Hello everyone, welcome to our presentation.

Today, we are going to present about the role

of finance that is of great interest to many people, my group has 5 members who are Bảo
Hân, Hiền, V.Anh, T.Anh, and Q.Giao.
Before going into this topic I have some questions for the groups:
What do you usually use the money for? (I will give you two minutes to answers this
question)
After listening to your answers, we can see that the role of finance in our lives is very
important, financial stability helps us not to be under economic pressure, have a good life,
eat well, dress well, bring the best quality of life, happiness, and peace.
And now I have another question for you guys:
What do you usually use lucky money for?
As for me, I usually use that money to save or buy things that I love or want to buy for a long
time.
Do you know how to save money?
In my opinion, we should save money because it helps us control how much we spend so that
spending does not exceed our personal income, only buying products and services that are
really necessary and suitable for our needs. The amount of money you have

(Welcome to Developing Your Spending Plan. During our time together today we’re going to talk
about your financial goals and the importance of having a written plan to help you obtain your goals.
We’ll make sure you understand the components of the Financial Planning Worksheet, how to
complete it, and how to find some solutions to your financial challenges. Finally, we’ll discuss some
sources of help that are available. Although you won’t actually complete your financial plan today
because you probably didn’t come in with all of the information you need, you will leave with all the
tools you need to complete a plan. Make sure and take lots of notes on your handouts link tham khảo
https://www.9thmcd.marines.mil/Portals/82/Docs/Developing%20Your%20Spending%20Plan
%20Main%20Module.pdf)

1. Do you have a budget?

A) yes 10 points

B) no 0 points

2. Based on four weeks pay per month, how much of your take-home pay goes toward
rent/mortgage and utilities?

A) Under 30% 10 points

B) 35% 5 points
 C) 40% or more 0 points

3. Total the monthly amount due on all credit cards, charge accounts, loans (including auto,
personal, second mortgage, etc.). What percent of your monthly (4 week) take-home pay
does this represent?

A) 15% or less 10 points

B) 20% 5 points

C) 40% or more 0 points

4. Do you have an individual retirement plan?

A) yes 10 points

B) no 0 points

5. How many credit cards and / or charge accounts do you have?

A) 5 or less 10 points

B) six to eight 5 points

C) nine or more 0 points

6. Which answer best typifies your credit and/or charge accounts?

A) Paid in full every month 10 points

B) Pay more than minimum due monthly 5 points

C) Pay the minimum each month 0 points

7. Do you pay your bills on time?

A) Always 10 points

B) Usually 5 points

C) Seldom 0 points

8. How much of your monthly (4 week) take-home pay do you save?

A) Less than 10% or none 0 points

B) 10% 5 points

C) More than 10% 10 points

9. How much cash do you have on hand in savings and other liquid assets?

A) one week’s pay or none 0 points

B) one month’s pay 5 points

C) Two month’s pay or more 10 points

 10. Do you need a second job or use your savings to pay monthly bills or expenses?

A) Never 10 points

B) Occasionally 5 points

C) Often 0 points

TOTAL

75 – 100 points Top money manager.

50 – 74 points OK, but be careful.

Under 50 points Beware, you may have some problems!

SOME QUESTION

Are there any unexpected expenditures/revenues?

How is our cash flow? Are we paying our bills on time?

How do we look as we approach year end?

Benefits role of finance

Some of the benefits of planning are:

• You have more money and financial security.

• You know how to use money to achieve your goals.

• You have less chance of going into debt you cannot handle.

• You can help your partner and support your children, if you have a family.

Whether you are spending, saving, or investing money, planning can help you to make big or small
financial decisions.

1.2 FINANCE FUNCTION– IMPORTANCE

In general, the term “Finance” is understood as provision of funds as and when needed. Finance
is the essential requirement –sine qua non– of every organisation.

Required Everywhere: All activities, be it production, marketing, human resources development,

purchases and even research and development, depend on the adequate and timely availability
of finance both for commencement and their smooth continuation to completion. Finance is
regarded as the life-blood of every business enterprise.

Efficient Utilisation More Important: Finance function is the most important function of all
business activities. The efficient management of business enterprise is closely linked with the
efficient management of its finances. The need of finance starts with the setting up of business.
 Its growth and expansion require more funds. The funds have to be raised from various sources.
The sources have to be selected keeping in relation to the implications, in particular, risk
attached. Raising of money, alone, is not important. Terms and conditions while raising money
are more important. Cost of funds is an important element. Its utilisation is rather more
important. If funds are utilised properly, repayment would be possible and easier, too. Care has
to be exercised to match the inflow and outflow of funds. Needless to say, profitability of any firm
is dependent on its cost as well as its efficient utilisation.

Role of the Finance Committee

The role of the finance committee is primarily to provide financial oversight for the organization.
Typical task areas for small and midsized groups include budgeting and financial planning, financial
reporting, and the creation and monitoring of internal controls and accountability policies. An outline
of responsibilities appears below.
EXAMPLE OF FINANCE IF NECESSARY
Consumer Spending

Erik will probably spend most of his $2,000 of monthly disposable income on the goods and services
we typically think of as consumer spending, but Erik has an economic problem — a scarcity problem
to be exact. He cannot possibly buy all the goods and services he wants with his limited income. He
must make choices. How will Erik know if he is making the “right” consumer choices?

One thing is certain — people are different and have a wide variety of tastes and preferences when it
comes to consumer purchases. Economists don’t typically differentiate between economic “needs”
and “wants.” For example, is a car a need or a want? Some might say it is more of a want, and that
many people should walk or ride a bicycle instead of purchasing a car. But it’s really not that clear
since some people live far from work, aren’t able to walk to places very easily, engage in many
activities in different locations, live in very cold climates, etc. Then what about a large “gas guzzler?”
Surely this must be a “want;” people don’t need gas guzzlers. But there are actually many reasons
people choose to have a larger car. Larger cars may be safer, are usually more comfortable, hold
more people, can haul heavier loads, etc.

Because of the subjective nature of consumer decisions, economics places more emphasis on helping
people think through the opportunity cost of their consumer decisions. For example, if Erik is thinking
about purchasing a large new car instead of a smaller used one, has he considered what other goods
and services he will not be able to purchase as a result? Maybe he won’t be able to take a vacation or
purchase some video games or clothes. Scarcity is real, and all of us have to make tough purchasing
decisions. Economics helps people think through the true opportunity cost of their decisions.

If Erik follows these steps, he will be much more likely to make wise consumer choices.
 Major Steps in Making a Purchase Decision
1. Identify what you want.
• Set priorities.
• Avoid impulse buying.
2. Determine how much you can or want to spend.
• Develop a budget and stick with it.
3. Find out what products or services are available in your price range.
• Check store ads.
• Ask your friends.
• Consult consumer magazines and web sites.
• Visit on-line vendors.
4. Choose the features you would most want to have.
• List specific characteristics/features the product or service must have and
those that would be nice to have.
• List the characteristics/features you definitely do not want.
5. Use a decision-making grid to analyze the alternatives.
• Use + (plus) for alternatives that have a desired feature, - (minus) for
alternatives without the feature.
• Tally the plusses to determine the best choice.
6. Watch out for hidden costs.
• Check the sales tax. (Sales tax varies by community.)
• Check for delivery costs or costs of required accessories.
7. Make your choice.

FOR MORE EXAMPLE https://www.uttyler.edu/ceefl/files/what-personal-finance-is-about-financial-

decision-making.pdf