FACULTY OF MANAGEMENT AND BUSINESS

BACHELOR OF BUSINESS ADMINISTRATION (HONS.) INVESTMENT

MANAGEMENT

PERSONAL FINANCIAL PLANNING (FIN533)

INDIVIDUAL ASSIGNMENT:
FAMILY FINANCIAL PLANNING

PREPARED BY:
SHAHRIZMAN INDRA BIN MOHD JEFREE
GROUP:
JBA2512D

PREPARED FOR:
PUAN ROHANIZAN MD LAZAN
.

SUBMISSION DATE:
19/5/2022
.
TABLE OF CONTENTS

ACKNOWLEDGEMENT 3
BIOGRAPHY OF THE 4-5
FAMILY
FINANCIAL INFORMATION 6
MONTHLY EXPENSES 7
BALANCE SHEET 8-9
STATEMENT
CASH FLOW STATEMENT 10
RATIOS 11-12
INCOME TAX YEAR 13
ASSESSMENT 2021
COMMENT AND ADVICE 14
COVID-19 AFFECTS FAMILY’S 15
FINANCIAL PLANNING

RECOMMENDATIONS 16
 ACKNOWLEDGEMENT

First, praises and thanks to Allah for his showers of blessings throughout
my assignment project to complete the task successfully. A lot of efforts have been
done and many people involved in contributing information that I need. I would like to
express my deep and sincere gratitude to all of them who help me through this process until I
can complete this assignment.

Not only that, but I would also like to express special gratitude and appreciation to my
FIN533 lecturer, Madam Sharida for all the guidance that she gave to all
students to fulfil this assignment. Without her guidance, I might not be able to do this
assignment. Next, I would like to thank Mr. Syafiq and his family for their good
cooperation with me and giving me the most valuable information in this assignment
to me.

Thank you
 BIOGRAPHY OF THE FAMILY

Mr. Muhammad Syafiq Bin Hj. Abu Bakar is working as project site manager in Muaffaq
Holding Sdn Bhd at Desa Tun Razak, Cheras, Kuala Lumpur. He is 35 years old and married
to 34-year-old Mrs. Nur Aminah Binti Hj. Mahmud Said. His wife is a full-time housewife,
so Mr. Syafiq has supported the family as the sole breadwinner and earns RM8,000 monthly.
He also paid income tax from his gross salary.

Mr. Syafiq and Mrs. Aminah have been married for almost 10 years and are blessed with two
children, a son, and a daughter. The first child, Muhammad Aizat, 7 years old is in primary
school at SK Bandar Rinching. The second child, Nur Aisyah, is 1 year and 3 months.

Mr. Syafiq’s family lives at Semenyih, Selangor, and lives in a double-storey terrace house
with his wife and his cheerful children. Mr. Syafiq bought the house in early 2011 and has
been living there with his family for almost 10 years already. Besides, he also owns a car,
Perodua Myvi and a Honda RS150 motorcycle regularly used to go to work by car and the
motorcycle is gradually used for daily uses like going to the mosque.
(The car that is used as a family car mr syafiq for shopping and so on)

(The motorcycle that Mr. Syafiq used to get to work)

 FINANCIAL INFORMATION
ITEMS RM
Monthly salary 8,000
Syafiq Savings on 31 December 2021 25,000
Aminah Saving on 31 December 2021 5,000
Bonus 2,000
Cash in hand 300
TNB accrued balance 150
Water bills accrued balance 50
Single-storey terrace house (market value) 300,000
Jewellery (market value) 10,000
Myvi (market value) 28,000
RS150 (market value) 9,000
Housing loan balance 96,000
Housing monthly instalment payment 800
Cuckoo dispenser loan balance (3360-840) 2,520
Cuckoo dispenser loan instalment monthly 70
Electricity and water bills per month 150
Wifi bills per month 100
Netflix bills per month 60
Umobile bills per month 70
Groceries per month 500
Utilize per month 200
Fuel expenses per month (70+30) 100
Touch n Go reload per month 100
Car and motorcycle maintenance per annum 730
Purchase laptop in January 2021 3,000
Purchase smartphone in October 2021 1,700
Annual school fees and tools 200
Exercise books for children 150
Tuition fee per month 150
School pocket money per month 60
Milk and diapers per month 300
Clothing expenses per annum 500
Income tax per month 868
EPF monthly 880
Zakat income 200
Zakat fitrah per annum 28
Wife allowances per month 500
Parent allowances per month 300
Medical insurance 450
Insurance and road tax per annum (300+660) 960
Investment in Tabung Haji (5,000+5 000) 10,000
Donation to Orphans Organization 500
 MONTHLY EXPENSES
January February March April May June July August September October NovemberDecember
Monthly Expense RM RM RM RM RM RM RM RM RM RM RM RM
Housing monthly payment 800 800 800 800 800 800 800 800 800 800 800 800
Cuckoo dispenser monthly payment 70 70 70 70 70 70 70 70 70 70 70 70
Electricity and water bills 150 150 150 150 150 150 150 150 150 150 150 150
Wifi bills per month 100 100 100 100 100 100 100 100 100 100 100 100
Netflix bills per month 60 60 60 60 60 60 60 60 60 60 60 60
Umobile bills per month 70 70 70 70 70 70 70 70 70 70 70 70
Groceries 500 500 500 500 500 500 500 500 500 500 500 500
Utilitize 200 200 200 200 200 200 200 200 200 200 200 200
Fuel expenses per month 100 100 100 100 100 100 100 100 100 100 100 100
Touch n Go reload 100 100 100 100 100 100 100 100 100 100 100 100
Myvi maintenance - - - - - 150 - - - - - 250
Honda RS150 maintenance - 50 30 - 50 60 - - 30 - 50 60
Apple MacBook air 5000 - - - - - - - - - - -
iPhone X - - - - - - - - - 1700 - -
School fee and tools - - - - - - - - - - - 200
Exercise books for children 150 - - - - - - - - - - -
Tuition fee 150 150 150 150 150 150 150 150 150 150 150 150
School pocket money per month 60 60 60 60 60 60 60 60 60 60 60 60
Milk and diapers per month 300 300 300 300 300 300 300 300 300 300 300 300
Clothing - - - - - 250 - - - - - 250
Parent allowances 300 300 300 300 300 300 300 300 300 300 300 300
Wife allowances 500 500 500 500 500 500 500 500 500 500 500 500
Medical insurance 450 450 450 450 450 450 450 450 450 450 450 450
EPF monthly 880 880 880 880 880 880 880 880 880 880 880 880
Income tax 868 868 868 868 868 868 868 868 868 868 868 868
Zakat 200 200 200 200 228 200 200 200 200 200 200 200
Insurance and road tax per annum - - - - - - - - 960 - - -
Donation to Orphans Organization - - - 500 - - - - - - - -
Total monthly expenses 11008 5908 5888 6358 5936 6318 5858 5858 6848 7558 5908 6618
 BALANCE SHEET STATEMENT

Mr. Syafiq's family balance sheet as at 31 December 2021

Assets Liabilities
Liquid Assets RM RM Current Liabilities RM RM
Syafiq saving account 25,000 TNB accrued 150
Aminah saving account 5,000 Pengurusan Air Selangor Sdn Bhd accrued 50
Cash in hand 300
Total Liquid Assets 30,300 Total Liabilities 200
Lifestyle Assets RM RM Non-current Liabilities RM RM
Single-storey terrace house 300,000 Housing loan balance 96,000
Perodua Myvi 28,000 Cuckoo dispenser loan balance 2,520
Honda RS150 10,000
Jewelry 10,000
Apple Macbook Air 5,000
Iphone X 1,700
Cuckoo dispenser 3,000
Household 5,000
Total Lifestyle Assets 362,700 Total Non-current Liabilities 98,520
Investment Assets RM RM Total Liabilities 98,720
Tabung Haji - Encik Syafiq 5,000 Net Worth 304,280
Tabung Haji - Puan Aminah 5,000

Total Investment Assets 10,000

Total Assets 403,000 Total Liabilities and Net Worth 403,000
 Total
Total Assets Net Worth
Liabilities
RM403,000 RM304,280
RM98,720

Based on the balance sheet as of 31 December 2021, Mr. Syafiq’s family amount of total assets is
RM403,000. The liquid asset is the balance in the savings account, and cash on hand and the balance in the
Next, the lifestyle assets, which is RM362,700 which consists of a single-storey terrace house with a loan
balance of RM96,000 from the purchased price of RM192,000 and the market price is RM300,000. Mr.
Syafiq has fully paid and settled the payment of the loan for the Perodua Myvi car and Honda RS150
motorcycle. He owns the Macbook Air and Iphone x which he had fully paid for. He also has jewellery as a
lifestyle asset since he bought jewellery for his lovely wife that amount to RM10,000. The Cuckoo Water
amounts to RM3,000 not fully paid while the household value owned by this family is RM5,000.
Besides, Mr. Syafiq also invest in Tabung Haji savings account together with his wife with a total of
RM10,000 that will be used in the future as backup money. There is Tenaga Nasional Berhad (TNB), and
Pengurusan Air Selangor Sdn Bhd accrued for current liabilities in the amount of RM200 while non-current
liabilities have a loan balance for a single-storey terrace house and a Cuckoo water purifier are a total of
RM98,520.

The following table below shows the details of the balance of the loan:
Housing loan balance (RM) The cuckoo dispenser
loan balance (RM)
Purchased price 125,000
Purchased price 3,000
Down payment 12,500
Down payment 0
Loan balance 112,500
Loan balance 3,000
Interest rate 5.91%
Interest rate 5.67%
Tenure/months 20 years / 240 months
Tenure/months 4 years / 48 months
Total loan 192,000
Total loan 3,360
Annual installment 9600
Annual instalment 840
Outstanding tenure 10 years / 120 months Outstanding
Outstanding balance 96,000 3 years / 36 months
tenure
Outstanding
2,520
balance
 CASH FLOW STATEMENT
Mr. Syafiq family Cash flow Statement for the year ended 31 December 2021

income: RM RM
Gross salary (8,000 x 12) 96,000  
Bonus 2,000  
     
Total income 98,000
 
Less: expenses    
Housing monthly payment (800 x 12) 9,600  
Cuckoo dispenser monthly payment (70 x 12) 840  
Electricity and water bills (150 x 12) 1,800  
Wifi bills per month (100 x 12) 1,200  
Netflix bills per month (60 x 12) 720  
Umobile bills per month (70 x 12) 840  
Groceries (500 x 12) 6,000  
Utilitize (200 x 12) 2,400  
Fuel expenses per month (100 x 12) 1,200  
Touch n Go reload (100 x 12) 1,200  
Myvi maintenance 400  
Honda RS150 maintenance 330  
Apple MacBook air 5,000  
iPhone X 1,700  
School fees and tools 200  
Exercise books for children 150  
Tuition fee (150 x 12) 1,800  
School pocket money per month (60 x 12) 720  
Milk and diapers per month (300 x 12) 3,600  
Clothing (250 x 2) 500  
Wife allowances (500 x 12) 6,000  
Parent allowances (300 x 12) 3,600  
Medical insurance (450 x 12) 5,400  
EPF monthly (880 x 12) 10,560  
Income tax (868 x 12) 10,416  
Zakat (200 x 12) + 28 2,428  
Insurance and road tax per annum 960  
Donation to Orphans Organization 500  
Total expenses   80,064
Contribution to savings   17,936

RATIOS
 Current ratio Debt service
take-home pay Debt ratio
coverage ratio
ratios 35.4% 151.5 times 24.5%
RM98.37
@4.25 months

Asset Liquidity

i. Liquid assets to take-home pay ratio

= Liquid assets
Take-home pay

= 𝑅𝑀30,300
(𝑅𝑀96,000-𝑅𝑀10,416)

= 35.4% @ 4.25 months

The ratio implies a liquidity position for Mr. Syafiq and his family. In this case, he loses
his job, he can survive for about only 4.25 months using his liquid assets and it is in the safe zone because of
more than 3 months.

ii. Current ratio

= Liquid assets
Current liabilities

=𝑅𝑀30,300
𝑅𝑀200

= 151.5 times

Based on the current ratio, Mr. Syafiq’s family has a high liquidity position because it
is more than one. Therefore, he can manage to pay their short-term obligations.

Level of Debt

i. Debt Ratio

=Total liabilities
Total assets
= RM98,720
RM403,000
 = 24.5%

Mr. Syafiq’s debt is 24.5% of his total assets. The ratio indicates low debt and a safe position
for this family. Meaning to say this family may not face difficulties in getting new loans and
meet their obligation in the future.

ii. Debt service coverage ratio

=Take-home pay
Debt service charges

=RM96,000-RM10,416
RM870

= RM98.37

Mr. Syafiq earns RM98.37 in take-home pay for each RM1.00 he needs to pay for his
loan payment. The higher the ratio, the better because it indicates that this family can
make debt payments.

INCOME TAX YEAR

ASSESSMENT 202
 Mr. Syafiq’s income tax for the year assessment 2021
Aggregate income: RM RM
Gross salary (8,000 x 12) 96,000  
Bonus 2,000  
     
Total Aggregate Income   98,000
Less: Donation to Orphans Organization   500
Total Assessable Income   97,500
     
Less: Relief    
Individual 9,000  
Parent: one mother 1,500  
Wife 1,500  
Child: Muhammad Aizat (7 years old) 2,000  
Nur Aisyah (1 year) 2,000  
Medical insurance 3,000  
Lifestyle: Macbook Air and Iphone X (5,000 + 1,700) 6,700  
Exercise book for children 150  
EPF (880 x 12) 10,560  
Total Relief   36,410
Total Chargeable Income   61,090
Income Tax Computation:    
On the 1st: 50,000 600  
On the next: 11,090 1442  
Total Income Tax   2,042
Less: Rebates    
Zakat (200 x 12) + 28 2,428  
Total Rebate   2,428
Total Taxable Income   -386
Less: tax deduction (868 x 12)   10,416
     
Total Net Tax Refund   -10,802
 COMMENT AND ADVICE

Based on the balance sheet statement, Mr. Syafiq’s family has sufficient assets or savings to satisfy the
family’s liabilities, which total RM403,000 in assets and RM98,720 in liabilities. According to the
percentage of ratios, there is no issue for him to pay his debt, whether current or non-current liabilities.
Moreover, he also can have another loan because his ability to pay the debt has increased.
This family’s net worth is also extremely substantial, at RM304,280 with few liabilities, indicating
that it is a true reflection of his wealth and financial stability. Besides, based on the cash flow statement, Mr.
Syafiq’s family receives a contribution to savings which is RM17,936 since the total income exceeds the
entire expenses.
The family’s expenses are more on groceries which is RM500 because Mrs. Aminah provides food for
her husband at work and her child for school to be more economical. The family's electricity bill and water
bill are only RM150. This shows that Mr. Syafiq’s family is good at reducing the cost of expenses besides
taking an affordable internet bill and phone bill package. Other than that, even though Mr. syafiq's
workplace is far from his residential area Mr. Syafiq goes to work using a motorcycle to save fuel and tolls.
Mr. Syafiq’s income tax year assessment 2021 shows a positive result, as his total tax refund amount is
RM11,036. It is a huge amount. This means he was not required to pay the tax and was instead repaid by the
company. Mr. Syafiq should always double-check the tax so as not to overpay because Mr. Syafiq can use it
for better purposes such as making small business capital or investing in ASB with the money.
Finally, based on my research Mr. Syafiq's finances are in a very healthy state. I believe that Mr. Syafiq
has done his best to reduce the cost of expenses as he is more concerned about his family's future. Apart
from having a home as an asset, he also has two investment platforms and jewellery that is gifted to his wife
to have a strong asset for emergencies.
 COVID-19 AFFECTS FAMILY’S
FINANCIAL PLANNING

The COVID-19 pandemic has had a financial impact on many families, putting their health and well-
being at risk. It may not affect all families, but it is harmful, especially to low-income families who may lack
the financial resources to meet their families’ demands

In Malaysia, the government has decided to conduct Movement Control Order (MCO) across the country
to prevent the virus from spreading. That decision, however, harmed the country’s economic situation. As a
result, a lot of employees were exposed to the negative financial implications. It is expected that repeating
the MCO will have a greater impact on someone, especially if they are already in trouble financially. People
with the knowledge are better able to control their financial situations, but this is not the same for
individuals who do not know about finance. Furthermore, in this economic climate, it will be even more
difficult for the unemployed to subsist.
According to my observations on the financial plans of Mr. Syafiq's family, this pandemic did little to
affect him as he was still able to continue his work by working from home and that is why he bought a new
Macbook Air and Iphone X to facilitate his work. In addition, Mr. Syafiq works in offices and construction
project sites in rotation with his colleagues to fulfil the SOPs employed by the government. Even if he is
unable to go out to work, Mr Syafiq is not worried because his salary remains the same because of the
government's directive to the employer to provide the proper salary. Thus, Mr. Syafiq's salary remained
unchanged.
 RECOMMENDATIONS
 Insurance planning

Insurance planning is an important aspect of modern living. It is crucial for Mr. Syafiq protects his assets
as he builds his wealth to prevent any unforeseen events. Insurance planning might help him save a lot of
money in the long term. The only insurance plan, now, that Mr. Syafiq brought was medical insurance for
his family. Therefore, he only pays RM5,400 a year for insurance, which is not a big deal as he can afford to
pay every month. Mr. Syafiq is eligible for a tax deduction for life insurance. He should consider buying life
insurance, especially since he works on high-risk project sites.

There are many options for education insurance such as AIA, Maybank and more. For example, Mr.
Syafiq could take advantage of Maybank Malaysia’s premium education savings which is an investment-
linked lifetime plan that promotes a mix of coverage and good investments for his children. The lifelong
investing allows his children to take over the policy ownership and continue saving once they reach the age
of 25, with the plan expiring at age 100

 Investment planning

The process of setting financial goals and putting them into a strategy is known as investment planning
and it becomes the most important aspect of financial planning. There are numerous investment vehicles
available today, the most prevalent of which are property, cash, bonds, and equities. Therefore, referring to
the financial resources, a person can invest in these vehicles to achieve their aims and objectives.
Mr Syafiq can consider increasing his investment Mr Syafiq is financially able to invest in ASB as the
platform is very safe despite the low interest in a year. This is because his savings account has a surplus, and
the loss is also only saved and does not bring returns. Mr Syafiq does not have to worry as his money is still
growing at a very small and safe risk. This will ensure the life of Mr Syafiq and his family in the future.

 Retirement planning

The process of identifying retirement income objectives, as well as the actions and decisions
required to meet these goals are known as retirement planning. Identifying sources of growth,
predicting expenses, and managing assets and risk are all part of retirement planning. Mr. Syafiq
should contribute to the Private Retirement Scheme (PRS) for future investment in his retirement
years because he can claim a tax deduction of up to RM 3,000. This retirement preparation would
make Mr. Syafiq and his family live well in the future.

 Estate planning

Our plan for the distribution of our estate when we die is included in our estate planning. Assets,
cars, investments, and bank savings are all part of Mr. Syafiq’s estate. The estate is jointly owned by
Mr. Syafiq and Mrs. Aminah. Both must make sure that all the assets are passed on to the persons of
their choice in the future. Besides, he needs to renew his will regularly because the estate changes.
Wills are crucial because they prevent problems and disagreements among the beneficiaries, which
are his children.