FIE432E Personal finance and taxation
Autumn 2018Spring 2019
The course will address questions such as:
- Should you invest in bonds, shares, real estate, private equity or a mix thereof?
- Should you invest part of your wealth abroad?
- When and how much should you borrow?
- How much should you save for pension, and your children's education?
We will show how formal frameworks can be used for making optimal private financial decisions. The frameworks will highlight the importance of personal circumstances and preferences as well as external institutional conditions. The course will have a particular focus on the effect of taxes. We will also consider how individuals can use changes in the tax system to their advantage, and what mistakes people tend to make in the real world. This course is specifically targeted at students who will work in family firms and students who seek to work in sectors that advice individuals and small business owners on their financial decisions. This includes jobs in the banking, insurance, wealth management, accounting and pension sector. More broadly, the personal finance sector touches most other sectors of the economy, directly or indirectly, and involves each of us in our daily lives.
The primary objective of this course is to teach students how to make personal financial decisions and how to advice others on such decisions. The course will address the relationship between corporate and personal taxation and is relevant for business owners as well as employees. At the end of this course students will:
- Know how to structure a retirement portfolio.
- Know what determines the optimal asset mix.
- Understand how to make borrowing decisions.
- Know how the tax system impacts financial decisions.
- Be able to explain the interplay between private and public pension schemes.
- Develop the skills to understand how assets are priced in the presence of taxation.
- Discover the most common mistakes individuals make in their financial decisions.
- Achieve competence in making financial decisions during their lives.
- Be able to advise others on financial decision making.
Bachelor mathematics, finance and microeconomics such as MET1, BED3, SAM1/SAM2.
Credit reduction due to overlap
100 % credit reduction towards FIE432
Requirements for course approval
Students have to pass a multiple choice test on Canvas.
Written school exam, 4 hours (in English)
You can only retake the exam under the same code, FIE432E.
Selected readings on Canvas.
- ECTS Credits
- Teaching language
Floris T. Zoutmann, Department of Business and Management Science