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Financial Smarts

Financial Smarts. For Teachers. Sponsors. Personal Finances. Financial Security. Live comfortably Use credit appropriately Insure life/health/home Invest wisely Save for retirement. Path to Financial Security. Research Figure out needs Learn money management Seek advice Ask

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Financial Smarts

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  1. Financial Smarts For Teachers

  2. Sponsors

  3. Personal Finances

  4. Financial Security • Live comfortably • Use credit appropriately • Insure life/health/home • Invest wisely • Save for retirement

  5. Path to Financial Security • Research • Figure out needs • Learn money management • Seek advice • Ask • Are you satisfied with your circumstances? • How can you control your finances?

  6. Influences • Beliefs • Values • Attitudes • Expectations • Goals

  7. Determine • How you make financial choices • How your behavior needs to change

  8. Building Blocks • Foundation: Regular Income • Provides for basic lifestyle • Funds emergencies

  9. Building Blocks • Base • Checking account • Savings account • Money market account • Insurance protection • Employee fringe benefits

  10. Building Blocks • Establish • Long-term goals • Short-term goals • Financial records • Realistic budget • Emergency savings fund

  11. Building Blocks • Manage • Housing expenses • Transportation expenses • Insurance expenses • Income taxes • Contingencies

  12. Building Blocks • Handle • Credit cards • Installment loans • Savings accounts • Education costs

  13. Building Blocks • Invest • Mutual funds • Stocks and bonds • Real estate • Pension plans

  14. $700,000 $713,574 14% $600,000 $500,000 $482,665 12% $400,000 $328,988 $300,000 10% $226,556 $200,000 8% $158,116 $100,000 6% 0 10 30 20 Years Investing Value of investing$2,000 annually

  15. Budgeting Process Set Goals

  16. Budgeting Process Organize

  17. Budgeting Process Decide

  18. Budgeting Process Implement

  19. Budgeting Process Control

  20. Budgeting Process Evaluate

  21. Budgeting Process Evaluate Control Monitor Review Revise Implement Decide Organize Set Goals

  22. Budgeting Process Success!

  23. Step 1: Set Goals Long Term

  24. Step 1: Set Goals Short Term

  25. – What you own Net worth Step 2: Get Organized • Figure net worth • How do you determine value? What you owe

  26. – Expenses Cash flow Step 2: Get Organized • Determine cash flow Income

  27. Step 3: Create a Plan • Spending plan should be • A guide, not a master • Personal and unique • Practical and realistic • Flexible • Include some “mad” money 

  28. Step 3: Create a Plan • What do you plan to spend on • Food? • Housing? • Clothing? • Compare to actual expenses

  29. Step 4: Implement • Putting your financial plan together • Net worth • Income • Expenses • Goals • Budget • Alternative ways to reach goals

  30. Step 5: Control • Keep track of what you spend

  31. Step 5: Control • Rational spending(planned) • Well thought out • Controlled • Impulse spending • Unplanned spending • Spur of the moment

  32. Step 5: Control • Financial records • What’s important? • How long to keep? • Where are they kept? • Who else knows?

  33. Step 6: Evaluate • Manage your money • Control cash flow • Establish and manage credit • Buy appropriate insurance

  34. Step 6: Evaluate • Contribute to savings, investments • Minimize tax burden • Plan retirement • Plan estate

  35. Step 7: Revise Monitor Review Access

  36. Pay Yourself First

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