Will Work for Food Candy

1. Will Work for Food Candy 1. p.1 If you bring back the packet 2. p.2 If you wrote a plan… Discuss with family… 3. p.4 If you did the 1st week of 13-week Budget. 4. p.12 If you completed the five stocks.

2. Personal Management Merit Badge $ Lots of effort , but totally worth it!

3. HANDOUT • Fill in the blanks. • OR use your own pages. • You may use the words I’ll suggest, or - • You may use other words you like better! Brainless attendance

4. HANDOUT • Name ______________________________________ • Date of merit badge classes: 1st ____________ 2nd____________ To help you in the future: Keep it! Read again in 5 yrs! * • Boxed portions: To be reviewed with your Merit Badge Counselor. • AFTER you’ve completed EVERYTHING (ready to discuss)! • If I go too fast, stop me. • Bring this handout back next time:

5. p.2, Requirement #1: Do the following:1(a) Choose an item that your family mightwant to purchase that is considered a major expense. 1(b) Write a plan that tells how your family would save money for it. • We can save money by: _____________________________ _____________________________ Item chosen: _______________Approximate cost: ___________ HDTV $1,000 Mostly _______ earnings, but each of us could contribute.

6. p.2, Requirement #1b (continued): 1(b)1. Discuss the plan with your merit badge counselor.* 2. Discuss the plan with your family. **When are you going to do this? • (FHE, or?) 3. Discuss how other family needs must be considered in this plan. *When are you going to discuss this with your merit badge counselor?

7. p.2, Requirement #1c: c. Develop a written shopping strategy for the purchase: 1. Determine the quality of the item (using consumer publications or rating systems). _______________________________________ EBay, Amazon, Consumer Reports…

8. p.2, Requirement #1c: 2. Comparison shop for the item. Find out where you can buy the item for the best price. Call around Who you called: What you learned: ____________ ________________ ____________ ________________ Sleazy’s Pawn Shop Don’t go there!

9. p.2, Requirement #1c: 2. Comparison shop for the item. Find out where you can buy the item for the best price. Study ads Where you looked: What you learned: ________________ ____________________ ________________ ____________________ Newspaper Sears had a great sale Online sellers Include shipping costs…

10. p.2, Requirement #1c: Yes Did you find a great sale or a discount coupon? ________ ____________________________________________ Consider alternatives: Maybe, but________ Can you buy the item used? ___________________ I could, but… Should you wait for a sale? ___________________

11. 1st Week INCOME ExpectedActual Allowance ______ ______ Job ______ ______ Gifts ______ ______ _________ ______ ______ _________ ______ ______ _________ ______ ______ Total in ______ ______ EXPENSES & SAVINGS Expected Actual Donations ______ ______ Savings ______ ______ Savings (for… ______ ______ Save to Buy ______ ______ Junk food ______ ______ _________ ______ ______ Total Out ______ ______ Your expected income (allowance, gifts, wages), p.3 Req. #2a: Prepare a budget reflecting: Your expected expenses & savings. Track your actual.

12. INCOME ExpectedActual Allowance _____ Job _____ Gifts _____ _________ ______ _____ _________ ______ _____ _________ ______ _____ Total in _____ OUTGO Expected Actual Donations ______ Savings ______ Savings (for… ______ Save to buy ______ Junk food ______ ______ _________ ______ ______ Total Out ______ EXAMPLE $10 $10 $10 $30 $ 3 $ 3 $ 3 $ 3 $30 $42 2(b). Compare expected income with expected expenses (outgo). determine steps to balance: 2. If outgo exceeds income, I can increase income by ___________ working more or decrease expenses by_______________ buying lessjunk

13. INCOME ExpectedActual Allowance _____ Job _____ Gifts _____ _________ ______ _____ _________ ______ _____ _________ ______ _____ Total in _____ OUTGO Expected Actual Donations ______ Savings ______ Savings (for… ______ Save to buy ______ Junk food ______ ______ _________ ______ ______ Total Out ______ Another EXAMPLE $10 $10 $10 $30 $ 3 $ 3 $ 3 $ 3 $12 2(b). Compare expected income with expected expenses. 2. If expected income exceeds expected outgo, state how you would use the excess money: I could have some for __________________ better stuff later.

14. INCOME ExpectedActual Allowance _____ Job _____ Gifts _____ _________ ______ _____ _________ ______ _____ _________ ______ _____ Total in _____ OUTGO Expected Actual Donations ______ Savings ______ Savings (for… ______ Save to buy ______ Junk food ______ ______ ______ ______ Total Out ______ EXAMPLE $10 $10 $10 $30 $10 $20 $20 $50 $ 3 $ 3 $ 3 $ 3 $12 $ 5 $ 5 $ 5 $ 5 $20 $40 Presents What actually happened? This guy should have $10 more now than 1 week ago. If you finish one week of expected and actual by next class...

15. Income Source Actual ___________ _______ ___________ _______ ___________ _______ ___________ _______ ___________ _______ ___________ _______ Total _______ Expenses Where Actual ___________ _______ ___________ _______ ___________ _______ ___________ _______ ___________ _______ ___________ _______ Total _______ p. 3-7, Req 2aTrack youractual income, expenses, and savingsfor 13 consecutive weeks. • How are you going to remember to do this each day? (How about putting it on your pillow?) • Share this with your merit badge counselor.

16. p.8 Req. 3a, 3bDiscuss with your merit badge counselor Five of the following concepts: a. The emotions you feel when you receive money: * When I honorably earn money, I feel ______ Good If I’d stolen the money, I’d feel _____ Bad! b. How the amount of money you have with you affects your spending habits: If I have lots of money, I tend to spend ______ more. If I don’t have my money, it is ______ to spend. harder (Unless I have a credit card, then its easy to spend money I don’t have.)

17. p.8, Req. 3c c. Your thoughts when you buy something new: excited happy I usually feel ___________________ Your thoughts about the same item 3 months later: excited happy I’m usually less __________ about it.

18. p.8 Req. #3cDiscuss with your merit badge counselor Five of the following concepts: c. Explain the concept of: buyers remorse Often after buying something people feel _______ sorrow(remorse) and wish they could undo the _________. purchase Especially if they ________ $, when it is time to make payments, they feel sorry or have _______ _______. borrowed buyer’s remorse

19. p.8, Req. 3d, 3e 3d. How hunger affects you when shopping for food items: When hungry, I tend to buy . more 3e. Your experience of buying an item after seeing or hearing advertisements for it. Did the item work as well as advertised? ___ _______ Not always. Often, the ad makes it sound _____ than it actually is. better Once in awhile it is actually _____ than I expected. better

20. p8, Req. 3f. Your understanding of what happens when you put money into a savings account: teller’s drawer It goes into the ______________, bank’s safe bank’s bank then into the ___________ or into the ___________ loaned out or invested then, most of it gets ___________________ interest They pay me _______ for the use of my money. They can afford to because they charge the borrowers interest at a ______ rate than the rate they pay me. higher

21. Charitable Giving 3g. Explain its purpose and your thoughts about it: Good charities use money to help the ____ and _____, build buildings for __________ and other __________ purposes. poor sick worship worthwhile I think it is a _______ idea to give to a charity or church.

22. I can save _____ of my earnings for more important things I’ll need in the future. more p.8, Req. 3h. What you can do to better manage your money: I can use ____ of it for junk. less I can use my money for ____ worthwhile purposes. more

23. p. 9, Req. #4. Explain the following to your mb counselor:4a. The difference between saving and investing, including reasons for using one over the other. * • usually means: a ____ risk way to accumulate money. • “Saving” low- My father seemed to want me to save ever penny I got. I didn’t like that. But, I learned to stash 10%!

24. ExampleSave $100 each month at 5%

25. ExampleSave $100 each month at 5%

26. ExampleSave $100 each month at 5%

27. ExampleSave $100 each month at 5% • Now earning > $110+ each month

28. p. 9, Req. 4aThree Recommended Savings: 1. Save _____% in an Emergency Fund. 10 Try to never, ever spend this money! 2. Save enough for your “_____ ______” expenses. for sure Stuff you know you’ll be spending money on once a year! 3. Save whatever you can just to _____ ______ . buy stuff

29. ExampleSavings Goal:

30. Stocks & Bonds p. 9, Req. 4a. Explain the following to your Merit Badge Counselor:4a. The difference between saving and investing, including reasons for using one over the other. • “Investing”usually means ______ -risk with a hope of a ______ return. higher higher

31. p.9, Req. 4a (continued). Reasons for saving: People typically save money for future needs including ____________. emergencies Reasons for saving rather than investing: People who save money in a bank or credit union are much ____likely to lose it. And more likely to be able to get it when they ______ ___ less want it Banks and credit unions are usually very careful with our $, and (in some states—like Utah) our savings are insured by agencies of the U.S. Government: _____ & _______ FDIC NCUA

32. Stocks & Bonds p.9, Requirement 4a. Reasons for investing: People invest in hopes of earning ____ ______. more money Reasons for investing rather than saving: Although the risk of loss is higher, and some investments require lots more ______, some investments earn ___ _____ money. work lots more

33. p.9, Requirement 4b. 4b.Explain the concepts of return on investment and risk. expected Return on investment refers to the amount you receive __ _____ of the amount you invested. in excess (Why would anybody choose 5% when they could invest at 25%?) Risk is a measure of the possibility of suffering harm or ____. actual loss The higher the rate, the greater the ____. risk Also: The greater the rate claimed, the higher probability for _______. scams

34. p. 9, Requirement #4cExplain the concepts of simple interest and compound interest. Suppose you bury $1,000, and dig it up 20 years from now. Instead, suppose you put it in the bank and earn 5% for 20 years PRINCIPAL

35. p. 9, Requirement #4cSimple interest. You withdraw the interest, and if you bury your earnings Interest paid only on the ________ balance. Simple interest is: principal INTEREST P R I N C I P A L

36. p. 9, Requirement #4cExplain the concepts of simple interest andcompound interest. Now, suppose you have them add your interest to your balance. Compound interest: Interest paid on both the principal and previously paid _______ interest. Compound Interest Simple Interest Principal

37. p. 9, Req. 4c Explain how these (simple interest & compound interest) affect the results of your investment exercise (p.12). If I save or invest $1000 and I spend all the earnings as I get it, I do not get the advantage of _____________. compounding If I have my earnings added to the investment, I earn interest not only on the ________ but also on the ______ _________ principal prior earnings Thus, I get simple interest and compound interest.

38. p. 10, Req. 5Select 5 publicly traded stocks from the business section of the newspaper. [Or, internet] Explain to your merit badge counselor the importance of the following information for each stock: a. Current price: It is important to know how _____ an investor can buy, and help him decide much whether to ___, ___, ____, ____, or _____ a stock. buy sell trade hold avoid The current price may be obtained ______, from a ____ ______, or estimated from _________. on-line stock broker newspaper

39. p. 10, Req. #5bExplain to your MB Counselor the importance of: b. How much the price changed from the previous day: It is important to see if the price changed, and how _____, and whether it went __ or ____. much up down If it went down a lot, something might be seriously ______ with the company, wrong Or, something might be seriously ______ with the ______ _______ in general. wrong stock market

40. p. 10, Req. 5c. Explain the importance of: c. The 52-week high and the 52-week low prices: It is important to see if the price has been about the same, or ______, or _____ than it is now. higher lower If it went down a lot, something might be seriously ______ with the company, or with the stock market __ _______. wrong in general It might be a good time to ___. But it might be a good time to _____ __. buy avoid it a lot more [Knowing this is enough to realize you need to know __ ___ ______!]

41. Examplep. 10, Req. # 5 Obtain the business section of your newspaper

42. Examplep. 10, Req. # 5 Obtain the business section of your newspaper and obtain the following for 5 stocks: Usually buy 100 shares at a time. 10/2/04 Date of Newspaper: ________ Name1st stock Close Price Net Change 52-wk high “Name” “Last” “Chg” “1yrhi” ______________ _________ _________ ___________ Explain: The importance for this stock: Current price (est: _______) __________________________ Change from previous day: __________________________ The 52-week high: __________________________ DeltaAir 3.34 + .19 15.54 3.50 Low enough to buy a bunch Gain 19¢ per share (good) Lost $12.20 p/share: danger

43. ExampleShould I buy? (on 8/28/06: 68¢, then down to $0)

44. Example SATURDAY

45. p. 10, Req. # 5 Obtain the business section of your newspaper and obtain the following for 5 stocks:(I’ve already given you 1, do the other 4 by next class for another candy) Date of stock quote: ________ Name 2nd stock Close Price Net Change 52-wk high “Name” “Last” “Chg” “1yrhi” ______________ _________ _________ ___________ Explain: The importance for this stock: Current price (est: _______) __________________________ Change from previous day: __________________________ The 52-week high: __________________________

46. Will Work for Food Candy Make sure your wrappers get in the garbage!!! Honor System 1. p.1 If you brought back the packet 2. p.2 If you wrote a plan… Discuss with family… 3. p.4 If you did the 1st week of 13-week Budget. 4. p.12 If you completed the five stocks.