tailieunhanh - Lecture Personal financial planning – Chapter 19: Behavioral financial planning

The goals of this chapter are: Improve upon PFP performance, apply behavioral finance to PFP, target human characteristics that can undermine your objectives, learn how to overcome human weaknesses, . | Lecture Personal financial planning Chapter 19 Behavioral financial planning Chapter 19 Behavioral Financial Planning 1 Chapter Goals Improve upon PFP performance. Apply behavioral finance to PFP. Target human characteristics that can undermine your objectives. Learn how to overcome human weaknesses. Identify goals that differ from traditional money ones. Evaluate the strengths and weaknesses of behavioral finance. 2 Overview Knowledge of actual human behavior is arguably more important for PFP than for any other area of finance given its closeness to human actions and its emphasis on practicality. Many people come to financial planners as much to get structured as for the specific recommendations. Behavioral financial planning operations can be separated into two components. Traditional money planning and making more efficient financial decisions. Help clients reach their nonmonetary goals which are 3 incorporated under the term Life Planning. The Goal and Role of Behavioral Finance Our goal is to understand and evaluate the contribution of behavioral analysis to PFP. To understand the role of behavioral finance we recall what finance is and contrast finance theory with actual behavior. By traditional finance You are assumed to act logically all the time. You have perfect knowledge of all the information you need. You have full capability for recalling past experiences. You have the intellectual capacity to make the right decisions at all times. Markets are highly competitive with no opportunity for expecting and achieving greater than average profits. All other human beings have the same tastes preferences beliefs and abilities. 4 The Goal and Role of Behavioral Finance cont. Behavioral economics and behavioral finance examine people as they actually are. Behavioral finance The study of human makeup and actions that result in deviations from logical economic and financial behavior. Behavioral finance is controversial. Criticisms It has no scientific .

• Tài chính doanh nghiệp
• Personal financial planning
• Personal financial
• Lecture Personal financial planning
• Financial planning
• Behavioral financial planning
• Behavioral life cycle theory
• Characteristics of finance
• Finance tools
• Cash flow planning
• Flow planning
• Special circumstances planning
• Divorce planning
• Planning process
• Behavioral finance
• Retirement planning
• Retirement assets
• Educational planning
• Establish educational goal
• Tax planning
• Income taxation
• Estate planning
• Identify assets
• Financial statements analysis
• Financial statements
• Financial investments
• Expected rate of return
• Financial leverage
• Interest rates
• Time value of money
• Present value