Financial Literacy

1
Financial Literacy

• Shannon Stump
• PNC Bank

2
Financial Literacy

• Introduction
• Financial Health
• Budgeting for Students
• What is Credit?
• Students and Credit Cards
• Getting out of Debt
• Avoiding ID Theft

3
Introduction

• Why Financial Literacy? Why now?
• The Demanding College Experience
• 1st Time in Control of Spending
• Main Dangers
• GOAL
• Teach students how to reduce their overall
  college debt by making smart financial choices
  while in college.

4
Financial Health

• 1 question to ask
• Will you make the decisions to support your
  financial goal?
• No magic formula
• Getting in shape!
• Mastering your own behavior

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Financial Health

• What does it mean to be financially healthy?
• Free of crushing debt
• Free of high interest debt
• Planning for the future

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Financial Health

• So how do you become financially healthy?
• Create a realistic budget
• Minimize debt
• Dont buy on credit cards
• Spending more than you have
• College books vs. Plasma TV
• Dont give into peer pressure
• Keeping up with your friends
• Latte

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Budgeting for Students

• What is one of the biggest reasons we spend to
  much money?
• Lack of planning
• Pizza and MP3s
• So how do we plan?
• Budget
• What is a budget?
• Spending/Savings

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Budgeting for Students

• Budget
• Goals of a budget?
• Calculators?
• Income
• Expenses
• Cash Flow

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What is Credit?

• What is Credit?
• Promise that money borrowed will be repaid
  usually with interest.
• Why would we use it?
• Allows us to get things without having to carry
  cash
• Allows us to buy things we might not be able to
  afford
• Ex. Home, College education

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What is Credit

• Credit Reports and Scores
• Friends?
• Rate the likelihood that people will repay their
  debt
• Financial history
• Better credit/Better rates
• Who looks at my credit?
• Car dealer, private education loans, home loans,
  insurace companies, landlords, and even employees

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What is Credit

• What is on my credit? 7 years
• SSN
• DOB
• Address
• Employers
• Bankruptcies, tax problems, etc.
• How much you borrow on loans/CC
• Your payment history
• Collection Accounts

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What is Credit

• The Score
• 300 to 850
• Average score is 700

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What is Credit

• How do I obtain good credit?
• Pay your bills on time
• Manage your Credit Cards
• Review your credit report periodically
• AnnualCreditReport.com

14
Students and Credit Cards

• Second major debt students have next to student
  loans
• Average students CC debt
• 3 out of 5 first year college students with
  credit cards max them out within the first year
• Why does this happen?
• Target

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Students and Credit Cards

• Should I use cash for everything?
• Emergency purchases
• Cars, airline tickets, hotel rooms NOT dinner and
  a movie
• General rule
• If you can eat, drink or wear and item, its
  usually not a good use of credit.

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Getting out of Debt

• Credit Cards are simple, right?
• You charge it, you pay it off- whats so
  complicated about that?
• Charge more than you can repay
• Interest
• Minimum payment trap
• Example

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Getting out of Debt

• Warning signs
• Consolidating debt
• May lower your rate at first
• Risks
• Can get into more debt if you dont cancel your
  old cards
• Request a lower rate
• 50

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Avoiding Identity Theft

• Cost victims over 5 BILLION DOLLARS a YEAR
• When does it occur and how does it work?
• How many people does if affect yearly?
• How long does it take to repair my credit?
• How can I prevent it?
• Protect SSN, report lost or stolen cards
• Be aware of Key loggers
• Phishing scams
• Pretexting