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Personal Finance Principles and Rules

1. The document provides instructions for Exercise #3 on personal finance principles and concepts. It asks students to submit answers to 3 questions by a specified deadline through email, GChat, or private message. 2. The questions ask students to define the 3 golden rules of money management, provide an example of an impulse purchase, and present how a monthly salary would be allocated under the 70-20-10 rule and 50-30-20 budget rule. 3. For the 70-20-10 rule, 14,000 would be allocated to living expenses, 4,000 to savings, and 2,000 to debt. For the 50-30-20 rule, 10,000 would be allocated to needs,

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Joannie Bonghanoy
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6 views2 pages

Personal Finance Principles and Rules

1. The document provides instructions for Exercise #3 on personal finance principles and concepts. It asks students to submit answers to 3 questions by a specified deadline through email, GChat, or private message. 2. The questions ask students to define the 3 golden rules of money management, provide an example of an impulse purchase, and present how a monthly salary would be allocated under the 70-20-10 rule and 50-30-20 budget rule. 3. For the 70-20-10 rule, 14,000 would be allocated to living expenses, 4,000 to savings, and 2,000 to debt. For the 50-30-20 rule, 10,000 would be allocated to needs,

Uploaded by

Joannie Bonghanoy
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd

Personal Finance RMSuarez, MBA

7:30 to 9:00am M/W BSBA HR3 Instructor


7:30 to 9:00am T/TH BSBA FM3

Exercise #3 (Principles & concepts of personal finance – File7 Module 3)


Instruction: Answer the questions below. Submit your answer on or before 5:00pm of Sunday,
October 31, 2021 thru (choose only 1 among the 3 options):
1. email add: busneduc.scc2021@[Link] (specify the subject & exercise # on the
title/subject head of your email)
2. GChat (specify the subject & exercise #)
3. Private message (messenger account: rene suarez) specify the subject & exercise #

Questions:
1. What are the three (3) golden rules in money management?
Ans.
Golden Rule #1: Don't spend more than you make.
Golden Rule #2: Always plan for the future.
Golden Rule #3: Help your money grow.

2. Give an example of an “Impulse upurchases”. (2 points)


Ans.
If you are in a restaurant when you are hungry, you go there to buy food or meals. However,
when you order, you will see your favorite brand of drink served to another customer. So you
can buy that drink too.

3. Rules of Money. From the narrative below, give a detailed presentation on how
would you allocate the monthly salary on the following instances;
(a) 70-20-10 rule
(b) 50-30-20 budget rule
Mr. Alex Gonzales, a young professional, and working in a financing company as
an analyst. His monthly take home pay is 20,000 pesos and is asking for your
help on how to apply the above mentioned money rules. (5 points each)

Total score for this exercise: 15 points

===========================end of exercise #3=========================


Ans.
A. 70-20-10 Rule
70% for living expenses (clothing, transportation, food and beverage)
20% for savings
 10% for retirement (
 5% for emergency ( medical expenses, house repair)

1
 5% specific goals (tution, vacation)
10% for debts (car loan, donations)
This will be your monthly budget:
 14,000 will be your living expenses
 4,000 will be your savings
 2,000 will be your debt

B. 50-30-20 budget Rule


50% will goes to Needs ( groceries, cloth)
30% will goes to Wants (traveling, sports car, dream house)
20% will goes to Savings (savings account, investment)
Based on the 50/30/20 budget rule
 The amount you should allocate to needs is 10,000(20,000×0.50)
 The amount you should allocate to wants is 6,000(20,000×0.30)
 The amount you should allocate to savings is 4,000(20,000×0.20)

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