Personal Finance

Series
Pearson
Author
Jeff Madura  
Publisher
Pearson
Cover
Softcover
Edition
6
Language
English
Total pages
696
Pub.-date
January 2016
ISBN13
9780134082561
ISBN
0134082567
Related Titles



Description

For courses in Personal Finance.

 

A Hands-On Approach to Financial Planning

The main feature of Personal Finance is its hands-on approach keyed to the concepts students need to build their own financial plans. The text’s seven parts are all pieces of a financial plan; Chapter 21 is the capstone. A running example throughout the book and a variety of end-of-chapter cases reinforce the practical aspects of planning.

 

The Sixth Edition is fully updated with recent financial trends, such as lower interest rates, changing salaries, and rules for credit card use. With case studies and workable examples throughout, this book is an active tool students can use to become comfortable managing their finances into the future.  

 

Also available with MyFinanceLab

MyFinanceLab is an online homework, tutorial, and assessment program designed to work with this text to engage students and improve results. Within its structured environment, students practice what they learn, test their understanding, and pursue a personalized study plan that helps them better absorb course material and understand difficult concepts.

 

Students, if interested in purchasing this title with MyFinanceLab, ask your instructor for the correct package ISBN and Course ID. Instructors, contact your Pearson representative for more information.

 

Features

About the Book

 

The Latest Financial Data

  • REVISED! Information throughout has been revised to reflect current financial norms, such as salaries and credit card rules.
  • UPDATED! Chapter 1 contains more information on how to select a college or graduate school, major, and occupation based on financial goals. It also discusses salary information for potential careers and how to create a financial plan.
  • UPDATED! Chapter 5 on banking and interest rates contains more discussion on checking service, debit cards, mobile banking, checking account fees, and savings accounts.
  • UPDATED! Chapter 6 on managing money uses lower interest rates to reflect declining interest rates since the previous edition.
  • UPDATED! Chapter 7 on assessing and selecting your credit discusses student credit cards, credit bureaus, improving your credit score, and preventing identity theft in greater detail.
  • UPDATED! Chapter 8 on managing credit contains more information on secured and prepaid credit cards and rules for credit card issuers that protect users.
  • UPDATED! Chapter 9 on personal loans dives into the topics of peer-to-peer lending, warranty rules for car dealers, and student and home equity loans.
  • UPDATED! Chapter 10 on purchasing and financing a home now uses lower interest rates to reflect more realistic conditions, as well as a greater discussion of the impact of credit ratings on the ability to obtain a mortgage, new rules to ensure understandable mortgage contracts, and private mortgage insurance.
  • UPDATED! Chapter 16 on investing in bonds now uses lower interest rates to reflect realistic conditions.
  • UPDATED! Chapter 19 on retirement planning contains updated information on all of the different retirement plans available with recent changes.
  • REVISED! The Instructor’s Manual and Test Bank both reflect all chapter revisions.

Build Your Own Financial Plan

  • Personal Finance’s structure mirrors a comprehensive financial plan, teaching students the skills they need to build their own financial plan.
  • Building Your Own Financial Plan chapter-ending case studies are presented as an integrated series of exercises and worksheets that represent a portion of a financial plan. At the end of the course, students will have completed a financial plan that they can continue implementing beyond the school term.
  • A Certified Financial Planner exercise is contained in the last chapter (Chapter 21) and challenges students to offer advice on how financial planning should be adjusted in response to a change in economic conditions.

An Interactive Approach

  • Personal Finance’s interactive approach incorporates Internet-based resources along with many examples, problems, and ongoing case studies, all of which focus on providing students with hands-on practice applying financial concepts.
  • UPDATED! An Apps for Personal Finance feature highlights a wider array of useful apps students can download to their smartphones for free that apply to some of the key concepts covered in the chapter.
  • Financial Planning Online in every chapter highlights Internet resources for more information on a chapter topic. Each includes an Internet address and a description of what the website provides.
  • Financial Planning Problems require students to demonstrate knowledge of mathematically-based concepts to perform computations in order to make well-informed personal finance decisions. All Financial Planning Problems are available in MyFinanceLab.
  • Financial Planning Online Exercises show students how to obtain, critically evaluate, and use Internet-based resources in making personal finance decisions.

Real-life Scenarios

  • The text uses ongoing scenarios woven throughout all the chapters to illustrate the interdependence of personal finance decisions, including the following:
    • Examples. A running example throughout the text walks students through the financial story of the fictitious Stephanie Spratt, a recent college graduate and new entrant into the workforce. This continuous example helps students apply concepts to real-life scenarios.  
    • Building Your Own Financial Plan exercises prompt students to revise their goals, personal cash flow statement, and personal balance sheet to reflect their shifting priorities.
    • REVISED! The Sampsons case at the end of each chapter has been revised for consistency throughout the text, and how uses lower interest rates in examples to reflect realistic conditions of today. It allow students to plan for a family with two young children struggling to organize their finances.
    • REVISED! Part-ending Brad Brooks cases illustrate the adverse effects of poor financial decision-making, and have been revised for consistency throughout the text--using lower interest rates in examples to reflect the realistic conditions of today.

Learning Tools

  • Chapter Introductions provide an interest-grabbing scenario that previews the chapter’s content.
  • Learning Objectives corresponding to the main headings in each chapter, guide students through the material.
  • Explanation by Example. Practical examples applying concepts in realistic scenarios throughout chapters help cement student understanding.
  • Marginal Glossary. Throughout the text, key terms and their definitions appear in the text margin where they are first introduced.
  • UPDATED! Psychology of Personal Finance Boxed Features and Questions have been applied to additional situations, such as how spending attitudes can either ruin a budget or create wealth, or to explain how financial planning decisions are affected by psychology. An exercise at the end of each chapter asks students to evaluate if their personal finance decisions regarding a specific behavior discussed in the chapter is influenced by psychology.  
  • An Economic Impact logo identifies text that emphasizes how economic conditions can affect personal finance.
  • Summary. In paragraph form, the chapter summary presents the key points of the chapter to aid in student study.
  • Review Questions test students’ knowledge of the material by comparing and contrasting concepts, interpreting financial quotations, and understanding how financial data can be used to make personal finance decisions. All Review Questions are available in MyFinanceLab.
  • Ethical Dilemmas. Real-life ethical situations are presented along with questions to encourage students to think critically about ethics.
  • NEW! Web Search Exercises allow students to conduct an online search for real-world events related to the key content in each chapter.
  • Video Exercises. Students can review video clips on the main topics within each chapter and are asked to recommend a video clip that they believe would be most useful for other students. This encourages students to use critical thinking to offer their opinion and what they believe is the most important advice that should be passed on to other students.
  • Financial Literacy Tests. A pretest before Chapter 1 is provided so students can assess their current knowledge of personal finance before they begin the course. Then, a post test is provided after Chapter 21 so students can reassess their mastery of personal finance concepts. Answers are provided and follow each test.
  • Several projects are available in Appendix B:
    • Assessing Your Credit prompts students to evaluate their credit card balance and credit limit. It also guides students to obtain their credit score and to consider whether they should implement a strategy to pay down their existing credit balance.
    • Career Planning Project allows students to research a particular career that they plan to pursue and report on their research.
    • Leasing an Apartment allows students to assess the cost and potential benefits of leasing a particular apartment that they have identified.
    • Stock Market Project allows students to simulate the investing process, monitor a particular stock, and analyze how stock values respond to economic conditions.
    • Comparison Shopping. “Online Versus Local Purchases” allows students to compare the prices of products in stores versus online and to assess the pros and cons of purchasing products online.

Also available with MyFinanceLab

MyFinanceLab is an online homework, tutorial, and assessment program designed to work with this text to engage students and improve results. Within its structured environment, students practice what they learn, test their understanding, and pursue a personalized study plan that helps them better absorb course material and understand difficult concepts.

  • A fully functional financial calculator. Students now have access to a fully functional financial calculator inside MyFinanceLab, along with free access to the new financial calculator app they can download to their iPhone®, iPad®, or Android device.
  • MyFinanceLab Video Series illustrate key topics including:
    • Default Risk
    • Market Efficiency
    • Diversification
    • Mutual Fund Performance
    • Castle in the Air Theory
    • Stocks 101/Intro to Stocks
  • Worked Solutions provide step-by-step explanations on how to solve select problems using the exact numbers and data that were presented in the problem. Instructors will have access to the Worked Solutions in preview and review mode.
  • Adaptive Learning Study Plan (Powered by Knewton). Not every student learns the same way and at the same rate. And now, thanks to advances in adaptive learning technology, you no longer have to teach as if they do. MyFinanceLab assesses student performance and activity in real time and, using data and analytics, personalizes content to reinforce concepts that target each student’s strengths and weaknesses. 
    • Dynamic Study Modules help students study effectively on their own by continuously assessing their activity and performance in real time. Here's how it works: students complete a set of questions with a unique answer format that also asks them to indicate their confidence level. Questions repeat until the student can answer them all correctly and confidently. Once completed, Dynamic Study Modules explain the concept using materials from the text. These are available as graded assignments prior to class, and accessible on smartphones, tablets, and computers.
  • Learning Catalytics is an interactive, student response tool that uses students’ smartphones, tablets, or laptops to engage them in more sophisticated tasks and thinking. Now included with MyFinanceLab with eText, Learning Catalytics enables you to generate classroom discussion, guide your lecture, and promote peer-to-peer learning with real-time analytics. Instructors, you can:
    • Pose a variety of open-ended questions that help your students develop critical thinking skills.
    • Monitor responses to find out where students are struggling.
    • Use real-time data to adjust your instructional strategy and try other ways of engaging your students during class.
    • Manage student interactions by automatically grouping students for discussion, teamwork, and peer-to-peer learning.
  • UPDATED! Question format enhancements:
    • Expression: Provides a math palette for students to enter responses.
    • Multiple/many choice: Allows images in the individual answer responses.
    • Word cloud: Helps students understand phrases in addition to individual words.
    • Region: Allows students to enter multiple dots at once.
    • Direction: Allows students to draw arrows that are not all anchored in the same place.
  • Reporting Dashboard. View, analyze, and report learning outcomes clearly and easily, and get the information you need to keep your students on track throughout the course, with the new Reporting Dashboard. Available via the MyFinanceLab Gradebook and fully mobile-ready, the Reporting Dashboard presents student performance data at the class, section, and program levels in an accessible, visual manner.
  • Homework and Media Assignment Enhancement. The assignment manager now allows instructors to include media on any type of homework, including homework assignments. The filter bar that toggles between questions and media has been added to the homework question-selection page, and the setting requiring students to work the media before answering questions is also available. This will allow instructors to more readily combine media and end of chapter questions together in assignments, ensuring that students use the media resources available to them.
  • UPDATED! HTML5 Player. In addition to matching the Flash player’s support of Accessibility requirements, the HTML5 player has a new “Show Work” feature to allow students to enter text either from a keyboard or stylus and to draw freehand on different backgrounds, such as a coordinate graph, with multiple fonts and colors. Students can also continue to upload images such as phone-photos of handwritten work. Printing enhancements include:
    • a more pen-and-paper-friendly layout of exercises
    • the ability for instructors to choose whether to print the header; to include an honor statement; and to print with answers inline, after each question, or on a separate sheet
  • Mobile Player. Students and instructors will be able to access multimedia resources and complete assessments right at their fingertips, on any mobile device. Highlights of Pearson's MyFinanceLab Mobile Player:
    • Works on mobile devices and tablets, as well as laptop and desktop computers
    • Fresh and intuitive design
    • Compatible with browser-based magnification settings

New to this Edition

About the Book

 

The Latest Financial Data

  • REVISED! Information throughout has been revised to reflect current financial norms, such as salaries and credit card rules.
  • UPDATED! Chapter 1 contains more information on how to select a college or graduate school, major, and occupation based on financial goals. It also discusses salary information for potential careers and how to create a financial plan.
  • UPDATED! Chapter 5 on banking and interest rates contains more discussion on checking service, debit cards, mobile banking, checking account fees, and savings accounts.
  • UPDATED! Chapter 6 on managing money uses lower interest rates to reflect declining interest rates since the previous edition.
  • UPDATED! Chapter 7 on assessing and selecting your credit discusses student credit cards, credit bureaus, improving your credit score, and preventing identity theft in greater detail.
  • UPDATED! Chapter 8 on managing credit contains more information on secured and prepaid credit cards and rules for credit card issuers that protect users.
  • UPDATED! Chapter 9 on personal loans dives into the topics of peer-to-peer lending, warranty rules for car dealers, and student and home equity loans.
  • UPDATED! Chapter 10 on purchasing and financing a home now uses lower interest rates to reflect more realistic conditions, as well as a greater discussion of the impact of credit ratings on the ability to obtain a mortgage, new rules to ensure understandable mortgage contracts, and private mortgage insurance.
  • UPDATED! Chapter 16 on investing in bonds now uses lower interest rates to reflect realistic conditions.
  • UPDATED! Chapter 19 on retirement planning contains updated information on all of the different retirement plans available with recent changes.
  • REVISED! The Instructor’s Manual and Test Bank both reflect all chapter revisions.

An Interactive Approach

  • UPDATED! An Apps for Personal Finance feature highlights a wider array of useful apps students can download to their smartphones for free that apply to some of the key concepts covered in the chapter.

Real-life Scenarios

  • The text uses ongoing scenarios woven throughout all the chapters to illustrate the interdependence of personal finance decisions, including the following:
    • REVISED! The Sampsons case at the end of each chapter has been revised for consistency throughout the text, and how uses lower interest rates in examples to reflect realistic conditions of today. It allow students to plan for a family with two young children struggling to organize their finances.
    • REVISED! Part-ending Brad Brooks cases illustrate the adverse effects of poor financial decision-making, and have been revised for consistency throughout the text--using lower interest rates in examples to reflect the realistic conditions of today.

Learning Tools

  • UPDATED! Psychology of Personal Finance Boxed Features and Questions have been applied to additional situations, such as how spending attitudes can either ruin a budget or create wealth, or to explain how financial planning decisions are affected by psychology. An exercise at the end of each chapter asks students to evaluate if their personal finance decisions regarding a specific behavior discussed in the chapter is influenced by psychology.  
  • Web Search Exercises allow students to conduct an online search for real-world events related to the key content in each chapter.

Also available with MyFinanceLab

MyFinanceLab is an online homework, tutorial, and assessment program designed to work with this text to engage students and improve results. Within its structured environment, students practice what they learn, test their understanding, and pursue a personalized study plan that helps them better absorb course material and understand difficult concepts.

  • UPDATED! Question format enhancements:
    • Expression: Provides a math palette for students to enter responses.
    • Multiple/many choice: Allows images in the individual answer responses.
    • Word cloud: Helps students understand phrases in addition to individual words.
    • Region: Allows students to enter multiple dots at once.
    • Direction: Allows students to draw arrows that are not all anchored in the same place.
  • UPDATED! HTML5 Player. In addition to matching the Flash player’s support of Accessibility requirements, the HTML5 player has a new “Show Work” feature to allow students to enter text either from a keyboard or stylus and to draw freehand on different backgrounds, such as a coordinate graph, with multiple fonts and colors. Students can also continue to upload images such as phone-photos of handwritten work. Printing enhancements include:
    • a more pen-and-paper-friendly layout of exercises
    • the ability for instructors to choose whether to print the header; to include an honor statement; and to print with answers inline, after each question, or on a separate sheet

Table of Contents

Preface

Financial Literacy Pre-Test

1. Overview of a Financial Plan

 

PART 1: TOOLS FOR FINANCIAL PLANNING

2. Planning with Personal Financial Statements

3. Applying Time Value Concepts

4. Using Tax Concepts for Planning

 

PART 2: MANAGING YOUR LIQUIDITY

5. Banking and Interest Rates

6. Managing Your Money

7. Assessing and Securing Your Credit

8. Managing Your Credit

 

PART 3: PERSONAL FINANCING

9. Personal Loans

10. Purchasing and Financing a Home

 

PART 4: PROTECTING YOUR WEALTH

11. Auto and Homeowner’s Insurance

12. Health and Disability Insurance

13. Life Insurance

 

PART 5: PERSONAL INVESTING

14. Investing Fundamentals

15. Investing in Stocks

16. Investing in Bonds

17. Investing in Mutual Funds

18. Asset Allocation

 

PART 6: RETIREMENT AND ESTATE PLANNING

19. Retirement Planning

20. Estate Planning

 

PART 7: SYNTHESIS OF FINANCIAL PLANNING

21. Integrating the Components of a Financial Plan

 

Financial Literacy Post-Test

Appendix A: Your Career

Appendix B: Projects

Appendix C: Financial Tables

Index

Credits