MoneyWi$e Money Management Training

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MoneyWieMoney Management Training

• Welcome
• MoneyWie is a joint financial education project
  of Consumer Action and Capital One

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The Money Management course will give you...

• An understanding of what good money management is
  and why it is important
  
• Skills and ideas to help you better manage your
  money

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Money Management

• Session One
• (Two hours)

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Course objectives

• This seminar will help you understand
• How to prepare a budget
• How to balance your accounts
• How to cut back on expenses
• Ideas for increasing your income
• How to save more
• How to set financial goals

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In participants folders

• Manage Your Money Wisely (brochure)
• Checkbook Balancing Activity (worksheet)
• Money Management Self Evaluation
• Three Sample Profiles (class exercise)
• Financial Goals Worksheets
• Take-home Budget Worksheet
• Money Management Seminar Evaluation Form

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Money management

• What is money management?
• Knowing how to save, spend and invest your money
  so that you and your family can successfully work
  toward your financial goals
  

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Money management activities

• What activities go with money management?
• Tracking your spending.
• Making a budget.
• Balancing your checkbook.
• Using credit wisely.
• Setting long- and short-term goals.
• Earmarking money for savings.

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Be a wise money manager

• Wise money management can help you
• Pay your bills on time.
• Make it through times when you are not working.
• Save money.
• Plan for short- and long-term goals.

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Budgeting

• What is a budget?
• A spending plan to help you forecast and control
  your expenses.

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Making a budget

• How do you make a budget?
• You need to figure out how much you spend each
  month and compare that amount to your take-home
  pay.
  
• Track your spending for a set period of time,
  like a month, in order to figure out how much
  money you spend.

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Tracking your spending

• What are some ways to track how much money you
  are spending each day, each week, or each month?

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Ways to track spending

• Keep a notebook handy and write down everything
  you buy and every bill you pay.
  
• Keep all your receipts in an envelope or shoe
  box.
  
• Create a computer file for entering your income
  and expenses.
  

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Your budget

• What are some of the things that should be
  included in your budget?

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Your budget may include

• Housing
• Food (groceries, restaurants, snacks)
• Automobile (payments, gas, repairs, insurance,
  commuting expenses)
  
• Clothing personal grooming
• Utilities (electric, gas, water, cable)
• Credit card payments

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Your budget may include

• Student loan payments
• Child care
• Insurance payments
• Entertainment (movies, concerts, books)
• Medical bills
• Vacations
• Income taxes

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Making your budget work

• Does your income cover your expenses?
• If not, you need to figure out how to spend less
  or earn more.

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Bank accounts

• A bank account is an important money management
  tool.
  
• How can a bank account help you manage your money
  wisely?

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Bank accounts

• A bank account helps you keep track of your
  spending and how much money you have available.
  
• Use your checkbook register to write down and
  deduct
  
• Every check you write
• Every ATM or debit card transaction or purchase
• Any bank fees you pay

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Benefits of a bank account

• Money is safe.
• Each account is insured.
• Canceled checks prove you paid a bill.
• Having a bank account can save you money.

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Lets take a break

• Please come back in 15 minutes.

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Lets balance a sample checkbook

• Take out the checkbook balancing activity from
  your folders
  
• Review the sample bank statement.
• Balance the sample checkbook register.
• Balance the sample account using the checkbook
  balancing worksheet.

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Cutting back on expenses

• What are some ways to cut back on expenses?

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Ideas to help you cut back

• Shop around and compare prices.
• Make a shopping list and stick to it.
• Prepare meals and bag lunches at home.
• Dont shop recreationallyyou could be tempted to
  buy things you dont need

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More ways to cut back

• Use the public library for books, magazines,
  videos.
  
• Join a buying co-op.
• Lower your thermostat when away or sleeping.
• Walk instead of drive.
• Look for a free bank account.

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Increase your income

• Ways to earn extra money
• Part-time or weekend job.
• Take advantage of income tax programs, such as
  the Earned Income Tax Credit.
  
• Start a home-based business.
• Rent out a room.

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Setting financial goals

• Short-term goal (1-2 years) buying a new car,
  getting a degree or planning a wedding.
  
• Long-term goal (5-10 years or more) owning a
  home, starting a family, paying for college or
  retiring.
  

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Working toward your goals

• A savings plan allows you to work steadily toward
  your financial goals.
  
• The take-home Financial Goals Worksheet will
  help you figure out a savings plan that works
  with your particular goals.
  

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Take-home activity

• The Financial Goals Worksheet and Chart can be
  found in each of your folders.
  
• Complete the worksheets at home.
• Bring the completed worksheet back for the second
  session.
  
• See you next time!

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Money Management

• Session Two
• (Two hours)

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Money Management

• Welcome back!
• In this session we will focus on saving,
  investing, insurance, credit and debt
  

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Saving investing

• Lets review your Financial Goals Worksheet.
• Saving and investing can help you to reach your
  short-term and long-term goals.

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How to save more

• Pay yourself first by scheduling automatic
  deposits on pay day that go into your savings
  account or IRA (individual retirement account)

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Retirement accounts

• Does your employer offer a retirement savings
  plan, such as an IRA. An IRA can help your
  retirement savings grow faster because you do not
  have to pay taxes on the earnings until you are
  eligible to withdraw from the account, at age 59
  1/2.

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Saving - CDs

• A CD (certificate of deposit) is a safe way to
  save.
  
• Like savings accounts, CDs are insured by the
  government.
  
• CDs often earn a higher interest rate than
  savings accounts do.
  
• However, CDs require that you leave your money
  for a set period of time, such as six months or
  a year.
  

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Investing

• An investment is the use of money to create more
  money
  
• Stocks, bonds and mutual funds are all types of
  investments
  
• Consider an investment advisor.
• Be cautiousinvestments are not
  government-insured and you could lose your
  money.
  

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Insurance

• What are the benefits of having insurance?
• Insurance protects you against financial ruin as
  a result of an unforeseen catastrophe like fire,
  theft or medical emergency.
  

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Kinds of insurance

• What are the most important types of insurance
  for you and your family?
  
• Automobile insurance
• Health insurance
• Homeowners or renters insurance
• Life insurance

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Saving money on insurance

• Always ask if you are eligible for any insurance
  discounts.
  
• Internet sites can help you compare premiums
• QuoteSmith (www.quotesmith.com)
• Quicken Insurance (www.insuremarket.com)

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Credit

• Good credit can help you
• Rent an apartment
• Purchase a home
• Get a job
• Set up phone and power service.
• Buy big-ticket items without cash
• Borrow money
• Obtain a credit card
• Rent a car

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To build good credit...

• Pay your bills on time.
• If you carry a balance, pay as much as you can
  each month.

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Rebuilding credit

• If you have damaged your credit, try applying for
  credit with local businesses or for a secured
  credit card (a bank credit card backed by money
  you deposit in a bank account)

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Home equity loans

• Home equity loans can be used to consolidate
  debt.
  
• Be very careful before taking out a loan secured
  by your home (a home equity loan or line of
  credit).
  
• If you fail to make a payment, you risk losing
  your home.

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Good credit

• Try to avoid these expensive credit options
• Pawn shops, pay day loans, and car title pawn
  shops
  
• Offers to buy things on credit with deferred
  interest
  
• Credit cards with rates higher than the national
  average (currently about 13.50)

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Overwhelmed by debt?

• The National Foundation for Consumer Credit -
  [phone] or www.nfcc.org can refer you to a
  credit counselor in your area. Low- or no-cost
  services help you establish a repayment plan.
• Debtors Anonymous [phone]
  debtorsanonymous.org
  

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Lets take a break

• Please come back in 15 minutes.

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Money management activity

• Break into small groups.
• Review sample profiles.
• Discuss how the people in the sample profile can
  get back on track.
  
• Select a spokesperson from each group to present
  your ideas.

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Take-home budget worksheet

• In your folder youll find a budget worksheet.
• Track your spending for a while and then complete
  this worksheet at home.
  
• Keep yourself focused on creative ways to save
  money.

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Questions?

• Lets try to answer some of your questions about
  money management.

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Now you can grade us!

• Please fill out the seminar evaluation form and
  leave it with me on your way out.

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Congratulations!

• Congratulations on completing the Money Wie
  Manage Your Money Wisely seminar!
  
• Youve taken a big step toward wise money
  management.
  
• Put what youve learned into practiceyou can do
  it!