FINS5510 Personal Financial Planning
INSTRUCTIONS
Financial Plan Assignment
Andrew Hingston v2023.1.1
Overview
The purpose of this assignment is to help you to develop a detailed financial plan that
will act as a financial roadmap for the rest of your life. Each section of your financial
plan provides you with the opportunity to reflect deeply on the theory covered in the
course and to make practical, specific and detailed application of that theory to your
expected future life stages. You should work on your financial plan gradually during
the term as you cover each Unit. You should use the Microsoft Word template provided
and submit the final document in Microsoft Word format. There is no word limit for this
assignment but most submissions are between 3,000 and 9,000 words.
The financial plan that you will develop is far more comprehensive (and useful) than a
typical ‘Statement of Advice (SOA)’ that a financial adviser would prepare for a client.
This is because the focus of this course is on understanding the broad issues that
financial advisers need to consider when advising clients. The follow-on course to this
one, FINS5537 Financial Planning Advice and Ethics, will focus on the process of
developing a compliant and ethical SOA for clients. Nevertheless, under the final
section of your Assignment you are required to identify the differences between the
Financial Plan that you are submitting for this course and a compliance Statement of
Advice (SOA).
This is an individual assignment. Copying the work of another student, basing your
financial plan on another student’s work, asking anyone else to write your financial
plan, obtaining assistance from an Artificial Intelligence computer program, providing
a copy of your financial plan to another student or posting your financial plan on a
website is academic misconduct and will result in a fail grade being awarded for this
course.
Weight
The Financial Plan assignment is worth 50% of your assessment for this course.
Due Date
The due date for the financial plan assignment is as follows:
Assessment component Due Date*
Financial Plan Assignment 1:00PM Mon 1 May 2023 (Week 12) Sydney time
* All times are Sydney time
Backup your work
You should be writing your financial plan assignment gradually over the term after you
have completed each Unit. You need to plan for a situation in which the file may
become corrupted or your device is damaged. Please create regular copies of your
work and place them into a ‘Backups’ folder. Make sure this folder is synchronised onto
a USB key or a cloud-based storage solution such as OneDrive or Dropbox (or an
equivalent service in China for students who cannot access these services). Loss of
data or a damaged device does not constitute grounds for Special Consideration.
Late Penalties
Late submission will incur a penalty of 5% per day or part thereof (including weekends)
from the due date and time. An assessment will not be accepted after 5 days (120
hours) of the original deadline unless special consideration has been approved. An
assignment is considered late if the requested format, such as hard copy or electronic
copy, has not been submitted on time or where the ‘wrong’ assignment has been
submitted.
The late penalty applies to your score for the financial plan (not the maximum possible
score). For example, if your raw score is 70/100 and the plan is submitted 2 days late,
a 10 mark penalty will apply and so your score would be reduced to 60/100.
Note that there is a small ‘grace period’ of a few minutes after the submission time to
allow for slow internet connections or slow website performance. No penalty will apply
if the submission is within this ‘grace period’. Please do not email me asking if your
submission falls within this grace period.
Since you are supposed to be working on this assignment gradually each week as the
course progresses, the maximum period of special consideration that will be granted
for this assessment (for any reason) is 7 days from the original due date. Also, the
maximum extension that will be granted for Equitable Learning Plans will also by 7
days from the original due date. Any submissions received after this will automatically
be awarded a score of zero.
Special Consideration
Special consideration will only be granted in exceptional cases. You are responsible
for developing your financial plan gradually as you work through each Unit of the
course materials. You should work on your financial plan as you cover each Unit and
avoid leaving it until last minute. You are responsible for completing your financial plan
well before the due date/time to allow for unexpected circumstances or illness. Being
ill during the last week before the date of submission will not normally constitute
grounds for special consideration.
Loss of data or a damaged device does not constitute grounds for Special
Consideration. You are responsible to regularly backup your work and synchronise it
onto a cloud-based storage solution (such as OneDrive or Dropbox).
If special consideration is granted, the maximum extension that will be granted is
7 days from the original due date. Any financial plans received more than 7 days from
the original due date will automatically be awarded a score of zero.
An application for Special Consideration together with supporting documentation must
be submitted online within 3 working days of the due date. The process for applying
for special consideration is here: https://student.unsw.edu.au/special-consideration
Individual Assessment
This is an individual assessment. You are permitted to discuss the contents of this
assessment with your family, a spouse or partner. However, all written work, research
and supporting calculations must be your own work. Seeking assistance with your
written work or financial modelling constitutes academic misconduct. Seeking
assistance from Artificial Intelligence computer programs also constitutes academic
misconduct. Providing assistance to any other students also constitutes academic
misconduct. Copying or paraphrasing the work of any other student (from current or
previous terms) constitutes academic misconduct. Copying the work of another student
and then changing the details to reflect your situation and strategies constitutes
academic misconduct. Using another student’s financial plan as a ‘reference’ for you
while you complete your own financial plan is also academic misconduct. Posting a
copy of your assignment on a website is academic misconduct (except for submitting
your assignment on the course website under the appropriate submission link).
If another student approaches you for assistance, please note the time, date and
details of the incident and email the details to me at andrew.hingston@unsw.edu.au .
UNSW has no tolerance for students who are dishonest or seek to obtain an unfair
advantage over other students. Academic misconduct is a serious offence. It can result
in zero being awarded for this assessment, a failure grade for the course and/or
removal from the University.
Template
You should use the Microsoft Word Template document provided under the ‘Financial
Plan’ section of the course website. Do not use another student’s financial plan as your
template. Note that as a student at UNSW, you have access to the full suite of Microsoft
Office 365 applications. More information about accessing this software is provided
below.
Software
You should note that all students at UNSW have access to the full suite of Microsoft
Office 365 products for free (on both Windows and Mac). This includes downloadable
versions of the entire Microsoft Office suite to 15 devices (5 desktops, 5 tablets and 5
mobiles).
The steps for downloading the latest version of MS Office are as follows:
1. Go to https://login.microsoftonline.com
2. Login with the same zPass that you use for Moodle using the
‘zID@ad.unsw.edu.au’ version of your UNSW student email. For example:
z1234567@ad.unsw.edu.au
3. Click the ‘Install Office’ button at the top right of the screen.
4. Choose ‘Office 365 apps’ and follow the on-screen directions from there.
More information is available here (although it is a little out of date):
https://student.unsw.edu.au/sites/all/files/uploads/group228/notices/office-proplus.pdf
Formatting
For headings and body text, please use the styles in the Microsoft Word template
provided.
Fonts: Please only use either Arial (PC) or Helvetica (Mac) fonts. Students with
dyslexia who find these fonts difficult to read may use Times New Roman.
Font sizes: Please use font size 11 pt for your body text.
Line spacing: Use the default in the Microsoft Word Template provided (1.08 lines).
Styles: Use the styles provided in the Microsoft Word Template provided.
File format: You should submit your file in Microsoft Word format.
Filename: Please use the filename following the format ‘zID Plan.docx’. If your zID is
z999999, you should name your document
‘z999999 Plan.docx’.
For tables, diagrams, captions, footnotes and other minor formatting elements, you
can choose your own formatting and styles. Please make sure they are easy to read.
Table of Contents
You should update the page numbers in the table of contents before submitting the
final version of your financial plan as a Microsoft Word document. This can be done as
follows:
1. User your mouse to select the table of contents on page 1
2. Go to the ‘References’ tab on the command bar at the top of Microsoft Word
3. Select ‘Update Table’ under the ‘Table of Contents’ group on the Ribbon.
4. Select ‘Update Page Numbers Only’ to only update the page numbers or select
‘Update Entire Table’ to also update your Headings.
File Format
You should submit your file in Microsoft Word format.
File Name
Please name your financial plan using the following file name format (and extension):
zID Plan.docx
For example, if your student zID is z1234567, your file should be named:
z1234567 Plan.docx
Word Limit
There is no word limit or page limit for this assignment. This is your plan and so you
can ‘invest’ as much time and detail into it as you like. In past terms, most financial
plans are somewhere between 3,000 words and 9,000 words.
References and citations
As a general principle, you do not need to reference the concepts covered in my lecture
slides unless the lecture slides themselves cite another source or it makes sense to do
so given how you are using the concept in your assignment. In most cases, I’m
expecting you to reference other sources that you have identified to support the ideas
in your financial plan including websites, articles, books or videos.
Citations and references for any other article or website should follow standard
university assignment citation and referencing principles. You may use Harvard,
Oxford or APA referencing (see below).
For websites, I’m usually happy with just the author (or company), the date that it was
accessed and a URL (preferably hyperlinked). For example:
"Domain Property Group, accessed 9 January 2023, https://www.domain.com.au"
As a general principle, you do not need to reference any pictures that you use in your
financial plan.
The following website provides some good examples for referencing for other
documents:
https://student.unsw.edu.au/citing-different-sources
When referring to other sources, the standard method for citations at UNSW is in-text
(Harvard). However, in this course I don’t mind whether you use Harvard, Oxford or
APA style referencing.
More information on the in-text (Harvard) method is here:
https://student.unsw.edu.au/harvard-referencing
More information on the footnote (Oxford) method is here:
https://student.unsw.edu.au/footnote-bibliography-or-oxford-referencing-system
More information on APA referencing method is here:
https://www.student.unsw.edu.au/how-cite-references-apa-style
References are not included in your word count.
Privacy
This assignment includes personal information that is both private and confidential.
Your assignment is not used for any other purpose except to provide you with a mark
for this assessment. It will not be used for academic research or commercial purposes.
You should also note that more than 100 students undertake this course each term
and so it is unlikely that I will remember any of your personal information after I finish
marking them all (my memory isn’t that good!). However, you should note that your
financial plan will be uploaded onto the Turnitin plagiarism detection service for the
sole purpose of checking for similarity with other assignments in past, present or future
terms.
If you are concerned about the privacy of the information, you are welcome to change,
omit or redact any of the specific details that you are concerned about (such as
information about your current income or assets). Doing so will likely make very little
difference to the usefulness of your financial plan, since you can simply change those
details back to the correct values after submission.
Spouse or Partner
If you have a spouse or partner, you are also welcome to perform this assignment
based on your ‘collective’ situation and ‘collective’ plan for the future. Discussing your
financial plan assignment with your spouse or partner does not constitute academic
misconduct. However, the written financial plan, supporting research and calculations
should be your own work. For more information, see ‘Individual Assessment’ on
page 4.
Foreign Countries and Currencies
The financial plan assignment is designed to assess the key learning outcomes of this
course. Many of these learning outcomes are specific to the Australian financial
system. This presents a problem for overseas students who plan to live abroad after
they graduate, since the taxation and retirement saving systems in those countries
may be quite different from Australia.
Whether or not you plan to live abroad for a significant component of your life after
graduation, for the purposes of this assessment you must assume that the
Australian system of taxation and retirement savings (superannuation) will apply
for your entire life. For instance, you may base your plan on the assumption that you
will live in China for the rest of your life, but you must assume that only the Australian
system of taxation will apply (not the system in China) and that you will use the
Australian superannuation system to save for retirement. I understand that this could
result in some unusual circumstances at times, but it is necessary for the assessment
of this course. Of course, you are welcome to change your financial plan to reflect the
local taxation and retirement savings system after the course is completed.
Please only use Australian dollars as your currency for this assignment. You can
convert any foreign values in Australian dollars at the current exchange rate.
Financial Assistance from Family
Some students may be expecting significant financial assistance from their families or
a large inheritance from parents or grandparents after they graduate from their degrees
(or later in life). This can undermine the learning outcomes assessed by the financial
plan assessment because it can result in a financial strategy that basically argues, “I
don’t need to do anything that this course covers because my family will provide me
with everything that I need financially.”
You should undertake this assignment assuming that you will not receive significant
financial assistance from your family or others after you graduate in the form of a large
lump-sum payment, income support or gifts of property or other investments. However,
you are permitted to assume that you can move back home to live with parents while
you are saving for a deposit on your first property.
Students with disability may assume ongoing support (financial or otherwise) from
family.
Religion and Interest
Some devoutly religious students may believe that either receiving or paying interest
on borrowed funds (even under a profit-sharing arrangement using Islamic Banking) is
incompatible with their religious faith. Inclusiveness is important at UNSW and I
personally have the utmost respect for these religious beliefs. However, being unable
to borrow or lend at interest makes many of the financial strategies and products
covered in this course unviable and can therefore make it difficult to assess the learning
outcomes of the course. As such, if you hold these religious views, one approach that
you can take with this financial plan assessment is to base it on a ‘hypothetical third-
party’ (perhaps a friend) that is willing and able to borrow or lend money using Islamic
Banking services under a suitable ‘profit sharing’ arrangement. Obviously, you are
welcome to make appropriate changes to this financial plan document after submission
to reflect your personal beliefs and your own preferred financial and investment
strategies.
If you have further questions or would like to discuss an alternative approach, please
contact me at andrew.hingston@unsw.edu.au and I will be happy to discuss it further.
File Size
The maximum file size permitted by Moodle is 40MB. If your file is larger than this then
it is most likely because you have used some high-resolution images. Please locate
the super-high-res images in your document and downscale them. More on this here:
https://support.office.com/en-us/article/reduce-the-file-size-of-a-picture-in-microsoft-
office-8db7211c-d958-457c-babd-194109eb9535
Writing Style
This is your financial plan and so an informal writing style is acceptable in this
assignment. You may write in the first-person if you would like to do so. You may also
make selective use of bullet-points and tables where appropriate.
However, you are reminded that this is also an assessment for a university course.
You are expected to justify your ideas by linking them back to concepts covered in the
course or from other cited sources wherever possible.
As a general principle, it is not acceptable to justify statements in your financial plan
as being true because you “feel that they are true”. For example, “I am going to invest
all my money in Bitcoin because I feel as though this will be a good investment for the
long-term.” This form of reasoning is generally not acceptable at university. If you
believe that Bitcoin is a good investment for the long-term, you need to justify this with
logical reasoning based on theories covered in this course and/or evidence from other
sources (that are cited). You need to clearly explain your reasoning.
Structure and Content
You should use the Microsoft Word template provided under the ‘Financial Plan’
section of the course website and use the same headings provided in that document.
The following instructions on the suggested content for each section are oriented
towards a grade of somewhere between 65 to 80. If you are time-poor due to your
workload in other courses or work commitments, you may choose to miss out some of
the suggested components in each section. However, doing so may adversely affect
your overall score. If you are aiming for a score above 80, you will need to reflect deeply
on the material in each Unit and ‘go the extra mile’ in applying it to your future
anticipated circumstances. This may involve including content in each section that is
not included in these instructions (at your own initiative). The key thing is to balance
your expectations for this assignment with your time-constraints due to other
commitments.
Please also note that the content suggested here is far too much to complete in the
week before the financial plan is due. This assessment is designed to be written each
week as you work through the course material. It is designed to encourage you to think
deeply about the concepts covered in each Unit and to apply it to your own life. In some
ways it is like a journal. You are supposed to study the content of a Unit, then
immediately apply that content to your own life by writing up the relevant sections of
your financial plan.
Your financial plan should contain the following sections and content:
Title Page
The Microsoft Word template provided contains the following table. You should
complete the information in the space provided (deleting the hint text):
Student ID: Replace this text with your UNSW student zID
Given name Replace this text with your given name (UNSW student records)
Family name Replace this text with your family name (UNSW student records)
Degree program What degree are you currently studying?
Country In what country do you plan to live most of your life?
Word count Replace this text with your assignment word count
Check the student declaration to confirm that the assessment is your own work.
A table of contents is provided. You can update the page numbers as follows:
1. Use your mouse to select the table of contents on page 1
2. Go to the ‘References’ tab on the command bar at the top of Microsoft Word
3. Select ‘Update Table’ under the ‘Table of Contents’ group on the Ribbon.
4. Select ‘Update Page Numbers Only’ to only update the page numbers or select
‘Update Entire Table’ to also update your Headings.
Failing to update page numbers in the table of contents before final submission will
result in a penalty (see Assessment Criteria on page 30).
1. Current Situation (Unit 1)
This section is a statement of your current situation. It provides a starting point for
assessing the gap between your current situation and the long-term goals that you will
establish in section 2 of your financial plan. When financial advisers provide advice to
clients, listing the client’s current situation is a key component of a Statement of Advice
because it demonstrates that the adviser understands the client’s current situation
correctly.
This section can be formatted using a combination of tables and bullet-points if you
believe that this is a clear way to present the information. It does not need to be
presented as full sentences in a paragraph form.
The information is private and confidential and will not be used for research or
commercial purposes. For more information in privacy of your information, please refer
to the section on ‘Privacy’ on page 7.
This section should include the following information:
Basic Information
Your current age.
Your preferred gender description.
Your current relationship status description (eg. single, casual relationship, defacto
relationship, married). This is relevant for the estate planning and some other
sections of your financial plan.
A list of anyone who is currently financially dependent on you (usually children).
Your country of residency or citizenship. If you are an overseas student, please
also identify whether you plan to pursue residency in Australia in the future.
Your current residential living circumstances. Are you living in a residential college
or other UNSW accommodation, renting or co-renting a property, own your own
home (with or without a mortgage) or living with parents?
Your current mode of study. Are you a part-time or full-time student? Are you a
domestic or international student? What is your degree program and major? When
do you expect to complete your current degree?
Your current employment status. Are you working part-time, full-time or currently
not working? What is the name of your employer and what is your current job role?
Income Statement
An income statement estimates your income, expenses and profit over the last 12
months. As discussed in Unit 1 of the course, income statements are always measured
over a period of time (often one month or one year). The key formula for an income
statement is ‘income less expenses is equal to profit’. Following are a few tips:
You likely haven’t been recording your income and expenses over the last year and
so some estimation will be necessary. I obviously don’t know the ‘truth’ of your
income and expenses over this period. However, you should do your best to
estimate your key expense categories, since they are usually needed for any home
loan applications and are useful for establishing a budget.
Many students are engaged in casual work and so income earned can vary
significantly between weeks and months of the year. If your income is variable, one
approach is to simply calculate your total income over the last 12 months and then
divide the total by 12 to calculate an ‘average’ monthly income. The key thing is
that it is normal for income to be ‘lumpy’ if you are working casual jobs or pursuing
holiday employment. However, usually an ‘average’ monthly income across the
entire year is the number that is useful to know.
It is helpful to express your income, expense and profit figures in both ‘per year’
and ‘per month’ bases (as two separate columns). For some expense categories
(such as food), it may be easier to estimate a ‘typical month’ and then multiply by
twelve to estimate the annual figure. For other expense categories (such as motor
vehicle registration and insurance), it may easier to estimate the total expense for
the year and then divide by twelve to estimate the ‘per month’ figure.
For your personal income (salary or wages), you can use either before or after-tax
income. If you use before-tax income, you should also include income tax as a
corresponding expense.
In most situations, your employer will have made contributions into your
superannuation account. Even though these payments are not part of your ‘cash
flow’, they are still a source of income. In most situations, 15% contributions tax is
taken out of these employer superannuation contributions. The total contribution is
income. The contributions tax is an expense.
If you received financial support from your parents and/or a scholarship, you should
include the amount that you received as income (with an appropriate
categorisation). If your parents gave you money in ‘instalments’, estimate the total
amount that they gave you over the last 12 months and then divide by twelve for
the average monthly amount.
Income should be categorised by the different sources, similar to the examples
covered in the Unit 1 course materials. You are welcome to customise these
categories for your own situation.
Your estimate of expenses should be broken down into categories such as ‘Rent’,
‘Food’ and ‘Transport’. If you are not sure about your expenses, try tracking them
over a month using a spreadsheet. A spreadsheet is provided under the
‘Spreadsheets’ link provided under the ‘Course Resources’ section of the course
website (Moodle).
You can choose your own expense categories but don’t include too many. For most
people, less than 5 categories doesn’t provide enough detail to understand your
expenses but more than 15 categories creates ‘information overload’. There are
some suggested categories in the course material (lecture) for Unit 1 but you can
customise these for your own situation.
If you live at home with your parents, better quality submissions will include your
share of various bills (such as electricity and food) in your calculation of expenses.
Whether or not you pay for these expenses yourself, they are still expenses that
you are incurring because you are using the service and are deriving a benefit from
that service. If your parents pay for your expenses on your behalf, then the amount
that your parents are subsidising you is a form of income (‘support from parents’).
For instance, if you incur $100 of educational expenses (an arbitrary number) and
your parents pay for the $100 on your behalf, two separate transactions have
occurred. You have incurred a $100 education expense and you have received a
$100 income from your parents (‘support from parents’). The net effect of these two
transactions on your profit is zero because the $100 in income is offset by the $100
in expenses.
Unit 1 covers the concept of depreciation, which is a measure of how an asset
decreases in value over time. Depreciation is an application of the ‘matching
principle’ in accounting, in which the expense is matched to the period in which the
benefit from the asset is recognised. Many assets decrease in value as a curve
(diminishing value), halving in value every X years. For example, if an asset is
purchased for $1000 and halves in value every 2 years, then it will be worth $500
after 2 years, $250 after 4 years and $125 after 6 years and so on. If you are not
sure how much something you own is worth, look it up on Ebay or Gumtree. The
current value of the asset can be placed on your balance sheet. Better quality
submissions will include estimates of depreciation on key assets as an expense
with a very brief explanation of how it was calculated. Note that some suggested
rates of depreciation for cars and notebook computers are included in the Unit 1
lecture slides, but you are welcome to make your own estimates. However, there
is no need to go overboard here. Only include depreciation for significant assets
that you are expected to use over many years (such as a motor vehicle or
computer). The purchase of smaller items is normally just treated as an expense at
the time of purchase.
Tuition fees are an expense whether you pay them directly, your parents pay for
them on your behalf or you defer payment by using a HECS or FEE-HELP loan
from the government. For example, let’s assume that your course fees are $100
per month (I’m using a ridiculously small number here for simplicity!). If you pay for
these yourself via your savings, the course fees are an expense of $100 per month
and your savings account (an asset) will decrease by $100 per month. If you defer
payment of the tuition fees by using a HECS loan, you have still incurred an
expense of $100 and your student loan (a debt) will increase by $100 per month. If
your parents pay for your tuition fees on your behalf, you have a tuition expense of
$100 and also an offsetting income support from parents of $100. In other words,
you will have a $100 expense no matter whether you pay for them yourself, defer
it onto a HECS or FEE-HELP loan or your parents pay for it on your behalf. If you
pay for the course fees yourself, your savings account (an asset on your balance
sheet) will decrease by $100. If you use HECS, a loan (a liability on your balance
sheet) will increase by $100. If your parents pay for your student fees, you will have
an income of $100 and there will be no change in your balance sheet.
For couples, there are two approaches that you can take with your income
statement: (1) keep your income and expenses completely separate and only
include your share of the income and expenses (like you are flatmates) or (2)
combine all of your income and expenses as one combined entity (like you are one
organisation). It is entirely up to you how you do this but most students who are in
a stable long-term relationship prefer option (2).
Balance Sheet
A balance sheet is a statement of your current assets, liabilities and equity (net wealth).
As discussed in Unit 1 of the course, a balance sheet is always measured at a point in
time. The key formula for a balance sheet is ‘assets less liabilities is equal to equity’.
Following are a few tips:
In the lecture material I emphasised that the profit on the income statement should
equal the change in equity on the balance sheet. However, if your income statement
does not