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Personal Financial Planning (EBFV201)

This module is presented as follows in 2024:
  • SUMMERSTRAND CAMPUS SOUTH: Full-Time (A1)

    Can be used as a major: No
    Offered in: Term 1+2
    Credit value: 16
    Estimated fees: R5000
    Lecturer: PANDIE, R

  • SUMMERSTRAND CAMPUS SOUTH: Full-Time (A7)

    Can be used as a major: No
    Offered in: Term 1+2
    Credit value: 16
    Estimated fees: R5000
    Lecturer: PANDIE, R

  • SUMMERSTRAND CAMPUS SOUTH: Part-Time (A2)

    Can be used as a major: No
    Offered in: Term 1+2
    Credit value: 16
    Estimated fees: R5000
    Lecturer: PANDIE, R

Syllabus

PURPOSE

The overall module objective is to equip students with a broad perspective of the fundamentals of personal financial planning, with specific reference to the following key areas of personal financial planning:
• the financial services environment and related legislation;
• the Financial Services Board and other regulatory bodies;
• asset types;
• short-term insurance;
• long-term insurance;
• retirement fund types and the six-step financial planning process.

LEARNING OUTCOMES

Introduction to Financial Planning
• Understand and explain the fundamentals of financial planning.
• Identify the main role-players in the financial planning environment.
• Discuss the other role-players in the financial services industry.
• Understand and discuss the main consumer protection bodies in the industry.
• Demonstrate an understanding of the factors influencing the financial planning environment.
• Demonstrate an understanding of the role of the Financial Services Board.
• Identify and discuss the main acts administered by the FSB.
Asset Types
• Understand money market instruments.
• Compare and demonstrate an understanding of the various money market products.
• Discuss the advantages and disadvantages of investing in money market instruments.
• Understand capital market investments.
• Demonstrate an understanding of the difference between interest-bearing and discounted investments.
• Calculate the purchase price of a bond in the secondary market.
• Explain what is meant by equities.
• Discuss the requirements for listing on the various boards of the JSE.
• Recognise the difference between various types of shares available in the market.
• Explain how to read the prices in the newspapers.
• Understand how to value an equity investment.
• Understand risk and return in relation to equity investments.
• Understand the basic tax implications of investing in equity instruments.
• Recognise the different property portfolios available to the investor.
• Identify the advantages and disadvantages of investing in property.
• Understand the tax implications of investing in property.
• Discuss the types of hard assets.
• Demonstrate an understanding of liquidity, risk and return.
• Demonstrate an understanding of derivatives, futures and options.
• Compare the advantages and disadvantages of using the various instruments.
• Demonstrate an understanding of the principles of trading futures and options.
Investment Products
• Demonstrate an understanding of the operation and types of collective investment schemes.
• Understand unit trusts and the use of them.
• Understand the various retirement fund options.
• Explain the difference between insurance and assurance.
• Understand life assurance and the various life assurance and ancillary products in the market.
• Demonstrate an understanding of offshore investments and the reasons for investing offshore.
Short-term Insurance
• Understand the basics of insurance.
• Differentiate between personal accident insurance and sickness insurance.
• Understand and discuss the different classes of motor insurance.
• Explain fire insurance and other property insurance.
• Understand and discuss theft and all risks insurance.
• Describe the different types of liability insurance and indemnity insurance.
• Explain multi-peril insurance.
Long term Insurance
• Understand the main provisions of the Long Term Insurance Act.
• Explain the technical aspects of long-term insurance policies.
• Explain the taxation of life insurance companies and funds.
• Discuss the provision of disability benefits.
Retirement Funds
• Demonstrate an understanding of the differences between pension and provident funds.
• Explain the different types of pension and provident funds.
• Explain the difference between defined benefit and defined contribution funds.
• Understand preservation funds.
Six Steps of Financial Planning
• Understand and discuss the compliance requirements when establishing a professional relationship.
• Discuss the information and data gathering process.
• Explain information and data analysis.
• Describe the process of preparing and presenting recommendations.
• Discuss the implementation stage of the planning process.
• Explain the process of review and monitoring.

CORE CONTENT

• The Financial Services Environment and related legislation:
o Rudiments of the SA Financial System.
o Financial Intermediation.
o Financial Intermediaries in SA.
o Other financial bodies.
• The Financial Services Board and Regulatory bodies:
o Focusing on legislation related to the financial services industry.
• Asset types:
o Introduction to the different asset types.
o Risk inherent in these assets.
o Taxation issues relating to the various asset types.
o Long-term and short-term products which could be formed by combining different asset classes.
• Short-Term Insurance.
• Long-Term Insurance.
• Retirement Fund Types.
• Six Steps of Financial Planning.

Evaluation criteria

100% Continuous assessment:

• 2x Semester tests (Final mark weight = 40%)
• 3x Tutorials (Final mark weight = 15%)
• 1x Assignment (Final mark weight = 15%)
• End of module assessment (Final mark weight = 30%)

MODERATION

Internal.

Prerequisites

• Mathematics For Accounting (MACV101) OR Financial Mathematics (STAV101)
• Business Statistics I (STAV102)

 

 

Evaluation criteria

Evaluation criteria 

100% Continuous assessment:

• 2x Semester tests (Final mark weight = 40%)
• 3x Tutorials (Final mark weight = 15%)
• 1x Assignment (Final mark weight = 15%)
• End of module assessment (Final mark weight = 30%)

 

Prerequisites needed for this module

  • Mathematics For Accounting  (MACV101)
  • Business Statistics I  (STAV102)