500
Unifi internet subscription (840)
Astro bill (2,052)
Life insurance 6000
Total Reliefs - 25,500
Chargeable income: 59,580
Income tax computation:
On the first 50,000 1,800
On the next 9,580 (14%) 1,341
Total income tax 3,141
(-) Rebates:
Zakat 1,200
Total Rebates - 1,200
Total tax charged 1,941
(-) Monthly Tax Deduction 0
Tax Payable 1,941

EN. ZABRIDIN’S FINANCIAL PLANNING 11

 Comment and Advice

According to the above statement, En. Zabridin has moderate assets or savings to cover
the family's liabilities, which total RM 676,700 in assets and RM 203,301 in liabilities. With
the amount stated on the balance sheet and the percentages of ratios, En. Zabridin may have
some difficulty paying his debt obligations, such as current and non-current liabilities, and he
may not be able to make another loan because his ability to pay the debt has decreased. Next,
this family's net worth is RM 473,669, indicating that its assets exceed its liabilities and that it
has additional savings in case of an emergency.

Based on the cash flow statement above, En. Zabridin and family experiences some
savings because the total income is bigger than the total expenses in which the amount of
savings is RM 105,855. Fortunately, En Zabridin and his wife also earned allowances every
month as much as RM 2,550 other than their monthly salary to pay up their expenses. However,
it is quite a concern that this family’s expenses are quite high despite they have sum of money
that they could save. En. Zabridin apparently spend more in paying up his personal loan
instalment which is RM 3,500 per month which is half of his salary. Moreover, En Zabridin
also could reduce the expenses on utilities which consists of electricity and water bills by
reduce its usage. Besides that, the expenses that he spends on settled up the Toyota Wish
instalment has ended on September. En. Zabridin's budget will be freed up, allowing him to
save more for the future.

Insurance Planning
Insurance planning is an essential component of financial planning and modern life.
Nowadays, insurance has become a necessity due to the numerous benefits it provides, such as
protection from financial difficulties and shortfalls if something unexpected occurs. En.
Zabridin was discovered to have purchased life insurance for himself and his family. This
insurance covers car insurance, medical insurance, and other services. With this insurance, they
can continue to live a comfortable lifestyle with minimal concern. Medical insurance, on the
other hand, aids En. Zabridin and his family in paying their bills if they contract certain
illnesses, suffer an injury or disability, or are admitted to the hospital. Aside from this
insurance, En. Zabridin may want to consider purchasing education insurance for his children
who are still in school, allowing them to pursue their education abroad. En. Zabridin can also
use SSPN for his children under the age of 29.

EN. ZABRIDIN’S FINANCIAL PLANNING 12

Investment Planning
The primary focus of financial planning is investment management. The process of
identifying and converting financial goals into a plan is known as investment planning. In
addition to saving, En. Zabridin should invest his money to earn a return on his investment for
future planning. As a result, as assets grow, so does net worth. En, Zabridin invest in Tabung
Haji, according to the balance sheet statement. En, Zabridin also participates in the JPA pension
fund, which he will receive once he retires. This fund will allow him to live comfortably in
retirement. The pension fund gratuity is RM 241,800, whereas the Tabung Haji gratuity is RM
2,000. We can invest as much as we want in Tabung Haji. This family will be able to live
comfortably in the future.

Retirement Planning
The process of determining retirement income goals, as well as the actions and
decisions required to meet those goals, is referred to as retirement planning. Identifying sources
of growth, estimating expenses, putting in place a savings plan, and managing assets and risk
are all part of retirement planning. (Kagan, Retirement Planning Definition, 2020) En.
Zabridin, a government employee, is reliant on the JPA pension fund, which contributed 60%
of his monthly salary, which he will receive every month after he retires. En. Zabridin should
reconsider whether or not to retire early in the future. After En. Zabridin retires, this retirement
plan will be sufficient for him and his family.

Estate Planning
The preparation of tasks to manage an individual's asset base in the event of
incapacity or death is referred to as estate planning. The heirs' assets and the settlement of estate
taxes are included in the planning. (Kagan, Estate Planning Definition, 2020.) The estate of En.
Zabridin and his family includes all of his assets, including liquid assets, lifestyle assets,
investments, and liabilities. He and his wife, Pn. Azian, are the sole owners of the estate. En.
Zabridin and Pn. Azian will need to make sure that the estate they own is passed down to the
right people in the future. Aside from that, En. Zabridin's will must be updated on a regular
basis as the estate changes. Wills are important because they prevent problems and
disagreements between his children, who are the beneficiaries.

EN. ZABRIDIN’S FINANCIAL PLANNING 13

 References

Kagan, J. (2020, July 30). Estate Planning Definition. Retrieved from Investopedia.com:
https://www.investopedia.com/terms/e/estateplanning.asp#:~:text=Estate%20planning%2
0is%20the%20preparation,attorney%20experienced%20in%20estate%20law.

Kagan, J. (2020, November 10). Retirement Planning Definition. Retrieved from

Investopedia.com: https://www.investopedia.com/terms/r/retirement-planning.asp

Portal pencen - JPA. Retrieved from

http://www.jpapencen.gov.my/English/compulsory.html.

EN. ZABRIDIN’S FINANCIAL PLANNING 14