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This program will help you: Live the Lifestyle YOU Want. Introduction. If you invest as little as $100 per month, you could become a millionaire. This works according to the principle of compounding interest. What would you do with a million dollars?. WHY SHOULD I LEARN MONEY SKILLS?.
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Introduction • If you invest as little as $100 per month, you could become a millionaire. • This works according to the principle of compounding interest. • What would you do with a million dollars? WHY SHOULD I LEARN MONEY SKILLS?
Setting Goals DREAMS AND GOALS • The most important thing money can provide me is: ?
Motivate Yourself MOTIVATION • What does this word mean to you? • What motivates you to get money? • Why?
Finances and Your Life HOW FINANCIAL SKILLS IMPACT YOUR LIFE • Lifestyle • Help others • Free time • Reduce stress • Make the worlda better place
Dreams into Goals GOALS vs. DREAMS • Dream = Something you hope but not planned. • Goal = A person’s dream written down, with a detailed plan. • Write down your goals for each time frame: • 1 year__________________ • 5 years_________________ • 10 years________________ • 20 years________________
Goal Setting Proper Goals Are: • Specific • Measurable • Attainable • Result-orientated • Time-driven “Our goal was to travel to Italy”
Reaching Your Goals To Reach Your Goals, Remember: • To Create a plan • To Review goals often • To Visualize • The Law of Attraction See it, Believe it, Plan it, Do it!
Budget Let’s Learn To Budget • What percentage of lottery winners wastes all their winnings within a few years? Answer: 70% • How many NBA and NFL players are broke or bankrupt within 5 years of retirement? Answer: More than 60%.
Benefits of Budgeting Budgeting Provides For: • Control • Organization • More Money • Opportunity
Financial Decisions People with no money skills often make poor financial choices, regardless of how much money they have.
Hidden Costs Costs of Renting • What expenses (besides rent) must you pay each month when you rent an apartment? • Electricity • Gas • Water, sewer, trash • Cable TV and Internet • Repairs • Renter’s insurance • Furniture/appliances
Hidden Costs Automobile Costs • What expenses (besides car payment) must you pay each month when you buy a car? • Gas • Insurance • Registration • Maintenance
BBBPhilosophy Budget Before Buying PhilosophyBBB! • Always budget all the costs of an item before you purchase it to ensure it is affordable.
Banks Banking Essentials • How do banks work? • What is the difference between a bank and a credit union?
Banks Banking Essentials • Open a checking and savings account. • Set up direct deposit. • Set up auto bill pay. • Save and invest automatically every month.
Banks AutoX System
Building A Credit History • Building good credit can save you over $100,000 in your life. What would you do with a $100k?
Building A Credit History WAYS TO KEEP A HIGH CREDIT SCORE • Pay bills on time • Keep debt low • Insurance • Protect yourself from identity theft • Use credit wisely to build credit history
Credit and Loans CAR LOANS • How will you be treated if you have a good credit history? • How will you be treated if you have a bad credit history? • How does that make you feel? • What can you do to avoid paying more for your car loan?
Credit WHAT IS CREDIT? • Do you think people are more likely to buy something they do not need when they use a credit card? ?
Credit HOW CREDIT WORKS • Difference between a debit card and a credit card. • Credit card companies charge interest • That’s how they make their money • How can you avoid paying interest?
Credit WHY DO PEOPLE HAVE CREDIT CARDS? • Build credit rating • Pay in full each month • Have 6 months of bills in savings • Have a working budget • Control spending
Loans COLLATERAL • Low-risk loan • High-risk loan • Car loan: collateral = the car • Car value – down payment = collateral
Loans LOAN QUALIFICATION • To qualify you for a loan, lenders look at: • Income • Debt • Credit history • Assets • Job stability
Passions FOCUS ON PASSIONS • What are some careers available for people with a passion for… • Sports? • Entertainment? • Media?
Career PREPARE NOW FOR YOUR DREAM JOB • Understand job descriptions. • Review skill sets. • List skills and training you need. • Create a timeline to get your dream job.
Investment • What does investing mean to you?
Investment WHY PEOPLE INVEST • Financial security • Lifestyle • Retirement • Beat inflation
Cash Flow CASH FLOW TERMS • Positive cash flow • Negative cash flow • Breakeven cash flow • Assets • Liabilities • Net Worth
Investment Plan What net worth will you need to retire with a future income of… • $60,000? • $150,000? • $450,000?
Investment Plan CREATING A PERSONAL FINANCIAL PLAN • Decide how much money you need • Write goals • Create a savings plan • Build a solid foundation • Team of trusted advisors • Step-by-step, diversified, flexible plan
Investment Plan WHY DIVERSIFY? • Reduce overall risk • Protect from total loss
Investing BASIC INVESTMENT TYPES • Bonds • Money Market • Gold, Silver, Metals • Stocks • Real Estate • Businesses Become an expert in investing! Start making money you while you hang out with friends, travel and even while you sleep.
Investing COMPOUND INTEREST • Compounding interest allows your money to grow. • The younger you start, the larger your money can grow.
Investing CALCULATING RETURN • Earn interest on the money you save. • Earn interest on the interest. • The rule of 72 Grow your money!
Investing If you start investing $100 per month before you’re 21, you have an excellent chance of becoming a millionaire.
Imagine What would you like to do with your million bucks? ?
Insurance WHAT IS INSURANCE? • Insurance is an agreement that protects you or your property in the case of injury, damage, or theft. • Insurance protects your investment. If anything happens to something covered by your policy, the insurance company will pay for replacement, repair, or a cash settlement. • Why do people purchase insurance? To protect: • Cars • Homes • Health (medical, dental) • Liability • Belongings (renter’s insurance) • Life • Why are these important to cover?
Insurance INSURNACE BENEFITS • Protects you. • In cases of medical emergencies or accidents, insurance can provide access to doctors, medication, and other things you need to remedy the situation. • When you insure your car, the insurance company pays to repair damage to the vehicle. • Protects your family. • It gives you peace of mind knowing your family will be provided for if you pass away. • Protects your assets and income. • Having insurance can protect your assets and income in cases of accidents and lawsuits. • Insurance can significantly reduce costs of having to pay for major disasters on your own. • Protects your credit. • If you are issued judgment from a lawsuit, your credit rating will be affected negatively. • Protects items you own. • Belongings you insure can be replaced if something happens.
Insurance INSURNACE GAME If you roll: Doubles (1s through 5s) – nothing, you are extra safe and get 1 extra ticket. 3 – You fall and hurt your leg. If you have medical insurance you pay 1 ticket. If you do not you pay 4 tickets. 4 – You get into a car accident. If you are insured you pay 1 ticket. If you are not you pay 6 tickets. 5 – Your apartment is broken into. If you are insured you pay 1 ticket. If you are not you pay 5 tickets. 6 – You get the flu and need prescription antibiotics and a blood test. If you are insured you pay 1 ticket. If you are not you pay 4 tickets. 7 – Someone hits your car in a parking lot. If you are insured you pay 1 ticket. If not, 3 tickets. 8 – A pipe bursts in your apartment and ruins your couch and TV. If you are insured you pay 1 ticket. If you are not you pay 6 tickets. 9 – A rock hits your car and breaks your windshield. If you are insured you pay 1 ticket. If you are not you pay 5 tickets. 10 – You trip and fall and sprain your ankle. You need crutches, an x-ray, and pain medication. If you are insured you pay 1 ticket. If you are not you pay 8 tickets. 11 – You want to get a flu shot. If you are insured you pay 1 ticket. If you are not you pay 3 tickets. 12 – The roof collapses and damages all your belongings. If you are insured you pay 1 ticket. If you are not you pay 10 tickets.
Insurance INSURANCE TYPES • Health: Includes medical, dental, and vision. Health insurance is a must. If you don’t get sick often, choose cheaper forms of insurance. • Automobile: Insures both you and your vehicle and is a must. Talk to your insurance agent about adequate coverage. • Renter’s Insurance: Covers personal belongings in your rental. Important for those who have nicer things. • If have a 20-year-old TV and a couch you found in the alley, renter’s insurance may not be so important. • Property Insurance: Covers any properties that you own and is a must. • Umbrella Policies: Provide additional coverage on your existing insurance policies plus other protections. • Suggested for those with substantial assets. • Life Insurance: Provides coverage to your loved ones in case of your death. • Especially important for those with families.
Insurance AUTO INSURANCE • You must have auto insurance to avoid extreme risk to you, to others, and to your future finances. • If you have an accident without insurance you can face judgments for huge damages. • Your wages can be garnished until the damages are paid—which could take years! • Shopping for auto insurance: • Get quotes on the Internet or by phone. • Compare policies carefully to make sure coverage is the same. • Bottom line: Younger drivers pay more for insurance. To lower insurance costs: • Good driver discounts • Choice of car
Business Relations MENTORS • Mentors can: • Help you get a job • Provide personal advice • Act as a support system • Help you get into college • Who can be your mentor? • Professors • Business professionals • Family friends • Anyone with experience and expertise in areas that you are interested in.
Business Relations GAME A man was at restaurant feeling poor he sees a rich man take a stack of hundred dollar bills out his pocket to pay the cashier. The poor man says to the rich man "I know all the songs known to man." The rich man laughed and said, "I bet you all the money in my pocket that you can't sing a song with my daughter's name in it, Sarah Lee Greyson." The poor man went home rich and the rich man went home poor. What song did the man sing?
Business Relations ELEVATOR PITCH • Having an elevator pitch ready prepares you for opportunity. • What makes you, your business idea or other thing that you are interested in unique? • What message do you want to tell your market or your potential advisors/network? • What is the project that you are working on? • What is your elevator pitch?
Social Enterprise ENTREPRENUERSHIP AND YOU? • Lifestyle – The personal freedoms associated with being an entrepreneur are unrivalled by many other jobs. • Choose who you work with – Perhaps, the greatest point to working for yourself is you get to choose who you work with and do business with. • Financial Rewards – Business owners have the ability to control how much they earn. When you want to make more money, you simply work more efficiently. • Tax Benefits - There are several tax benefits business owners enjoy, which helps them to keep more of the money they earn. • Growth of your skill set - Being a business owner means that you are responsible for everything that happens within your company.
Social Enterprise ENTREPRENUERSHIP AND YOU? • Financial Insecurity – In life it is important to take the rough with the smooth, and owning your own business is no different. • Health Insurance –Employee health plans and any other benefits you get with a regular 9-5 job are now your responsibility, and can reduce your bottom line. • Decisions, decisions - Though being the decision maker is a key benefit of entrepreneurship, it can also be difficult. All the decisions of the business fall to you. Setting up an office, hiring staff, marketing your business - everything depends on you. You will build a network of advisors in time, but at the beginning, this can be challenging.
Social Enterprise MAGAZINE ENTERPRISE • As a class you need to generate $6,400 in income based off of the budget below. • Budget: • Office Rent: $2,000 • Staff: Writers, Illustrators: $1,500 • Utilities: $500 • Cost to Print Magazine: $1,200 • Total Expenses: $5,200 • Savings goal: $1,200 per month.
