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Glencoe Managing Life Skills Chapter 14 Manage Your Finances Chapter 14 Manage Your Finances 1 Section 14.1 Everyday Financial Management Section 14.2 Use Credit Wisely Chapter 14 Chapter Manage Your Finances 14 Slide 2 Glencoe Managing Life Skills Chapter 14 Manage Your Finances Chapter 14 Manage Your Finances 2 When you manage your finances responsibly, you think about your income, expenses, and taxes, as well as investing for your future. Section 14.1 Everyday Financial Management Slide 3 Glencoe Managing Life Skills Chapter 14 Manage Your Finances Chapter 14 Manage Your Finances 3 Content Vocabulary Academic Vocabulary gross pay net pay deduction interest debit card reconcile compound interest insurance 401(k) plan invest diversify shares Slide 4 Glencoe Managing Life Skills Chapter 14 Manage Your Finances Chapter 14 Manage Your Finances 4 Financial Fitness An essential part of becoming financially fit is to understand your paycheck and your bank accounts. Payment for work can be in the form of hourly wages, piecework, salary, and commission. Slide 5 Glencoe Managing Life Skills Chapter 14 Manage Your Finances Chapter 14 Manage Your Finances 5 Financial Fitness Deductions will be taken from a paycheck for federal and state and local taxes, Social Security, Medicare, savings plans, and benefits. deduction Anything that is deducted from gross pay. Slide 6 Glencoe Managing Life Skills Chapter 14 Manage Your Finances Chapter 14 Manage Your Finances 6 Income Taxes The biggest deduction is for federal income taxes. Tax forms can be downloaded and printed from the IRS web site. Have you ever filed a federal income tax return? Slide 7 Glencoe Managing Life Skills Chapter 14 Manage Your Finances Chapter 14 Manage Your Finances 7 Bank Accounts Banking can be done through ATMs, checks, debit cards, automated services, by telephone, and online. Each month, it is important to reconcile your account, or check it for accuracy. debit card A card that deducts the cost of a purchase from the users bank account at the time of purchase. reconcile To compare accounts for accuracy. Slide 8 Glencoe Managing Life Skills Chapter 14 Manage Your Finances Chapter 14 Manage Your Finances 8 Bank Accounts Banks pay you interest to use your money. Interest can be earned from compound interest and money market accounts. interest The fee the bank pays you for the opportunity to use your money. compound interest Interest that is calculated on the deposits you make and on the interest you have already earned. Slide 9 Glencoe Managing Life Skills Chapter 14 Manage Your Finances Chapter 14 Manage Your Finances 9 Prepare for the Future Being financially prepared is not just saving. It also involves buying insurance, planning for retirement, and investing for the future. invest Using money to participate in a business enterprise that offers the possibility of profit. insurance Financial protection in the case of loss or harm. Slide 10 Glencoe Managing Life Skills Chapter 14 Manage Your Finances Chapter 14 Manage Your Finances 10 Prepare for the Future Investing is a long-term view of your financial picture. Slide 11 Glencoe Managing Life Skills Chapter 14 Manage Your Finances Chapter 14 Manage Your Finances 11 Prepare for the Future Investments bring certain risks, which can be avoided by following a few rules. Investment options include CDs, bonds, stocks, and mutual funds. What steps can you take now to help plan for your financial future? Slide 12 Glencoe Managing Life Skills Chapter 14 Manage Your Finances Chapter 14 Manage Your Finances 12 There are different types of credit including cash loans, sales credit, and credit cards. Using credit has many financial advantages, but but it needs to be used wisely. Section 14.2 Use Credit Wisely Slide 13 Glencoe Managing Life Skills Chapter 14 Manage Your Finances Chapter 14 Manage Your Finances 13 Content Vocabulary Academic Vocabulary credit creditor finance charge credit report credit rating annual percentage rate (APR) principal terms Slide 14 Glencoe Managing Life Skills Chapter 14 Manage Your Finances Chapter 14 Manage Your Finances 14 Understand Credit Be responsible when using a credit card. Creditors expect you to pay back over a specified period of time for the money, goods, or services you purchase now. creditor Banks, finance companies, and stores that extend credit to consumers with the understanding that the loan will be paid back over a specified period of time. Slide 15 Glencoe Managing Life Skills Chapter 14 Manage Your Finances Chapter 14 Manage Your Finances 15 Understand Credit Types of credit include credit cards, sales credit, or cash loans. Credit allows you to purchase expensive items and pay for them over time. Slide 16 Glencoe Managing Life Skills Chapter 14 Manage Your Finances Chapter 14 Manage Your Finances 16 Understand Credit The biggest disadvantage of credit is its potential cost. Become creditworthy by establishing a credit history of paying debts in full and on time. Typical questions for applying for credit include your employment, housing, and financial history. Slide 17 Glencoe Managing Life Skills Chapter 14 Manage Your Finances Chapter 14 Manage Your Finances 17 Choosing a Credit Card Understand the basic features of the various credit cards before choosing one. Compare fees and terms of credit cards, including the annual percentage rate, the credit limit, fees, grace period, and special features. annual percentage rate (APR) The annual rate of interest that a company charges you for using credit. Slide 18 Glencoe Managing Life Skills Chapter 14 Manage Your Finances Chapter 14 Manage Your Finances 18 Use Credit Responsibly Set and follow rules about using credit. Be realistic about your spending. Save receipts to check on spending each month. Warning signs include worry about debt, spending more than you earn, maxing out your card limits, and using one card to pay another. Slide 19 Glencoe Managing Life Skills Chapter 14 Manage Your Finances Chapter 14 Manage Your Finances 19 Chapter Summary Section 14.1 Your financial fitness is determined by your ability to understand and manage your paycheck, bank accounts, income, and expenses. Your income is affected by how you are paid and by the deductions that are taken out of your paycheck. Everyday Financial Management Slide 20 Glencoe Managing Life Skills Chapter 14 Manage Your Finances Chapter 14 Manage Your Finances 20 Chapter Summary Section 14.1 Managing your income is easier with bank accounts. Insurance is a way to protect your income and possessions. Everyday Financial Management Slide 21 Glencoe Managing Life Skills Chapter 14 Manage Your Finances Chapter 14 Manage Your Finances 21 Chapter Summary Section 14.2 Banks and other organizations often extend credit to their customers. There are both advantages and disadvantages to using credit. Use Credit Wisely Slide 22 Glencoe Managing Life Skills Chapter 14 Manage Your Finances Chapter 14 Manage Your Finances 22 Chapter Summary Section 14.2 It is important to choose the right card for your needs and to pay close attention to the terms and fees included in the agreement. Credit should be used responsibly to avoid debt, high fees, bad credit, and other financial problems. Use Credit Wisely Slide 23 Glencoe Managing Life Skills Chapter 14 Manage Your Finances Chapter 14 Manage Your Finances 23 Review Start Do you remember the vocabulary terms from this chapter? Use the following slides to check your knowledge of the definitions. The slides in this section include both English and Spanish terms and definitions. Slide 24 Glencoe Managing Life Skills Chapter 14 Manage Your Finances Chapter 14 Manage Your Finances 24 gross pay ingresos brutos The total amount you earn. El total de los ingresos que recibes. Show Definition Slide 25 Glencoe Managing Life Skills Chapter 14 Manage Your Finances Chapter 14 Manage Your Finances 25 net pay pago neto The amount of pay you receive after deductions. El salario que recibes despus de las deducciones. Show Definition Slide 26 Glencoe Managing Life Skills Chapter 14 Manage Your Finances Chapter 14 Manage Your Finances 26 interest inters A fee the bank pays you for the opportunity to use your money. Un monto que el banco te paga por la oportunidad de usar tu dinero. Show Definition Slide 27 Glencoe Managing Life Skills Chapter 14 Manage Your Finances Chapter 14 Manage Your Finances 27 debit card tarjeta de dbito A card that deducts the cost of a purchase from the users bank account at the time of purchase. Una tarjeta que deduce el costo de la compra de la cuenta del banco del usuario en el momento de la compra. Show Definition Slide 28 Glencoe Managing Life Skills Chapter 14 Manage Your Finances Chapter 14 Manage Your Finances 28 reconcile reconciliar Compare accounts for accuracy. Comparar cuentas para verificar la precisin. Show Definition Slide 29 Glencoe Managing Life Skills Chapter 14 Manage Your Finances Chapter 14 Manage Your Finances 29 compound interest inters compuesto Interest that is calculated on the deposits you make and on the interest you have already earned. Inters que se calcula sobre los depsitos que haces y los intereses que has ganado. Show Definition Slide 30 Glencoe Managing Life Skills Chapter 14 Manage Your Finances Chapter 14 Manage Your Finances 30 insurance seguro Financial protection in the case of loss or harm. Proteccin financiera en caso de prdida o daos. Show Definition Slide 31 Glencoe Managing Life Skills Chapter 14 Manage Your Finances Chapter 14 Manage Your Finances 31 401(k) plan 401(k) A specific type of retirement plan offered by many companies. Un tipo especfico de pensin para jubilados que varias compaas ofrecen. Show Definition Slide 32 Glencoe Managing Life Skills Chapter 14 Manage Your Finances Chapter 14 Manage Your Finances 32 invest invertir Using money to participate in a business enterprise that offers the possibility of