GROUP FIV E

Business Finance
PERSONAL FINANCIAL
MANAGEMENT

• It is the process of controlling individual's

income and expenses.

• Personal finance - pertains to personal financial

planning such as savings plan for contingencies,
financial products intended for retirement,
investment for maximize wealth.
BASIC ECONOMIC ACTIVITIES OF
INDIVIDUALS

EARNINGS
SPENDING

SAVING BORROWING
EAR NING
- to receive money as payment for work or
service rendered.

S OU R C ES OF EA R N I NG S
• Compensation income

• Income from business

• Passive Income

SPENDING
- the act of using money for a particular
thing or purpose.
 BASIC
E XPE NSE S:

Food Transportation Health Care Entertainment

Debt/Obligation Clothing Personal Care Miscellaneous
 SAVING
- to put aside money or specific thing for
later use or purpose.

"L AT E R USES" F O R S AVI N G S :

• Emergencies

• Recurring expenses

• Financial goals

• Retirement

• Future purchases
B OR ROWING
- obtaining money, goods, or services at
present in exchange for the promise of
future payment.

E X AM PLES OF B OR R O W I N G

• Buying with a credit card

• Buying on instalment

• Loans

• Cash advances

• Layaway purchases
BASIC E CONO M I C
ACT IVIT IE S O F
INDIVIDUA L S
• RESPONSIBLE EARNING
- realizing that career choices greatly affect lifetime
earnings & standard of living & considering these factors
when making career choices.

• RESPONSIBLE SPENDING
- researching and planning purchases in advance and
making wise choices in light of opportunity costs and
trade-offs that apply.

• RESPONSIBLE SAVING
- forming the habit of saving regularly & finding forms
of saving that yield high return.

• RESPONSIBLE SAVING
- borrowing only what can be paid back when due.
IMPORTANCE OF P ER S ONAL
FINANCIAL PLANNING

• To know your limits

• To schedule your activities

• To pursue your goals

• Reduces stress

• Prepare yourself for emergencies

 ST E PS IN
FINANCIA L
PL ANNIN G
1. ASSE SS YOUR CUR R E NT POSITION
2. Determine your goa ls
3. E sta blish your sources of incom e
4. Determine your exp enditures
5. E v olve strategies to increa se incom e or limit
Ex p end iture
6. Ind icate timing f or receipts a nd d isb ursement
FACTOR S AFFEC TING PERSONAL
FINANCIAL MANAGEMENT
• Lack of discipline

• Lack of planning

• Not taking future into account

• Not controlling expenditures.

• Abuse ATM/Credit card

• Arrogance

• Gambling
 S P E CIAL T E CHNIQUE S I N S AVING M ONE Y

• Yona Abella saved more than P40,000 in 5 months.

• She had been a great spender before who realizes to prepare and save for
responsibilities in life. She was able to save 846 pieces of P50 bill in 5
months.
• How did she do it?
• Yona stated that she treated all her P50 bills as invisible - she can't use it.
Filipino savings challenge by Kuripot Pinay, a Filipino blogger

This money challenge is all about saving weekly, but with increments. It can be any
amount depending on how much money you want to achieve by the end of the year.

Increment After 52 weeks

P10 P13,780

P20 P27,560

P50 P68,900

P100 P137,800
Example: 5 peso
Example: 20 peso
Example: 100 pesos
THANK
YOU!