Get a Handle on Your Money - PowerPoint PPT Presentation

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Get a Handle on Your Money

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  1. Get a Handle on Your Money Revised 2006

  2. Your County Your Name Family and Consumer Sciences “Educating People to Help Themselves”

  3. Futures Contracts Collectibles Pyramid of Investment Risk Aggressive Growth, Junk Bonds, Stocks and Mutual Funds Increased Risk Real Estate High Quality Corporate Stocks, Bonds and Mutual Funds Life Insurance Investments Government Securities Insured Savings, Savings Bonds, Money Market Funds, Certificates of Deposits Goals Emergency Fund Budget Financial Records Credit Record Life Disability Health Property Liability Financial Plan Insurance Financial Foundation

  4. Cash Management $ Earn maximum interest on funds $ Maintain adequate funds to manage expenses, emergencies and financial goals $ Keep cash and credit purchases in line with budget limits $ Maintain purchasing power by exceeding inflation and taxes

  5. Tools of Cash Management $ Checking accounts $ Savings accounts $ Money Market accounts $ Certificates of deposit and government savings bonds

  6. Financial Institutions Commercial Banks Credit Unions Savings and Loan Associations Mutual Savings Bank BANK

  7. Checking and Savings Accounts Costs and Penalties Automated teller machine transaction fee Telephone, computer or teller information Maintenance fee on minimum-balance account Maintenance fee on average-balance account

  8. Costs and Penalties “Bounced” check Delayed use of funds Inactive account Excessive withdrawals Early withdrawal Check clearing waiting period Stop-payment order

  9. Overdraft Protection Automatic Funds Transfer Automatic Overdraft Loan Agreement

  10. Making Your Money Grow

  11. Savings versus Investing -- What’s the difference?

  12. Savings • Money set aside from current earnings • Money not currently needed • Money set aside temporarily • Return is usually lower • Safe, secure, convenient

  13. Investing Putting what you’ve saved to work to produce a higher return Money that is set aside to meet longer term goals Higher risk than savings

  14. Reasons Families Save Emergencies, seasonal expenses, major purchases Educate self or children Minimize taxes Retirement income Capital accumulation New Home Children’s Education Toys Candy

  15. Every Little Bit Counts

  16. Pay Yourself First (A little can add up) Save this each week At % interest In 10 years, you will have $ 7.00 5% $ 4,720 $14.00 5% $ 9,440 $21.00 5% $14,160 $28.00 5% $18,880 $35.00 5% $23,600

  17. Savings Options • Savings Accounts • Certificates of Deposit • Money Market Accounts • Government Savings Bonds • Treasury Certificates

  18. Low-Risk, Long-Term Savings $ Certificates of Deposit Fixed or variable rate $ U.S. Savings Bonds Series EE Series I

  19. Value of $1 Saved Once Interest Rate 4% 6% 8% 10% Years 5 10 20 30 1.22 1.48 2.19 3.24 1.34 1.79 3.21 5.75 1.47 2.16 4.66 10.06 1.61 2.59 6.73 17.45

  20. Value of $1 Saved Yearly Interest Rate 4% 6% 8% 10% Years 5 10 20 30 5.42 12.01 29.78 56.08 5.64 13.18 36.79 79.06 5.87 14.49 45.76 113.28 6.11 15.94 57.27 164.49

  21. Save $1,000 a year @ 4% for 20 years = $29,778 You earned $9,778!!!

  22. $25 a month or $300 a year @ 4% interest for 20 years = $8,933 You earned $2,933!!!

  23. Finding $1,000 To Save $ 60 clothing/dry cleaning 60 phone bills 120 groceries 180 entertainment 160 collect coins ($3.20 each week) 360 meals away from home 60 coffee/sodas $1,000 SAVINGS

  24. Painless Ways To Save • Pay yourself first • Reinvest interest and dividends • Set realistic goals • Be yield conscious • Keep it simple • Keep cash reserves to minimum • Use payroll deduction plans

  25. Painless Ways To Save • Continue to make loan payments into savings after debt has been paid • Try a crash savings diet by purchasing only bare necessities • Kick a habit and save the money • Adjust your tax withholdings and save the difference • Save windfall money from lottery, inheritance and gifts • Save money from pay raise, bonus or working overtime • Start a part-time job and save the money

  26. Get a Handle on Your Money

  27. Your County Your Name Family and Consumer Sciences “Educating People to Help Themselves”