Published: December 2018
Page Count: 430
ISBN (Digital): 978-1-4533-9201-0

Personal Finance

Version 3.0
By Rachel S. Siegel

Included Supplements

Homework

Manual

Slides

Tests

Key Features

Includes clear learning objectives, key takeaways, and exercise problems in each section.
Includes personal finance planning problems, solutions, and exercises.
Includes links to videos, blogs, and other external applications.
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This textbook is suitable for the following courses: Personal Finance

Personal Finance was written with two simple goals in mind: to help students develop a strong sense of financial literacy and to provide a wide range of pedagogical aids to keep them engaged and on track. This book is a practical introduction that covers all of the fundamentals and introduces conceptual frameworks in a way that students can grasp and use in their personal lives.

New in This Version

Updated to reflect changes in tax code.
Updated figures, statistics, references, and links.
Refreshed photos and artwork.
Expanded explanation of math steps and calculations.
More in-depth discussion of exchange traded funds (ETFs).

1.1 Introduction

1.2 Individual or “Micro” Factors That Affect Financial Thinking

1.3 Systemic or “Macro” Factors That Affect Financial Thinking

1.4 The Planning Process

1.5 Financial Planning Professionals

Chapter 2: Basic Ideas of Finance

2.1 Introduction

2.2 Income and Expenses

2.3 Assets

2.4 Debt and Equity

2.5 Income and Risk

Chapter 3: Financial Statements

3.1 Introduction

3.2 Accounting and Financial Statements

3.3 Comparing and Analyzing Financial Statements

3.4 Accounting Software: An Overview

Chapter 4: Evaluating Choices: Time, Risk, and Value

4.1 Introduction

4.2 The Time Value of Money

4.3 Calculating the Relationship of Time and Value

4.4 Valuing a Series of Cash Flows

4.5 Using Financial Statements to Evaluate Financial Choices

4.6 Evaluating Risk

Chapter 5: Financial Plans: Budgets

5.1 Introduction

5.2 The Budget Process

5.3 Creating the Comprehensive Budget

5.4 The Details of Budgeting and Specialized Budgets

5.5 Budget Variances

5.6 Budgets, Financial Statements, and Financial Decisions

Chapter 6: Taxes and Tax Planning

6.1 Introduction

6.2 Sources of Taxation and Kinds of Taxes

6.3 The U.S. Federal Income Tax Process

6.4 Record Keeping, Preparation, and Filing

6.5 Taxes and Financial Planning

Chapter 7: Financial Management

7.1 Introduction

7.2 Your Own Money: Cash

7.3 Your Own Money: Savings

7.4 Other People’s Money: Credit

7.5 Other People’s Money: An Introduction to Debt

Chapter 8: Consumer Strategies

8.1 Introduction

8.2 Consumer Purchases

8.3 A Major Purchase: Buying a Car

Chapter 9: Buying a Home

9.1 Introduction

9.2 Identify the Product and the Market

9.3 Identify the Financing

9.4 Purchasing and Owning Your Home

Chapter 10: Personal Risk Management: Insurance

10.1 Introduction

10.2 Insuring Your Property

10.3 Insuring Your Health

10.4 Insuring Your Income

Chapter 11: Personal Risk Management: Retirement and Estate Planning

11.1 Introduction

11.2 Retirement Planning: Projecting Needs

11.3 Retirement Planning: Ways to Save

11.4 Estate Planning

Chapter 12: Investing

12.1 Introduction

12.2 Investments and Markets: A Brief Overview

12.3 Investment Planning

12.4 Measuring Return and Risk

12.5 Diversification: Return with Less Risk

Chapter 13: Behavioral Finance and Market Behavior

13.1 Introduction

13.2 Investor Behavior

13.3 Market Behavior

13.4 Extreme Market Behavior

13.5 Behavioral Finance and Investment Strategies

Chapter 14: The Practice of Investment

14.1 Introduction

14.2 Investment Information

14.3 Investing and Trading

14.4 Ethics and Regulation

14.5 Investing Internationally: Risks and Regulations

Chapter 15: Owning Stocks

15.1 Introduction

15.2 Stocks and Stock Markets

15.3 Stock Value

15.4 Common Measures of Value

15.5 Equity Strategies

Chapter 16: Owning Bonds

16.1 Introduction

16.2 Bonds and Bond Markets

16.3 Bond Value

16.4 Bond Strategies

Chapter 17: Investing in Mutual Funds, Commodities, Real Estate, and Collectibles

17.1 Introduction

17.2 Mutual Funds

17.3 Real Estate Investments

17.4 Commodities and Collectibles

Chapter 18: Career Planning

18.1 Introduction

18.2 Choosing a Job

18.3 Finding a Job

18.4 Leaving a Job

Appendix A: Present Value and Future Value Tables

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Instructor’s Manual

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Rachel S. Siegel

Northern Vermont University

Rachel S. Siegel (MBA Yale University, CFA) was a professor of finance, economics, and accounting at Vermont State University from 1990–2016. She has also taught as an adjunct faculty member at Trinity College (Vermont), Granite State College (New Hampshire), Springfield College (Massachusetts), the University of Vermont, and in Tel Aviv, Israel, for Champlain College. Rachel has been a consultant to the CFA Institute on exam development, data forensics, and curricula, and has consulted on various exam prep courses in finance. She has also developed a freelance career as a financial editor and writer, for both investment firms and academics. Her column “Follow the Money” has been a regular feature of the Northstar Monthly since 2001. Originally from Providence, Rhode Island, Rachel now lives in Barnet, Vermont.

Additions & Errata

9/25/23: Incorrect table values updated in tables 4.9–4.13.