Download - Personal Finance Presentation
Who are we?
Why are we here?
►We believe in the value of financial knowledge
►You are Leaders– Good habits– Good skills– Desire to succeed– Opportunity– Knowledge
Expectations
►An introduction to personal finance
►Be involved
Take a Leadership role in your personal finance
Those who do
►Opportunity►Comfort►Security►Freedom
Those who don’t
►Limited Options►Stress►Fear►Lack of Opportunity
Why people don’t take care of their finances
Excuse
► I am young, I don’t need to worry about it
► I have a good job and will only make more money
► Whose to say I wont die tomorrow
► I work hard, I have earned it
► I don’t make enough money to save, plan, etc
Fact
► You are young, and dealing with it now is the best time
► Many of us will change careers
► The average life expectancy is 82 years old
► If we don’t save, we will be working forever.
► If we could be making more money, we would be
Important Areas
►Credit
►Credit Cards
►Retirement
►Savings
►Planning
►Budget
We need to plan for all of these!
Budgeting
►What do you think of when I say budget?
What Is a Budget
Why Is A Budget Important
►Helps you achieve your goals
►Helps you stay in control
►Helps you stay motivated
►Personal benefits– Marriage– Family
Expectations
►It may seem tough
►Takes time
►You may fail
►You may not like what you see
SUMMARY
►Written summary of your expenses vs. income.
►Plan for your money
►Important Information
►Its worth doing
►A key to reaching your goals.
Credit
►The Credit Report
►The Credit Score
►Credit Cards
What is a Credit Report?
►Transcript of your credit history
Why Your Credit Report Is Important
Who checks it Why it is important
Summary
►Your credit report is your credit transcript
►Lenders use this to judge you
►Get a copy of your report from the big three
►Correct any inaccuracies
THE CREDIT SCORE
What Is A Credit Score?
►Your numerical grade– Created by using the
information found in your credit report
►Always changing►Complex system
Why Your Credit Score Is Important
Dollars & Cents
►Home Price• $165,000 Loan• 30 Year fixed
Over $76,500 difference
CREDIT CARD DEBT
Negatives of Credit Card Debt
High Interest Rates
13.5%
6.25%
7%
Over Spending
►Average cash purchase $4.50
►Average credit card purchase $7
ACTUAL COST OF CREDIT CARD PURCHASES
True Costs Of Purchases
►All credit card purchases are at premium if not paid off in full
For Example
Results
$5,000 Original balance
$3,664 Interest paid
$8,664 Total payments
230 months of payments
Double the Minimums
Results
$250 vs. $125
23 months
$660 in interest
Savings
207 payments$3,000 in interest
Credit Summary►True cost of credit cards is high►Paying the minimums will be a long expensive road►Extra payments have a tremendous positive impact►High interest rates►Your score is who you are to lenders►A good score can save you thousands in interest
payments►Your credit report is your credit transcript►Lenders use this to judge you
Retirement
WHY IT IS IMPORTANT TO
PLAN FOR RETIREMENT
Shifting Responsibility
Traditional Retirement
Your Retirement
The Importance of Starting Young
When 1+1 = 5Person A:Starting @ 25 for 10 years
Person B:Starting @ 35 for 30 years
Compound Interest
Interest OnInterest
Year Simple Compound
1 1080 1080
2 1160 1166
3 1240 1254
4 1320 1359
5 1400 1467
6 1480 1584
7 1560 1710
8 1640 1847
9 1720 1994
10 1800 2153
Long Term Compounding
Time Is More Valuable Than Money
►Person A– Invested for 10 years– Invested $30,000– $467,000
►Person B– Invested for 35 years– Invested $90,000– $367,000
Retirement Summary
►Every dollar saved today is more valuable than the dollar saved tomorrow
►Today is the cheapest day to start saving
►Retirement is not going to just happen
►We need take responsibility for our retirement because no one else will
►We need to start now to make it happen
THE IMPORTANCE OF SAVINGS
Foundation For Success
Safety Net
The Purpose of An Savings
Results of No Emergency Fund
Summary
►A safety net
►Insulate you from life's unknowns– Unexpected expenses– Loss of a job
►You are Leaders– Good habits– Good skills– Desire to succeed– Opportunity– Knowledge
QUESTIONS AND ANSWERS
Thank You
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