personal finances project. in this project you will create and manage a personal budget discuss...
TRANSCRIPT
PERSONAL FINANCESProject
In this project you will
Create and Manage a Personal Budget
Discuss the Pro’s and Con’s of a selected Credit Card
Research ways you can develop your Credit Fitness.
Research ways you can protect your identity
CREATING AND MANAGING A BUDGET: KNOW YOUR
HABITS
In the first slide you will discuss your buying habits by tracking
your expenses to fully understand
how you spend your money
Total Monthly Take-Home Income (minus taxes, health insurance, other payroll deductions, 401K)
$
Household Expenses
Rent or Mortgage $
Utilities (water, sewer, gas/electricity) $
Home/Cell Phone $
Groceries $
Other Household (Cable, etc.) $
Transportation Expenses
Car Loan Payment $
Gas, Tolls, Parking, Other $
Car Insurance (set aside if paid annually or semi-annually) $
Other Expenses
Pet (Food, Vet) $
Insurance/Co-pays, Prescriptions $
Fun (entertainment, dining out, move rental, etc.) $
Minus Total Expenses $
Total Monthly Surplus/Shortage $
IN THE SECOND SLIDE YOU WILL RESEARCH WAYS YOU CAN MANAGE A
BUDGET: INCOME V EXPENSES
In the next slide you will discuss ways you can save money
ITEM ANNUAL COST ALTERNATIVE ANNUAL COST
One Cup of coffee daily at a Coffee
shop ($3)
$1,095Gourmet
coffee brewed at home
$176
One CD weekly ($12.99)
$ 675 Download individual songs you like ($1)
$375
Pizza delivery once a week ($10)
$ 520 Gourmet frozen pizza at the grocery ($5)
$260
Eating lunch out 5 days a week ($5
per lunch)
$1,250 Bring your lunch to work 5 days a
week ($1.50 per lunch)
$375
Total Annual Savings of $2,354!
IN THE NEXT SLIDE YOU WILL RESEARCH THE BUYING OF A NEW
CAR VS.USED CAR New 2009 Honda Accord EX Cost: $24,000 Payment: $476 Insurance: $ 78
Monthly difference: $176Annual difference: $2,112
Used 2003 Honda Accord EX• Cost: $14,483• Payment: $305• Insurance: $ 73
Car Cost/Payment Source: www.edmunds.com Based on financing for 60 months. New car interest rate of 7.11%; Used car interest rate of 7.35%. Car Insurance Cost Source: www.geico.com Insurance rates for a 25-year-old single male with a clean driving record.
INCOME Take-home pay minus taxes,
social security, health insurance, 401K
The next slide will show a sample budget comparing
Income to expenses.
FIXED EXPENSES: 60%Rent/Mortgage, Utilities, Home/Cell phone, Commuting, Car payment, Insurance, Work-related (clothes, dry-cleaning), Student Loan Payments, Credit Card Payments
SAVINGS: 20%Money set aside for vacations, major repairs, new appliances, to pay down existing debt, emergenciesa down-payment on a car or house, charity
RETIREMENT: 10%Ideally, 10% of your gross income
JUST FOR FUN: 10%Everybody needs some fun
The next slide:
will focus on research pertaining to the pro’s
and con’s of purchasing a credit card that you will
select
ALL of the potential costs associated with
using the credit card you selected.
The next slide will discuss:
May charge late fees if you are late making a payment? Could be as much as $50!
May not have grace periods? Meaning interest starts accruing as soon as you charge.
May have low introductory interest rates that increase dramatically over time? That 2.9% could go to 22% just like that!
May charge annual fees? Could cost you $50 just to have the card!
May charge a transaction fee for cash advances and the interest starts immediately? A percentage of your cash advance amount is added to your balance.
May charge a fee for going over your limit, and for every month you remain over your limit? Another $50 added to your balance!
Examples of the fees the Credit Card company may charge.
The next slide will discuss why credit fitness is important to you!
Credit history can impact:
Purchasing a car/home
The rate you receive on a loan
Renting an apartment
Auto and life insurance
Seeking employment
FINAL SLIDE IS RESEARCHING WAYS THAT YOU CAN PROTECT
YOUR IDENTITY! Shred documents before trashing
Pre-approved credit offers, bank/credit card statements, credit card receipts
Be careful at ATMs, or when using your debit card that others do not see your PIN
Have checks delivered to your bank rather than your home
Do not put checks in the mail from your home mailbox--drop them off at a U.S. Mailbox or the U.S. Post Office
Empty your wallet of all extra credit cards and social security numbers, etc.
Never give out any of your personal information over the phone