Application
This unit describes the skills and knowledge required to develop, maintain and enhance understanding of personal finance matters, including taxation, superannuation and insurance.
It applies to individuals who build financial literacy in workplaces, schools, adult and community learning organisations or registered training organisations. The unit may also be used as part of pre-vocational or new apprenticeship programs, or as part of services provided by counselling and advisory organisations.
No licensing, legislative or certification requirements apply to this unit at the time of publication.
Elements and Performance Criteria
ELEMENT | PERFORMANCE CRITERIA |
Elements describe the essential outcomes. | Performance criteria describe the performance needed to demonstrate achievement of the element. |
1. Demonstrate knowledge of personal financial matters | 1.1 Determine how career choice, education and skills affect income and goal attainment 1.2 Identify short-term and long-term financial goals 1.3 Identify tax matters relating to personal income 1.4 Explain impact of consumer and financial behaviour on personal spending 1.5 Explain how insurance and other risk management strategies protect against financial loss 1.6 Identify components of superannuation relevant to individual income earners |
2. Manage personal finances | 2.1 Compare benefits and costs of alternatives in spending decisions 2.2 Identify purpose of planning personal finances 2.3 Make personal financial choices based on logical decision making 2.4 Evaluate consequences of personal financial decisions, including contracts 2.5 Develop methods and systems (including electronic) to stay in control of personal cash flow, spending and use of debt |
3. Build knowledge of personal financial matters | 3.1 Explore and evaluate factors that affect personal credit worthiness 3.2 Seek advice from a specialist or mentor where required 3.3 Develop systems for maintaining up-to-date knowledge about personal finances and career opportunities to achieve goals 3.4 Identify reliable sources of ongoing information relevant to personal career and financial goals |
Evidence of Performance
Evidence of the ability to:
set personal financial goals and access opportunities for mentoring or advice on them
access information to build on and maintain knowledge of factors affecting personal finances.
Note: If a specific volume or frequency is not stated, then evidence must be provided at least once.
Evidence of Knowledge
To complete the unit requirements safely and effectively, the individual must:
explain debt management including:
responsible use of credit
advantages of debit cards
consequences of debt default
attitude towards credit and spending
options for debt repayment
describe employee entitlements under:
Fair Work Act
equal opportunity legislation
Superannuation Act
Income Tax Assessment Act
Taxation Administration Regulations
describe how to find out about pay rates
explain how to establish and maintain a good credit history
explain the importance of saving money as a concept to assist and improve a life situation
outline insurance matters:
value of insurance
disclosure obligations
suitable insurance cover for personal income, trade tools, house, car and health
describe personal implications of taxation matters including:
role of the Australian Taxation Office and why tax is paid on income
personal tax liabilities and allowable deductions
tax rates
lodgement dates
awareness of goods and services tax (GST), pay as you go tax (PAYG), Australian business number (ABN), tax file number (TFN) and business activity statements (BAS)
explain principles of budgeting, cash flow and saving including:
role of credit and savings in establishing personal wealth
understanding of financial institutions and their savings, investment and credit products
describe personal financial aspects of:
bank accounts including savings, credit and investment
insurance cover for health, car, phone, warranty, tools, household and income protection
contracts including phones, data, tenancy and finance
explain superannuation matters including:
types of funds – retail versus industry
fund options – death or total and permanent disability (TPD) insurance
planning for the future
power of compound interest
superannuation guarantee
co-contributions
personal contributions
fees and charges
value of consolidating super funds
locating lost super.
Assessment Conditions
Assessment must be conducted in a safe environment where evidence gathered demonstrates consistent performance of typical activities experienced in the financial literacy field and include access to current information about personal financial matters.
Assessors must satisfy NVR/AQTF assessor requirements.
Foundation Skills
This section describes language, literacy, numeracy and employment skills incorporated in the performance criteria that are required for competent performance.
Skill | Performance Criteria | Description |
Reading | 1.1, 1.3-1.6, 2.1, 2.2, 3.1 | Researches and interprets written information from a range of sources to identify relevant aspects for the required task |
Writing | 2.5 | Records and documents information accurately using correct language, terminology and concepts |
Oral Communication | 3.2 | Uses active listening and questioning to source advice and develop a clear understanding of information |
Numeracy | 1.1-1.3, 1.5, 1.6, 2.1, 2.4, 2.5 | Performs a range of mathematical calculations to interpret financial information, and to balance or create budgets and savings plans |
Navigate the world of work | 1.1-1.6, 2.1, 2.2, 3.1, 3.4 | Maintains up-to-date knowledge of personal financial management necessary for own situation |
Get the work done | 1.1, 1.2, 2.3-2.6, 3.3 | Uses digital systems and tools to complete tasks, and to access and manage finance related information Plans routine tasks and organises work according to defined requirements |
Sectors
Financial literacy