Personal Financial Planning

The attainment of financial freedom is a goal that is shared by the
entire human race. This is especially considering the fact that it has a
bearing on or it determines the quality of life that an individual would
lead, both in the present and the future. Financial freedom, however, is
determined by how wise an individual is in the management of his money.
Scholars have underlined the importance of setting financial goals in
the wise management of money, as it lays down the framework for
decisions pertaining to saving and individual expenditure. Indeed, early
long-term goal setting, investing, saving, education, budgeting,
training, as well as wise decisions on expenditure would go a long way
in safeguarding the attainment of future financial freedom. Financial
goals are often categorized into three groups including short-term,
intermediate and long-term. Short-term financial goals refer to those
that an individual can achieve within less than a year. It is worth
noting that some crucial short-term financial goals may not enhance an
individual`s financial position in the current year but would be crucial
in setting him or her on the path to enhancing their wealth and
financial position in the long-term. Long-term goals, on the other hand,
would be achieved in a period of 3 years and above. They may entail both
short-term goals, as well we intermediate financial goals. For the
student in this case, various short-term and long-term goals may be
Short-term goals
The short-term goals for the student would include buying a car and
taking a vacation. On the same note, the student would need to determine
the amount to be saving every month so as to allow for the attainment of
the long-term financial goals. In addition, he aims obtaining an
entry-level Job in Waikiki-International Market Place as International
Relations Officer, with an income of $40000. With an income of $40000
per year, it would be recommended that the student makes it his goal
that he saves at least 10% of the income, in which case $4000 should go
to saving.
Long-term financial goals
For this student, the long-term financial goals would revolve around
owning a home in Hawaii, getting married and owning a car. In addition,
it is worth noting that he has already accumulated a student loan of
$40,000, which he would need to clear off in the long-term (within the
next ten-years) alongside any credit card loans that he may accumulate
(Stovall & Maurer, 2011). As a replacement for the loans and credit
cards, it would be imperative that the student sets up an emergency fund
account. One of the most crucial long-term goal revolves around saving
for one’s retirement. The amount to be saved within this time should
be ascertained, alongside the required time for retirement.
Recommendations for attaining short-term and Long-term goals
The attainment of short-term and long-term goals involves a tradeoff
between the varied goals, as well as the prioritization of the items
that an individual needs to achieve within certain duration.
First, the student should strive to become employed so as to improve his
earnings. This would allow him to obtain a realistic picture as to the
course of his financial journey, his saving potential, as well as the
percentage of money that he should allocate to what projects (Stovall &
Maurer, 2011). While he is hoping to obtain an entry-level job that pays
about $40000 annually, there are chances that he will get one that pays
considerably less amount. In essence, it would be imperative that he
supplements his income with part-time jobs.
Second, it would be imperative that the student applies for United
States citizenship or obtains a green card or resident status. This
would go a long way in enhancing his capacity to obtain a job, as well
as improving his earning potential. Indeed, research shows that
non-residents are paid considerably low salaries compared to their
resident counterparts.
Third, as a non-resident, it is possible that his student loan has a
higher rate of interest compared to that of nonresidents. Indeed, loans
for non-residents have an interest rate ranging from 5.9% to 6.8%, while
the Senate approved the revision of loans for residents to 3.9% and, in
some instances, 1.9%. In essence, he could look for another loan that
attracts a lesser amount of interest and pay off the student loan,
thereby making some savings in the long-term (Stovall & Maurer, 2011).
Lastly, saving for a home or a car in the long-term may prove
impossible when an individual has to personally make the deductions. In
this case, setting up an account and making the deductions automatic
would be imperative as this complements efforts at saving in the
Economic and Personal Conditions to be considered
While these financial goals have a high likelihood for being attained,
some economic conditions may hamper their achievement. First, the
current economic conditions may not only allow for reduced salaries and
benefits, but also reduce the chances of getting employed. The
nonresident status of this student makes it even more difficult as he
may attract even lower salaries and benefits. On the same note, he may
not know people especially in the job market, in which case his chances
of employment become even slimmer.
Additional Courses of Action
Considering that the attainment of financial goals is currently tied to
obtaining a job, it would be imperative that the student focuses not
only on the full-time employment but also part-time jobs that may be
available. Indeed, volunteering would also go a long way in enhancing
his curriculum vitae and building connections that would increase his
chances of getting a better job, not to mention the experience and
people skills that come with such jobs (Stovall & Maurer, 2011).
Stovall, J., & Maurer, T. (2011). The ultimate financial plan: Balancing
your money and life. Hoboken, N.J: Wiley.

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