PRACTICAL FINANCIAL MODEL FOR WOMEN

ENTREPRENEURS

Zuma Hall - Rockview Hotel Royale, Abuja

A Financial Planning Approach

Venue:

Tuesday, 25th November, 2008

Date:

Presented by: Rev. Eric Ighalo

WELCOME TO NNEW - ABUJA

Since 2006…..a.personal testimony.

Profitable Partnerships…..Mssers.Odunsi,Situ,Ehirim..

Demonstrating Commitment and belief….

Some Comments

VISION-Building generations of successful women entrepreneurs.

ERIC IGHALO & PARTNERSERIC IGHALO & PARTNERS

FINANCIAL SELF APPRAISAL FORMFINANCIAL SELF APPRAISAL FORM

Do you know your present financial condition or networth?Are you satisfied with your present financial condition?Are you aware of the simple ways to increase your networth?Do you have enough savings to see you through six months of normal living expenses?Do you save money on a regular basis?Have you formed the habit of saving a part of your income every month?Do you have well defined personal financial goals?Do you reconcile your bank statements monthly?Do you know how much you spend specifically each month?Do you keep record of your income & expenditure?Do you spend less than you earn?Are you successful at managing your household budget?Do you avoid major credit purchase?Do you take advantage of all company sponsored savings/investment Programmes?Do you have any investment that help to reduce your taxable income?Do you diversify your investments?Are you satisfied with the contributions from your investments to your total income?Do you have a brilliant financial adviser or team of advisers?Do you feel you have sufficient permanent life insurance coverage?Have you planned for your children’s college education?Do you own a house?Do you have a plan to retire in comfort?Have you prepared a will?Are you in control of your financial future?Are you satisfied with the contribution you have made to the world?

SCORING

If total number marked “No” or “I Don’t Know is between:

0-4 = you are in good shape. Keep the good work

5-10 = on the right track, but you need to improve

11-12 = weak pulse. Urgent remedial action required.

YESYES NONOI DON’TI DON’T

KNOWKNOW

Courtesy IFP

FINANCIAL PLANNING-Definition

This is a process of defining your financial goals,developing and implementing a plan of action to achieve them.

THREE KEY QUESTIONS?

Where do I want to be in the future?Where am I now….? And How(in practical terms)do I get do I get there?

THE NETWORTH STATEMENT

Assets: Is something that brings money to your pocket

Liabilities: Is something that takes money out of your pocket

NETWORTH = Assets – Liabilities

MALLAM & MRS. HARUNA & JUMAI CONGOStatement of Financial Position as at 31st October,

2008

ASSETS LIABILITIES AND NETWORTH

Liquid Assets =N= % Liabilities =N= %

Cash in hand 80,100 0.6 Credit card balance 75,340 0.6savings Account 220,000 1.6 Car loan 900,000 6.6Current Account 44,000 0.3 Share loan 654,000 4.8Money market Fund 1,380,000 10.1 Lease Obligation 360,000 2.6Total Liquid Assets 1,724,100 12.6 Mortgage loan balance 2,600,000 19.0

Total Liabilities 4,589,340 33.6

Investment Assets

Stocks 2,240,000 16.4Retirement Benefits 1,434,000 10.5Total Invest. Assets 3,674,000 26.9

Networth 9,078,760 66.4

Personal Assets

Residence 4,200,000 30.7Country Home 1,320,000 9.7Cars 1,800,000 13.2Furniture & Equip. 710,000 5.2Miscellaneous Property 240,000 1.7Total personal Assets 8,270,000 60.5

TOTAL LIABILITIES &TOTAL ASSETS 13,668,100 100.0 NETWORTH 13,668,100 100.0

THE NETWORTH CONCEPTMALLAM & MRS. HARUNA & JUMAI CONGO

Showing Interest Rates

INCOME =N= =N= =N= %

Salaries 1,680,000 84.6 Dividend Income 132,400 6.7 Interest on Savings and other deposits 172,000 8.7

1,984,400 100.0

EXPENDITURE

Savings and Investments 200,000 10.1 Fixed Expenditure

Mortgage loan payments 267,520.00 13.7 Insurance premiums 52,440.00 2.7

319,960 16.4

Variable Expenditure

Income Taxes 184,800.00 9.5 Food 216,000.00 11.1 Transportation 124,800.00 6.4 Utilities/Household expenses 176,800.00 9.1 Entertainment/Vacation 209,800.00 10.8 Education Expenses 201,360.00 10.3 Clothing/Personal care 190,000.00 9.7 Medical/Dental care 68,000.00 3.5Miscelleneous 59,400.00 3.0 Total variable expenditure 1,430,960 73.3

TOTAL EXPENDITURE 1,950,920 98.3

EXCESS OF INCOME OVER EXPENDITURE 33,480 1.7

INCOME AND EXPENDITURE STATEMENTDEACON ADEDAYO FAMILY

For the year ended 31st December, 2005.

MADAM BINTA’S FAMILYINCOME & EXPENDITURE STATEMENTFor the year ended 31st October, 2008

EIGHT REASONS EIGHT REASONS PEOPLE FAIL PEOPLE FAIL FINANCIALLYFINANCIALLY

1. Incorrect beliefs and myths about money2. Procrastination.3. Failure to make money a priority by responsibly managing the resources we already possess.4. Failure to establish financial goals.5. Failure to develop the savings habit.6. Failure to understand and apply tax laws.7. Neglecting To Learn about investing.8. Money Disorders - Self-defeating relationship with money.

Money Myth #1Money Myth #1Everything in my life would be wonderful if only I had more money coming in!

RealityMore money coming in is usually accompanied by more money going out.

Money Myth #2Money Myth #2Financial well-being is defined by either how much money I have or how much I earn.

RealityRealityFinancial well-being has to do with how much you keep of what you earn, how well you manage what you have and how soundly you sleep at night.

Money Myth #3Money Myth #3Following a budget inhibits my freedom of choice

RealityRealityFollowing a budget brings greater control over important choices.

“Only the disciplined are free” --James C. Penny

Money Myth #4Money Myth #4All the Big Money-making All the Big Money-making opportunities are gone.opportunities are gone.

Reality

Economic opportunities Economic opportunities worldwide are more available worldwide are more available today than ever before in history.today than ever before in history.

Money Myth #5Money Myth #5The Government, My Employer or The Government, My Employer or Someone Else is Responsible for My Someone Else is Responsible for My Welfare.Welfare.((The World-owes-me-a-living syndrome)The World-owes-me-a-living syndrome)

RealityRealityWe alone are responsible for our We alone are responsible for our ultimate financial welfare. The ultimate financial welfare. The sooner we realize this, the quicker sooner we realize this, the quicker we can start on the road to wealth.we can start on the road to wealth.

Money Myth #6Money Myth #6You have to have a large amount You have to have a large amount of money to start saving.of money to start saving.

RealityRealitySaving is best done by putting Saving is best done by putting aside a little amount of money aside a little amount of money regularly over a long period of regularly over a long period of time.time.

Money Myth #7Money Myth #7Having a Good Job Leads Ultimately to Having a Good Job Leads Ultimately to Wealth.Wealth.RealityRealityA job is a temporary source of income; A job is a temporary source of income; to be wealthy you need permanent to be wealthy you need permanent sources of income. A job may turn out sources of income. A job may turn out to be merely a method for generating to be merely a method for generating cash flow for supporting an expensive cash flow for supporting an expensive and unsustainable standard of living and unsustainable standard of living unless you take steps to acquire or unless you take steps to acquire or create sources of income which flow to create sources of income which flow to you regardless of your job.you regardless of your job.

Money Myth #8Money Myth #8Retirement Planning is only for those Retirement Planning is only for those with a few years to the end of their with a few years to the end of their careers.careers.

RealityRetirement Planning is a lifelong Retirement Planning is a lifelong activity carried out against a activity carried out against a background of continually changing background of continually changing personal and family circumstances. personal and family circumstances. The sooner you start the easier.The sooner you start the easier.

It is not so bad to beIt is not so bad to be OLDOLD oror POORPOOR; ;

butbutit is ait is a TRAGEDYTRAGEDY to beto be

OLDOLD andand POOR!POOR!

To To KnowKnow And Not And Not Do Is Do Is NotNot Yet To Yet To

KnowKnow..

To look is one thingTo see what you look at is

anotherTo understand what you

see is a thirdTo learn from what you

understand is something else

But to ACT on what you learn is ALL that really

matters.... Joel Lerner

THANK YOU

25 Osolo way Off Muritala Mohammed Int’l Airport Rd. Lagos

P.O.Box 72241, Victoria Island, Lagos-Nigeria

Tel: 01-7937992, 08023291520

E-mail: ericighalopartners@yahoo.com, ighaloeric@yahoo.com

Website: www.ericighalo.com

For enquiries For enquiries please call or write to:please call or write to:

Country DirectorCountry Director

LAGOS, ABUJA, BENIN, PORT HARCOURT *Investment * Projects * Learning Consultants.

ERIC IGHALO & PARTNERS