Consumer Services Chapter 10-3: Managing Your Money

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Consumer ServicesChapter 10-3 Managing Your
Money
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Careers related to this topic

• Credit counselor
• Account manager
• Financial planner
• Family economics specialist

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When selecting a financial institution, you will
want to consider its services.

• Saving Accounts
• Checking Accounts
• Debit Cards
• Automated Teller Machines (ATMs)
• Loans
• Certified and Cashiers Checks
• Travelers Checks
• Safe-Deposit Boxes
• Other Services-Credit Cards, Drive-up windows,
  Online Banking

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Savings Accounts

• Savings accounts can protect extra money and make
  it earn money for you by collecting interest.
• Savings accounts can be used to save for a major
  goal, such as college education or a car, or to
  save for emergencies.

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Interest

• Interest is the money a financial institution
  pays at regular intervals for the use of your
  money.

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Checking Accounts

• A check is a written order to a financial
  institution to pay a specific amount of money.
• Checking accounts are sometimes called demand
  deposits. That is, money in them is available on
  demand.

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Debit Cards

• A debit card shows that you have an established
  checking account with the financial institution
  identified on the card.
• Swiping the card immediately transfers payment
  from your checking account.

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ATMs

• An automated teller machine (ATM) is a machine
  for withdrawing and depositing money.
• An ATM offers people the flexibility of banking
  at any time.
• Electronic banking lets you use a phone or
  computer to check on your account, pay bills, and
  transfer funds to other accounts.

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Loans and Charge Accounts

• There are two types of credit loans and charge
  accounts.
• Loans are when you borrow money from financial
  institutions and then pay it back.
• Charge accounts are when you receive your
  purchase now and pay a store or credit card
  company later for what you owe.

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Other Services

• Certified and Cashiers Checks
• A certified check is simply a personal check for
  which the financial institution guarantees
  payment.
• A cashiers check is a check drawn on the
  financial institutions own funds. You present
  the money and the institution issues the check.
• Travelers Checks
• Safe-Deposit Boxes

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Depositing Money

• You open a checking account by making a deposit,
  or putting money into an account.

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Depositing Money

• Deposit slipA slip of paper you fill out in
  order to deposit a check or cash into a bank
  account.
• Endorse To sign over your rights to a check by
  writing your name on the back.

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Reconciling

• When you receive your statement you need to
  reconcile your account.
• Reconcile means that you need to make sure that
  your own records and your bank statement are the
  same. This may also be called balancing your
  checkbook.

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Credit

• Credit is an arrangement that lets you buy things
  now and pay for them later.

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Credit Rating

• Credit rating A record that shows your ability
  and willingness to pay your debts.
• Companies called credit bureaus keep track of
  your record of paying debts. A poor credit rating
  can stop you from getting more credit in the
  future and may cause you to pay higher interest
  rates.

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Creditors

• Creditors are people or companies to whom you owe
  money.

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Who is a Consumer?

• A consumer is someone who buys and uses goods and
  services produced by others.
• Being a wise consumer means being able to
  determine the right products and services and
  being able to find a good price.

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Comparison Shopping

• Comparison shopping involves taking time to
  compare products, prices, and services.

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Impulse Buying

• You want to avoid impulse buying which
  is making unplanned purchases on
  the spur of the moment.
• Stores promote impulse buying with eye-catching
  displays. Impulse items are often placed close to
  the front of the store so you notice them as you
  enter. Theyre also placed near checkout
  counters, tempting customers as they wait in
  line.

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Look Before You Buy

• Name brand or store brand? Sometimes name brands
  only cost more because they spend more on
  advertising, not because they are better
  products.
• Read product labels.
• Ask about warranty and return policy.
• A warranty is a written guarantee that a product
  will work properly for a specified length of time
  unless misused or mishandled by the consumer.

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Creating a Budget

• A budget is a plan to help manage your money
  wisely.
• When you make a budget, you set up guidelines for
  spending money on things that are worth the time
  and effort you put into earning the money.

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• Budgets are designed to reflect income and
  expenses for a given period of time.
• A few basic steps for setting up a budget are
• Set goals for your spending
• Determine sources of income
• Estimate your expenses
• Compare Income and Expenses
• Write the Budget and Keep Records
• Evaluate the Budget

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Income Expenses

• Income is the amount of money you have coming in.
• Expenses are the goods and services that you
  spend money on.

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Types of Expenses

• Fixed expenses expenses that cost a set amount
  that you are committed pay.
• Mortgages
• Rent
• Insurance
• Savings
• Flexible expenses costs that occur repeatedly,
  but vary in amount from one time to the next.
• Food
• Clothing
• Recreation
• Transportation

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Have a plan

• Financial planning the process of defining
  goals, developing a plan to achieve them, and
  putting the plan into action.

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Financial Planning Steps
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What is cash flow?

• A measure of the money you receive and the money
  you spend.