If you think you dont have any money, think again

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FUTURE EARNINGS
If you think you dont have any money, think
again!

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If you earn 20,000 per year, and you work for 45
years, you will earn 900,000 without raises!!!
Dont you think you should have something to show
for this money?
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Value of 1
If you save 1 per day from your 18th birthday
until your 65th birthday and the money earns 5
in a savings account, how much will you have
saved?
69,232.43
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If you invest that 1 in a mutual fund that earns
10 per year, how much will you have?
397,398.93
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By earning a higher rate or return (10 vs. 5),
you made 328,166.50.
When you have a long time to save, you can afford
to take more risk.
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Want to be a Millionaire at 65?
If you are 18, how much do you think you have to
save?
78.01 per month at 10 compounded monthly or
2.30 a day.
This is less than the cost of a pack of
cigarettes a day or a slice of pizza and a soda.
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But if you wait?
You need to invest At 25 258.13 per month
At 35 442.38 per month
At 45 1,316.88 per month
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Who will have more money when they retire,

• those who save 75 per month from age 18 to age
  28 and then makes no additional payments or

b) those who save 75 a month from age 28 until
they are age 65?
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• The person who saves 75 per month from age 18 to
  28 at 8 will have 236,626.41, of which 9,000
  is contributions and 227,626.41 is return on
  investment.

The person who starts at age 28 and saves 75 per
month until age 65 at 8 will have 203,730.02,
of which 33,300 is contributions and 170,430.02
is return on investment.
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Start saving at an early age get in the habit
of paying yourself first.
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MONTHLY BUDGET
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WHERE DID I
SPEND THAT MONEY?
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BUDGET BUSTERS
Item Frequency Price
Savings/Year
Soda (1 per day) .65 237.25
Candy Bar (1 per day) .75
273.75
Potato Chips (1 per day) .99
361.35
Cigarettes (1 per day) 2.50
912.50
Movie (2 per month) 7.00
168.00
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MORE BUDGET BUSTERS
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How do you decide what spending choices to make
so you have money to save?
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VALUES

• WHAT IS IMPORTANT TO YOU?

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WHERE DO VALUES COME FROM?

• FAMILY OF ORIGIN
• CULTURE
• RELIGION
• PERSONAL EXPERIENCE
• MEDIA

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WHAT ARE MY MONEY VALUES?
HOW DO I
feel about my credit rating
use credit
pay bills
plan my use of money
decide what financial risks to take
decide what charitable contributions to make
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• If your money is going toward something you
  value, then you will usually feel a sense of
  satisfaction and accomplishment.

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• But if your money is going toward something you
  do not value, then you will usually experience a
  sense of frustration and failure.

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6 AREAS OF LIFE

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Important to focus on ALL areas not just one
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Your values tell you what is important to you
your goals are the steps to take you to where you
want to be.
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WHERE DO YOU WANT TO BE IN 10 YEARS?

• What type of job will you have?
• What salary will you earn?
• Will you be married?
• Will you have children?
• Will you live in a house, apartment, condo, farm,
  etc?
• How will you spend your leisure time?
• What are three absolutely essential elements in
  your ideal life?

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GOALS

• MUST BE YOUR OWN
• INCLUDE A TIMETABLE
• BE WORDED POSITIVELY
• BE ATTAINABLE
• BE AS SPECIFIC AS POSSIBLE
• INCLUDE SOME TYPE OF CHANGE

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I will save 300 by March 15 to travel to Florida
for Spring Break.
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SO YOU WANT TO GO TO FLORIDA?

• WHERE WILL YOU FIND THE 300?

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CUT YOUR EXPENSES

• PLAN NO COST OR LOW COST ACTIVITIES
• USE PUBLIC TRANSPORTATION
• AVOID OR DELAY NEW PURCHASES

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OR TRY. . .

• EAT IN MORE OFTEN
• BUY ON SALE
• WATCH DAILY EXPENSES
• CREATE A BUDGET STICK TO IT!

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SHOPPING ALTERNATIVES

• Garage Sales
• Friends/Relatives
• Dollar Stores
• Flea Markets
• Factory Outlet
• Almost New Stores

Garage Sale
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PLAN AHEAD

• BE PREPARED FOR OBSTACLES
• THINK OF SOLUTIONS IN ADVANCE

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GOAL SETTING
FINANCIAL GOAL My Goal________________________
__________________ Cost___________ Money
Needed_______________ Target Date ________
Amount (weekly/monthly)_____ Specific Steps
Toward Goal__________________________ ___________
______________________________________ ___________
______________________________________ Who Can I
Call on to Help me Reach This Goal?__________ Poss
ible Obstacles_________________________________ _
________________________________________________ P
ossible Solutions________________________________
__ _______________________________________________
__ What makes this worth the trouble?_____________
______ ___________________________________________
______
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HABITS ATTITUDES

• Are your habits and attitudes sabotaging
  your goals?

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Changing a Habit is the Hardest Goal to Achieve
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If you continue doing what you have been doing,
you will continue to get what you have been
getting.
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What Prevents Change

• Fear

• Indecision

• Lack of Information

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How to Change a Habit

• Step 1 Recognize habits as a way of
  achieving satisfaction
• Step 2 Know what specific satisfaction a
  particular habit provides
• Step 3 Substitute a more effective habit
  for the undesirable one

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PROBLEM MONEY HABITS

• Do I compare my possessions to those of other
  people?
• Do I feel less than someone who HAS the things
  that I dont have?
• Do I feel better when I buy something? How long
  does the better feeling last before it wears off
  and I need something new to refuel the good
  feeling? Hours? Days? Weeks?

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Do your wants sabotage your goals?
want
need
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NEEDS VS. WANTS

• FOOD

• STEAK VS. HAMBURGERS

APARTMENTS VS. DORMITORY
SHELTER
CLOTHING
NIKE VS. PAYLESS
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NEW VS. USED

• CAR
• APPLIANCES
• FURNITURE
• CLOTHING

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want
need
Not if your wants are within your budget!
Budget
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Think Twice Before Relying on Credit to Meet
Daily Needs
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Do You Know?
You have 500 on your credit card. How long will
it take to pay it off if you make the minimum 10
monthly payment and the interest rate on your
credit card is 18?
94 months or almost 8 years and pay 440 in
interest
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If you pay 30 a month,it will take you 20
months.
That means for almost 2 years you have 20 less a
month to spend on current needs. However, you
pay only 100 in interest, a savings of 340 in
interest.
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TYPES OF CREDIT

• Family/Friends
• Auto Loans
• Student Loans
• Credit Cards
• Check Cashing
• Rent-to-Own

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CHOOSING A CREDIT CARD

• SHOP COMPARE FOR LOWEST FEES
• CHECK FINE PRINT

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BEWARE OF FINE PRINT
Membership Fees 59.00 annual fee
One-time processing fee 49.00 plus
Annual Percentage Rate 23.99
Grace Period 20-25 days if previous months
balance was paid in full
Fee for cash advances 5 (minimum 3)
Returned check fee 25.00
Late Payment Fee 25.00
Over-the-Credit-Limit 25.00
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RULES OF THUMB

• DO NOT BUY WHAT YOU CANNOT AFFORD
• ITEMS SHOULD LAST LONGER THAN PAYMENTS
• DONT THINK MINIMUM PAYMENT
• USING CREDIT COMMITS FUTURE INCOME

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Will your budget survive an emergency or
unexpected event?
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EMERGENCY FUNDS

• Medical
• Pets
• Car
• What else?

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INSURANCE
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PROTECT WHAT YOU OWN

• DO YOU HAVE
• AUTO INSURANCE?
• RENTERS INSURANCE?

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PROTECT WHAT YOU OWN

• DO YOU HAVE
• MEDICAL INSURANCE?
• DISABILITY INSURANCE?

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Pay Yourself First If You Want to be Wealthy
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Start Saving Early
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Protect What You Have
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WOULD YOU LIKE MORE INFORMATION?
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