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Manage Your Money WISELY

a. Welcome to. Manage Your Money WISELY. Tracking your money. © 2011. Money WI$E. A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP. Money Management Seminar. MoneyWI$E A joint financial education project of Consumer Action and Capital One. Money WI$E.

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Manage Your Money WISELY

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  1. a Welcome to Manage Your Money WISELY Tracking your money © 2011 MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  2. Money Management Seminar • MoneyWI$E • A jointfinancialeducationprojectof Consumer Action and Capital One. MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  3. The Money Management course will give you... • An understanding of what good money management is and why it is important • Skills and ideas to help you better manage your money MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  4. Money Management • Session One • (Two hours) MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  5. Course objectives • This seminar will help you understand: • How to prepare a budget • How to balance your accounts • How to cut back on expenses • Ideas for increasing your income • How to save more • How to set financial goals MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  6. In participants’ folders • Manage Your Money Wisely (brochure) • Checkbook Balancing Activity (worksheet) • Three Sample Profiles (class exercise) • Financial Goals Worksheets • Take-home Budget Worksheet • Money Management Seminar Evaluation Form MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  7. Money Management • What is money management: • Knowing how to save, spend and invest your money so that you and your family can successfully work toward your financial goals MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  8. Money Management activities • What activities go with money management? • Tracking your spending. • Making a budget. • Balancing your checkbook. • Using credit wisely. • Setting long- and short-term goals. • Earmarking money for savings. MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  9. Be a wise money manager • Wise money management can help you: • Pay your bills on time. • Make it through times when you are not working. • Save money. • Plan for short- and long-term goals. MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  10. Budgeting • What is a budget? • A spending plan to help you forecast and control your expenses. MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  11. Making a budget • How do you make a budget? • You need to figure out how much you spend each month and compare that amount to your take-home pay. • Track your spending for a set period of time, like a month, in order to figure out how much money you spend. MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  12. Tracking your spending • What are some ways to track how much money you are spending each day, each week, or each month? MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  13. Ways to track spending • Keep a notebook handy and write down everything you buy and every bill you pay. • Keep all your receipts in an envelope or shoe box. • Create a computer file for entering your income and expenses. MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  14. Your budget • What are some of the things that should be included in your budget? MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  15. Your budget may include: • Housing • Food (groceries, restaurants, snacks) • Automobile (payments, gas, repairs, insurance, commuting expenses) • Clothing & personal grooming • Utilities (electric, gas, water, cable) • Credit card payments MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  16. Your budget may include: • Student loan payments • Child care • Insurance payments • Entertainment (movies, concerts, books) • Medical bills • Vacations • Income taxes MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  17. Making your budget work • Does your income cover your expenses? • If not, you need to figure out how to spend less or earn more. MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  18. Bank accounts • A bank account is an important money management tool. • How can a bank account help you manage your money wisely? MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  19. Bank accounts • A bank account helps you keep track of your spending and how much money you have available. • Use your checkbook register to write down and deduct: • Every check you write • Every ATM or debit card transaction or purchase • Any bank fees you pay MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  20. Benefits of a bank account: • Money is safe. • Each account is insured. • Canceled checks prove you paid a bill. • Having a bank account can save you money. MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  21. Let’s take a break • Please come back in 15 minutes. MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  22. Let’s balance a sample checkbook • Take out the checkbook balancing activity from your folders: • Review the sample bank statement. • Balance the sample checkbook register. • Balance the sample account using the checkbook balancing worksheet. MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  23. Cutting back on expenses • What are some ways to cut back on expenses? MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  24. Ideas to help you cut back • Shop around and compare prices. • Make a shopping list and stick to it. • Prepare meals and bag lunches at home. • Don’t shop recreationally—you could be tempted to buy things you don’t need MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  25. More ways to cut back • Use the public library for books, magazines, videos. • Join a buying co-op. • Lower your thermostat when away or sleeping. • Walk instead of drive. • Look for a free bank account. MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  26. Increase your income • Ways to earn extra money: • Part-time or weekend job. • Take advantage of income tax programs, such as the Earned Income Tax Credit. • Start a home-based business. • Rent out a room. MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  27. Setting financial goals • Short-term goal (1-2 years) — buying a new car, getting a degree or planning a wedding. • Long-term goal (5-10 years or more) — owning a home, starting a family, paying for college or retiring. MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  28. Working toward your goals • A savings plan allows you to work steadily toward your financial goals. • The take-home ‘Financial Goals Worksheet’ will help you figure out a savings plan that works with your particular goals. MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  29. Take-home activity • The Financial Goals Worksheet and Chart can be found in each of your folders. • Complete the worksheets at home. • Bring the completed worksheet back for the second session. • See you next time! MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  30. Money Management • Session Two • (Two hours) MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  31. Money Management • Welcome back! • In this session we will focus on saving, investing, insurance, credit and debt MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  32. Saving & investing • Let’s review your Financial Goals Worksheet. • Saving and investing can help you to reach your short-term and long-term goals. MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  33. How to save more • “Pay yourself first” by scheduling automatic deposits on pay day that go into your savings account or IRA (individual retirement account) MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  34. Retirement accounts • Does your employer offer a retirement savings plan? • Employer-sponsored plans can help your retirement savings grow faster because you do not have to pay taxes on the earnings until you are eligible to withdraw from the account, at age 59 1/2. MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  35. Saving - CDs • A CD (certificate of deposit) is a safe way to save. • Like savings accounts, CDs are insured by the government. • CDs often earn a higher interest rate than savings accounts do. • However, CDs require that you leave your money for a set period of time, such as six months or a year. MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  36. Investing • An investment is the use of money to create more money • Stocks, bonds and mutual funds are all types of investments • Consider an investment advisor. • Be cautious—investments are not government-insured and you could lose your money. MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  37. Insurance • What are the benefits of having insurance? • Insurance protects you against financial ruin as a result of an unforeseen catastrophe like fire, theft or medical emergency. MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  38. Kinds of insurance • What are the most important types of insurance for you and your family? • Automobile insurance • Health insurance • Homeowner’s or renter’s insurance • Life insurance MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  39. Saving money on insurance • Always ask if you are eligible for any insurance discounts. • Internet sites can help you compare premiums: • Insure.com (www.insure.com) • InsWeb (www.insweb.com) • Quick Quote (www.quickquote.com) • Lower Rate Quotes (www.lowerratequotes.com) MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  40. Credit • Good credit can help you: • Rent an apartment • Purchase a home • Get a job • Set up phone and power service. • Buy ‘big-ticket’ items without cash • Borrow money • Obtain a credit card • Rent a car MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  41. To build good credit... • Pay your bills on time. • If you carry a balance, pay as much as you can each month. MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  42. Rebuilding credit • If you have damaged your credit, try applying for credit with local businesses or for a secured credit card (a bank credit card backed by money you deposit in a bank account.) MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  43. Home equity loans • Home equity loans can be used to consolidate debt. • Be very careful before taking out a loan secured by your home (a home equity loan or line of credit). • If you fail to make a payment, you risk losing your home. MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  44. Good credit • Try to avoid these expensive credit options: • Pawn shops, pay day loans, and car title pawn shops • Offers to buy things on credit with deferred interest • Credit cards with rates higher than the national average (check www.bankrate.com for average) MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  45. Overwhelmed by debt? • The National Foundation for Consumer Credit - (800) 388-2227 or www.nfcc.org can refer you to a credit counselor in your area. Low- or no-cost services help you establish a repayment plan. • Debtors Anonymous (781) 453-2743; www.debtorsanonymous.org MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  46. Let’s take a break • Please come back in 15 minutes. MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  47. Money management activity • Break into small groups. • Review sample profiles. • Discuss how the people in the sample profile can get back on track. • Select a spokesperson from each group to present your ideas. MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  48. Take-home budget worksheet • In your folder you’ll find a budget worksheet. • Track your spending for a while and then complete this worksheet at home. • Keep yourself focused on creative ways to save money. MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  49. Questions? • Let’s try to answer some of your questions about money management. MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

  50. Now you can grade us! • Please fill out the seminar evaluation form and leave it with me on your way out. MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

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