The New Year’s Resolution January

Learning Objectives To understand the importance of saving and the implications of not saving To be able to identify ways in which we can save money To be able to create a realistic savings plan for the future.

Saver or Spender: Which one are you? I receive £100 in cash for the holidays. Do I... a). Rush out to the January sales straight away and spend, spend, spend b). Spend some and put the rest in my savings account for a rainy day c). Put it all in my savings account, I never know when I’m going to need it 2. My New Year’s resolution is to... a). Live for the moment and worry about money when I’m older b). Try to save some money when I have it c). Save everything! I love watching my savings account grow

3. I know exactly how much money I have in my bank account... a). Bank account, what bank account? b). Hmmm within £20 c). To the penny, I know exactly what I have 4. If I know I have to save for an expensive birthday present do I... a). Ask Mum/Dad/Anyone to lend me the money, I promise to pay it back b). Use my savings, I can always save again c). Plan in advance and budget my spending, I’ll have the money in no time 5. When I have money, I usually... a). Keep it in my pocket or under the bed, I might need it tomorrow b). Stick it in my money jar, it’s safe in there c). Put it straight in my savings account, if I leave it at home I’ll be tempted to spend it

6. If I had £5,000, I would... a). Blow it all, you only live once b). Invest in the stock market and buy some shares c). Squirrel it away, I love watching money grow 7. I worry about money... a). Not at all, I just love spending b). Sometimes, when I realise I shouldn’t have bought the latest phone, trainers etc. c). Never, I know I have a savings plan and it works for me 8. If I needed money for an emergency I would... a). Borrow it, banks are always sending me information about loans b). Be fine, I’ll worry about that if it happens c). Use one of my savings accounts, no probs!

Mostly A’s – Spontaneous Spender You love to spend, spend, spend and buy whatever you want, when you want it. Be careful as you may find it difficult saving and budgeting in the future if you don’t get into the habit now. You could do with thinking about a savings plan to make sure you don’t end up in financial trouble and you should start now. Mostly B’s – Slightly Stumped You tend not to worry about money or let it influence your decisions. You generally don't plan for the future and this might be your downfall. Perhaps you lack the knowledge of how to deal with and look after your money. Now’s the time to start learning. Mostly C’s – Savvy Saver You enjoy saving your money and the security it brings. An excellent saver, well done you’ve got the skills to manage your saving and it feels good.

What do I need to save for? Celebrations Big purchases E.g. birthdays, weddings, celebrations E.g. house, car, holiday, technology Emergencies The future E.g. retirement E.g. repairs, unexpected bills

Why do I need to save? Reduces stress Gives people independence You won’t always need to overpay for things You could get the best deals You won’t need to pay for credit You can pay unexpected bills To build future wealth/retirement It feels good

Implications of NOT saving May need to borrow money which may come at a cost (e.g. interest and charges) May fall into debt which may take a long time to pay off Unexpected bills or emergencies may be difficult to pay for May not be able to retire at an age you want

How could I save? Cut spending Set a savings budget Shop around for best deals Money jar/ money box Open a savings account/Independent Savings Account (ISA) Sell unwanted items Invest

Giving savings advice In pairs, read the scenarios and suggest... How each person could save money The implications if they do not save money Where they could safely put their savings

Scenarios Olivia Olivia is 18 and plans to go to university this year. She will be living independently, away from home. She currently has a part-time job earning about £100 a week. She wants to save about £1,000 for emergency funds just in case. Xuan Xuan has completed an Apprenticeship in IT and starts his new job next month. To celebrate, he wants to go on holiday with his friends. He has a credit card and has decided to use this to pay for the trip and his spending money—he will worry about the bill when he gets back! He has some savings but if he uses these it will leave his bank account empty.

Scenarios Ahmed Ahmed has just started Sixth Form College and wants the latest designer jacket. His mum has told him that he already has a wardrobe full of jackets and that if he wants it, he must save the money himself. Sasha Sasha has a well-paid engineering job but every month she spends more than she earns. This means that she is regularly overdrawn and this is beginning to worry her. She desperately wants to clear her overdraft and live within her means.

My Savings Plan I am saving for a new pair of trainers Target amount: £70 Target date: end of March Date I plan to save (£) How will I save this? I still need to save (£) January £5 per week for 4 weeks = £20 Saving pocket money I get from Nan £50 February £30 Birthday money £20 March Chores around the house, washing car, cleaning room and taking dog for a walk £0

Today we have learned... Why it’s important to save money The possible implications of not saving money The possible ways in which we can save money How to create a savings plan