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FINANCE, It’s a Personal Thing !

FINANCE, It’s a Personal Thing !. WHICH WAY IS NORTH ?. TIME IS MONEY $$$. BEN AND ARTHUR---BOTH SAVE AT 12% PER YEAR!. BEN STARTS AT AGE 19 AND ENDS AT AGE 27. ARTHUR STARTS AT AGE 27 AND STOPS AT 65. AGE. BEN. RETURN. ARTHUR. RETURN. 19. 2000. 2,240. 0. 0. 20. 2000. 4,749.

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FINANCE, It’s a Personal Thing !

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  1. FINANCE,It’s a Personal Thing ! WHICH WAY IS NORTH ?

  2. TIME IS MONEY $$$

  3. BEN AND ARTHUR---BOTH SAVE AT 12% PER YEAR! BEN STARTS AT AGE 19 AND ENDS AT AGE 27 ARTHUR STARTS AT AGE 27 AND STOPS AT 65 AGE BEN RETURN ARTHUR RETURN 19 2000 2,240 0 0 20 2000 4,749 0 0 21 2000 7,558 0 0 22 2000 10,706 0 0 23 2000 14,230 0 0 24 2000 18,178 0 0 25 2000 22,599 0 0 26 2000 27,551 0 0 27 0 30,857 2000 2,240 28 0 34,560 2000 4,749 29 0 38,708 2000 7,558

  4. RETURN ARTHUR RETURN AGE BEN 60 0 1,298,83 2000 861,317 61 0 1,454,69 2000 966,915 62 0 1,629,26 2000 1,085,18 63 0 1,824,77 2000 1,217,64 64 0 2,043,74 2000 1,366,00 65 0 2,288,99 2000 1,532,16 ...AND HE NEVER CAUGHT UP!

  5. 18% interest is not 3 times better than 6% interest!

  6. $1,000 one time investment, no withdrawal Age 25 to Age 65 (40 years) 800000 700000 600000 500000 400000 300000 200000 100000 0 18% 12% 6% 18% = $750,378 12% = $ 93,050 6% = $ 10,285

  7. Money Management Strategy: Financial Statements and Budgeting

  8. Long Term Save and Invest Future Income Lost Interest

  9. Major Money Management Activities Storingandmaintainingpersonalfinancialrecordsanddocuments. Creatingpersonalfinancialstatements(balancesheets andcash flowstatements of income and outflow). Creating and implementing a plan for spending, and saving (budgeting). 3-4

  10. Report Measure Maintain Provide

  11. Assets Liabilities Assets – Liabilities Net Income Fixed & Variable

  12. Future Emergency Fixed Variable Variances Flexible

  13. “Baby Steps” Step One: $1,000 in an “Emergency Fund” Step Two: Pay off all debt (except the house) utilizing the “ Debt Snowball” Step Three: 3 -6 months expenses (necessities only) in savings

  14. “Baby Steps” Step Four: Invest 15% of Household Income into ROTH IRA’s and Pre-tax retirement plans Step Five: College Funding Step Six: Pay-off Home Early Step Seven: Build Wealth! (Mutual Funds/ Real Estate)

  15. Written Cash Flow Plan Will and/or Estate Plan Debt Reduction Plan Tax Reduction Plan Emergency Funding Retirement Funding Charitable Giving Life Insurance Health Insurance Disability Insurance Auto Insurance Homeowners Insurance MAJOR COMPONENTS OF A HEALTHY FINANCIAL PLAN Teach My Children

  16. IAMNOWHERE I AM NOWHERE I AM NOW HERE

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