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Budgeting and future expenses. Personal Finance http://finance.yahoo.com/news/the-10-unhappiest-jobs-in-america.html. I. Location, location, location. After college hopefully your job will allow you the independence you will need However, it may force you to move to another state or city

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budgeting and future expenses
Budgeting and future expenses

Personal Financehttp://finance.yahoo.com/news/the-10-unhappiest-jobs-in-america.html

i location location location
I. Location, location, location
  • After college hopefully your job will allow you the independence you will need
  • However, it may force you to move to another state or city
  • A. Generally, northern & western states cost anywhere from 2 to 5 times more (NY, LA, Chic., Bos., Philly, SF, SD, Sea, DC)
  • B. Southern, plains to mid western states are cheaper (Dal, atl, jax, tampa, New Orl., Charlo, birm., etc…)
  • C. Generally, suburbs are cheaper than most inner city living (especially in typical big cities)
  • D. Certain things unnecessary in big cities, car, car ins., paying for gas, looking for & paying for parking, car repair etc…
  • http://homes.yahoo.com/news/america-s-10-hippest-cities.html
ii how to read my pay stub
II. How to read my pay stub!
  • A. Your future paycheck will have many twist and turns before it lands in your hand:
    • 1. Gross pay: the amount your are paid by your employer
    • 2. Net pay: your actual pay after taxes
      • a. Federal income tax: by federal government (16th amendment) 10%-35%
      • b. FICA: Soc. Sec. & Medicare (FDR & LBJ) 7.65% tax
      • c. State tax: varies from state to state; GA = 1-6%
iii savings
III. Savings
  • A. Terms:
    • Risk: how safe of an investment it is
    • Return: the increase in the value of the original sum over time
  • B. Savings account: a deposit account for funds that are expected to stay in for a short term. Very low risk (FDIC), and very low return great for over-draft protection!
  • C. Money Market Account: a savings account for larger deposits than savings account, low risk (FDIC), low return, bit larger interest, but limited access
  • D. Certificate of Deposit (CD): Loans investors/people make to financial institutions such as banks for set amount of time (maturity) decided by investor/person; There is a penalty for cashing in early, Considered low return, very little risk due to (FDIC)
  • E. Other long term investments (more for retirement): Mutual funds, IRA, 401 K, stocks, bonds
iv housing owning vs renting
IV. Housing: Owning vs. Renting
  • A. Ownership:
    • 2 things necessary for a good home loan:
      • Good credit history
      • 20% down payment (recommended)
  • B. Until then Renting allows you: flexibility, short lease, mobility, no liability for physical up-keep of place
  • C. Ownership: ownership/pride, building equity, investment, asset, credit history, tax credit/deduction:
  • D. Types:
    • 1. Apartment: rental units, usually 1-3 bedrooms, two baths, pool, amenities, no water, trash fees, outside parking, location!
    • 2. Condo/townhome: no outside maintenance, less privacy, extra fees, amenities, ownership, investment
    • 3. House: ownership, investment, no amenities (sub.), landscape work, lots of upkeep, equity
v housing mortgage car
V. Housing: Mortgage & car
  • A. Traditional mortgage: money borrowed which would be paid back until loan paid off: principal + interest
    • 1. Usually 30/15 years, 20% down
    • 2. Also added and paid as escrow account:
      • a. Property taxes: county & city tax
      • b. Home insurance: property & personal protection
  • B. Rent for leasing:
    • 1. Apartment or townhome/condo or house:
      • a. Can include partial utilities, amenities
  • C. Car loan: usually for 5 years, down payment, paid back=principal + interest
    • 1. Car insurance:
      • a. Full coverage: covers your car & other person; recommended for cars bought on loans
      • b. Liability: only covers other car; recommended for older cars bought in full without payments
vi interest
VI. Interest
  • A. Price of borrowing money:
    • 1. What we are paid when we make investments such as savings, money market account, checking, etc…
    • 2. two types:
      • a. Simple interest: borrowing fee which is a % multiplied by principal and added to principal when loan paid back
      • b. Compound interest: when the interest is rolled into principal (monthly, annually), and increases principal for the length of the (maturity) loan
    • B. Also, what we pay when we borrow money (mortgages, car loans, student loans etc…)
vii credit
VII. Credit:
  • A. What is it? A way to obtain money you do not have
  • B. How do you get it? To get it, one must convince financial institutions to provide a loan with the promise form you to pay back borrowed money plus additional charge called interest
  • C. Can it help? Yes, used in a smart way can be help to you now and future, no, used in stupid way can result in harassment from creditors, broken relationships & bankruptcy
  • D. How do financial inst. decide who gets it? 3 Cs of credit:
    • 1.Character: are you worthy? (based on credit report), your history
    • 2. Capacity: income from job covering the bill month to month
    • 3. Collateral: loan be secured with collateral to repay the debt
viii insurance
VIII. Insurance
  • A. Used to manage risk in different areas of life:
    • 1. Health: for doctor visits; includes premium, co-pay, deductible
    • 2. Car: see previous slide
    • 3. Disability: AFLAC! Helps pay for things for a period of time while you are physically disable and unable to attend work
    • 4. Life Insurance: money for remaining members of your family (spouse) in case of early death ($100,000, 250,000, 500,000 etc..)
    • 5. Property (home/renters): insurance for all property inside of a residential structure (fire, flood, storm, theft, etc…)
smaller items
Smaller items
  • Wanna talk about utilities, entertainment, personal, other debt, transportation?