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Family Economics and Financial Education

Family Economics and Financial Education. VALUES, NEEDS, WANTS, AND GOAL SETTING ESSENTIALS. WHAT IS A VALUE?. A value is a fundamental belief or practice about what is desirable, worthwhile, and important to an individual. What are examples of values?. Financial security. Helping others.

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Family Economics and Financial Education

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  1. Family Economics and Financial Education VALUES, NEEDS, WANTS, AND GOAL SETTING ESSENTIALS

  2. WHAT IS A VALUE? • A value is a fundamental belief or practice about what is desirable, worthwhile, and important to an individual What are examples of values? Financial security Helping others Family Education A successful and/or satisfying career Religious commitment Honesty Good health

  3. VALUES Family Life Experiences Friends Are your values the same as the person sitting next to you? Teachers Law Religious affiliations Media Work/ Career

  4. VALUES Values guide a person’s needs, wants, and goals Values, needs, wants, and goals influence a person’s daily decisions Decisions affect an individual’s financial situation

  5. IMAGINE Letter to Myself Questions 1 and 2 What would the world be like if everyone had the same values?

  6. NEEDS vs. WANTS A need is something thought to be a necessity or essential items required for life • Examples of needs: • Food • Water • Shelter A want is something unnecessary but desired or items which increase the quality of living • Examples of wants: • Car stereo • MP3 player • Designer clothes

  7. NEED OR WANT?YOU DECIDE! • Clothing • Going to the movies • Going out to eat • A place to live • A car/truck • A computer • Owning an MP3 player • Cell phone • Owning a vacation home • Food • Everyone has different interpretations of needs and wants. • This is based on… • their personal values! Letter to Myself Questions 3 and 4

  8. WHAT IS A GOAL? A goal is defined as the end result of something a person intends to acquire, achieve, do, reach, or accomplish sometime in the near or distant future Identifying goals makes decision making easier

  9. HOW DO VALUES, NEEDS, WANTS AND GOALS RELATE TO FINANCIAL DECISIONS? Financial Decisions Decisions

  10. TYPES OF GOALS Education goals enable individuals to prepare for future success in the workplace Financial goals are specific objectives to be accomplished through financial planning Letter to Myself Goals Questions 5-7 Short-term goals are specified as less than one year Long-term goals are specified as more than one year

  11. SMART GOALS Financial and education goals should be SMART goals SMART Goals Specific Measurable Attainable Realistic Time Bound State exactly what is to be done Include how the goal can be measured Determine steps to reach the goal Do not set goals for something unrealistic State when the goal will be met

  12. SMART EDUCATIONAL GOAL • Goal – “I want to attend college.” • SMART goal – • Specific – I want to attend a four year college • Measurable – Because I want to attend a four year college, I will earn a B in algebra • Attainable – Because I want to attend a four year college, I will earn a B in algebra this semester • Realistic – Because I want to attend a four year college, I will earn a B in algebra this semester to prepare me for the college entrance exam • Time Bound – Because I want to attend a four year college, I will earn a B in algebra this semester to prepare me for the college entrance exam when I am a junior in high school

  13. SMART FINANCIAL GOAL • Goal – I want to buy a new car • SMART goal – • Specific – I plan to save for a down payment on a new car • Measurable – I plan to save $5,000 for a down payment on a new car • Attainable – I plan to save $5,000 for a down payment on a new car by saving $200 from every paycheck • Realistic – It is realistic to save $200 from each paycheck for a down payment on a car because I usually waste the money on unnecessary items instead of saving it • TimeBound – I plan to save $5,000 for a down payment on a new car by saving $200 from each paycheck for two years.

  14. WHAT IS MISSING? • Find the missing SMART goal element (specific, measurable, attainable, realistic, or time bound) for each of the following financial goals • Financial Goal #1 • I plan to save $5,000 for college living expenses in four years. Attainable

  15. WHAT IS MISSING? Measurable • Financial Goal #2 • I plan to save for a new computer by saving $150 each month for one year.

  16. WHAT IS MISSING? Specific • Financial Goal #3 • I plan to save $2,500 by saving $105 each month for 2 years.

  17. WHAT IS MISSING? Time Bound • Financial Goal #4 • I plan to save $1,500 to buy a used car by saving $75 from each paycheck.

  18. WHAT IS MISSING? Realistic • Financial Goal #5 • I plan to save $2,000 to pay for a new computer by saving my whole paycheck for the next 6 months.

  19. WHY IS IMPORTANT TO WRITE SMART GOALS? Letter to Myself Question 8 Practice writing SMART goals!

  20. SUMMARY A value is a fundamental belief or practice about what is desirable, worthwhile, and important to an individual A need is something thought to be a necessity or essential items required for life. Examples include food, water, and shelter A want is something unnecessary but desired or items which increase the quality of living A goal is defined as the end result of something a person intends to acquire, achieve, do, reach, or accomplish Wants Values Needs Goals

  21. SUMMARY Values guide a person’s needs, wants and goals This influences a person’s daily decisions, which may affect their financial situation • Goals should be written down as SMART goals • Specific, measurable, attainable, realistic, and time bound

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