Alabama Jump$tart April 2007 Teach Youth to Save & Invest Month

Speaker Introduction

Slide 2 - Reasons to Save Lesson Reference: Money Management, Activity 2 – Overhead 2 REASONS TO SAVE Provide for unexpected emergencies. Purchase expensive items in the future. Ensure retirement. Plan for investment opportunities. 6

PLACES TO SAVE MONEY Would you save your money in any of these places? Why? Why not? Can you think of other places to save money? Bed & Mattress Cookie Jar Pillow Wallet Money Belt Small House Safe Slide 1 - Places to Save Money Lesson Reference: Introduction to Financial Services, Activity 2 – Overhead 1 7

Slide 4 – Places to Save Lesson Reference: Money Management, Activity 2 – Handout 2 PLACES TO SAVE Savings Accounts Money Market Accounts Certificates of Deposit (CDs) Savings Bonds Insurance 8

Slide 5 - Looking at Places to Save Lesson Reference: Money Management, Activity 2 – Overhead 3 LOOKING AT PLACES TO SAVE On a scale of 1 to 5 (with 1 being low and 5 being high), rate the following places to save your money. Based on the above ratings, where would you save your money? Why? 9

Slide 2 – Returns on Savings Lesson Reference: Money Management, Activity 3 – Handout 2 IMPACT OF RETURNS ON SAVINGS This chart shows what happens at several different rates to $100 in an account when no money is withdrawn and interest is compounded yearly. 10

Slide 3 - Places to Invest Lesson Reference: Money Management, Activity 4 – Overhead 3 PLACES TO INVEST Stocks Bonds Mutual Funds Retirement Plans Real Estate Collectibles/Valuables 11

QUESTIONS TO ASK BEFORE MAKING AN INVESTMENT 1.How safe is the investment? 2.What types of returns can I expect? 3.What kind of risk is involved? 4.Can I get my money back if I need it? How long will it take and how much will it cost to get it back quickly? 5.Are my investments in a variety of places to spread my risks (diversification)? 6.Check out the person offering you an investment with the Alabama Securities Commission! Alabama law requires most securities and the people selling them to be registered. Slide 4 – Questions to Ask Lesson Reference: Money Management, Activity 4 – Handout 2 12

Slide 2 - Saving vs. Investing, Historically Lesson Reference: Money Management, Activity 4 – Overhead 2 SAVING VS. INVESTING, HISTORICALLY The S&P 500 stock index has increased almost 200 percent since On average, the stock market returns 12 percent per year, including dividends. Savings rates, by comparison, have been much lower – anywhere from 1.5% to 5%, usually depending on the length of time the savings are deposited. 13

Sources of Information Citigroup Inc. Citigroup Financial Education Curriculum

Thank you! The End