Money Management

How much are you worth? What a person owns minus what they owe Assets (things owned with value) minus liabilities ($ owed) = net worth

Wills A legal declaration saying how your property is distributed

Tax-anticipation check Bank sets up account to receive your tax refund Bank gives you check minus fees WARNING: Fees are very high!

Renting a house/apartment Advantage: Fewer responsibilities

Renting a house/apartment Disadvantage: You don’t build equity (increased value of home)

Renting Security deposit—money you pay before you move-in; you get it back when you move out, assuming you did not damage the place

Owning a house Advantage: You can deduct the interest on your mortgage (home loan)…this is huge!!! You can build equity!

Owning a house Disadvantage More responsibilities

Owning a house The higher your down payment, the lower the mortgage and mortgage payments

Retirement Social Security Each month, you get a certain amount of money based on your top 35 years of earning Normal retirement age is 67

Retirement Pensions Each month, you get a defined amount from the company you worked for (if they offer one) Tax deferred—taxes are due on funds when received

Retirement 401(k) Companies make a contribution to the plan and employees may make contributions

Retirement 401(k) Tax deferred! Reduces your taxable income now!

Retirement 401(k) If you move jobs, you can roll your 401(k) into a new one If you take the money out, you owe taxes on it

Retirement Traditional IRA (401(k)) You pay taxes when you get the money out later

Retirement Roth IRA You pay taxes when you put the money in You don’t owe any taxes later