Money Matter$ f or IHSAA 2011 Student Leadership Conference

1. Money Matter$forIHSAA 2011 Student Leadership Conference

2. AGENDA • Pop Quiz!! • What is C.R.E.D.I.T.? • Credit vs. Debit • Managing Debt • Are you Creditworthy • Q&A

3. CREDIT POP QUIZ • What are the costs of owning and using a credit card? • The cost of my purchases only. • Interest and maybe an annual fee or late fees. • None, since credit cards are free. • 2. What might happen if I fail to meet several payments on purchases I made a year ago? • The item(s) purchased can be taken away from me. • Negative information may be added to my credit report and remain up to 7 years. • Knowledge of my poor payment history could result in another credit issuer’s denying the credit.

4. CREDIT POP QUIZ • Why is maintaining a good credit history important to my future? • Because my family will inherit it, and it’s important for me to plan for their future. • Because anyone can access my credit history at any time to learn more about me. • Because a good credit history can help me obtain a job, a loan, and other forms of financing.

5. CREDIT POP QUIZ • If I am denied credit based upon what I considered to be inaccurate information on my credit report, what is the best way to handle this situation? • Call the credit bureau whose report lists the error and explain why information is wrong. Then ask them to correct my report. • Obtain a copy of my credit report. Review and circle the error on my statement, return it to the credit bureau, and ask that a correction be made to my report. • Obtain a copy of my credit report from the credit bureau that provided information to the credit issuer denying me credit; then review the information for any errors. Write a letter to the credit issuer whose information I dispute, explaining why I think the information is inaccurate and asking that a correction be made to my report. Send a copy of the letter to the credit bureau, as well.

6. CREDIT POP QUIZ • If I find myself using my credit card to cover the cost of basic needs (like food or rent) because I’m regularly short on cash at the end of each month, what’s the best thing to do? • Ignore it. Things are bound to get better soon. • Add up all my monthly expenditures – like food, movies, clothes, and savings – then list all forms of income. Compare the two. If expenses are greater than income, I need to consider ways to reduce them and/or increase my income. • Continue to make regular, timely payments to cover at least the minimum amount requested. • Call Mom and Dad for an advance on my allowance.

7. CREDIT POP QUIZ • How do I protect myself from credit card fraud? • Do not give my name or other personal information, such as my address or salary, when applying for a credit card. • Be extremely careful about disclosing account information by telephone to unsolicited callers. • Purchase large amounts of credit insurance. • What are some signs of “credit stress?” • I am receiving calls from creditors about overdue bills. • I have written some post-dated checks lately to put off expenses. • I am arranging bills in order to put off some of them until next month or the month after that.

8. CREDIT POP QUIZ • What should I do if I find myself becoming financially over-extended? • Avoid calls from creditors, and then file for bankruptcy. • Get a loan from my parents or relatives, and hold expenses and income steady. • Use a budget, ask lenders to help me with a payment schedule, or seek professional credit counseling. • Hold up a sign at a televised sporting event that reads, HI MOM & DAD. PLEASE SEND MONEY!!

9. WHAT IS C.R.E.D.I.T. • Carrying a balance costs money; if you pay off your credit bill each month, it’s like a free and instant loan. • Records follow you everywhere; pay your bills on time to keep your credit report clean. • Errors occur, so check your report regularly to make sure it’s accurate.

10. WHAT IS C.R.E.D.I.T. Developing a budget and sticking to it discourages over-spending and helps you save. Information is power; keep yours secure, and give it out only when you make the call. Talk with your banker; in case of any problems, it’s the first step toward resolution.

11. CREDIT vs. DEBIT • What is a Credit Card? • An instrument that is issued by a bank or credit card company and have a fixed dollar limit. You can only spend up to that amount.

12. CREDIT vs. DEBIT • What is a Debit Card? • An instrument similar to credit cards, except they use money that an individual has in their checking account. Therefore, you can only spend the money that is in your account.

13. MANAGING DEBT • Questions to ask yourself: • Are you aware of all your monthly payments, and do you include them in your budget? • Do you pay your bills on time? • Have you accumulated more debt than you can comfortably pay each month? • Do you protect your credit information?

14. MANAGING DEBT • Warning Signs of Credit Trouble: • Are payments to creditors taking up more and more of your monthly income? • Have you lost track of how much money you spend each month on debt? • Do you pay late penalties often or every month? • Do you write post-dated checks? • Do you charge small expenses because you do not have the cash to pay for them? • Do you worry a lot about money?

15. ARE YOU CREDIT WORTHY?? The Four C’s of Credit: Character Capacity Collateral Credit History

16. ARE YOU CREDIT WORTHY?? • Steps to take to make yourself Creditworthy: • Create and follow a budget. • Open a savings or checking account. • Establish credit. • Permanent address for at least one year. • A regular job. • Pay your bills on time.

17. Q & A