1.Explain whether the statements are true or false.

a.Personal financial planning is a process that should be carried out on a regular five-yearly basis.

b.It is far more important for older people to engage with personal financial planning, than younger people.

c.If inflation is measured at 3% per annum and a savings account is paying interest at 3% per annum, the purchasing power of the savings made will remain unchanged.

d.Career planning is not a part of financial planning.

e.Once you have set your financial goals, you should try to achieve them by all means.

2.Calculation

Your friend is now working in an insurance company. He is prompting an investment project of his company to you:

Our company is now offering a plan, which is a very good project. You just need to pay $3000 at the end of each month from January 2017 for ten years. Then you can get back HK$1million on 31st December 2046.

Assume that the market interest rate is 6%p.a. and is stable during the period, will you consider the project?