Personal Finance

 Spreading out the risk of a portfolio over many different types of investments  Mutual Funds Collect small amounts money from many investors Buy small amounts of equities from many sources  Money Market

 Balances like a teeter-totter  Depends on the goals of the saver  Time  Income  Expenses

 Measures how available the money is for the saver  Period of time it takes for saver to get the money and spend it

 Directing regular, small amounts of money toward the stock market  10 % gross income each paycheck  Buy low  Sell high

 Loaning money with a promise to pay back with interest

 Minor ownership in the company  Common Performance dividends; voting rights  Preferred Fixed dividends; no voting rights  Convertible Fixed dividend; voting rights  How to Read a Stock Table How to Read a Stock Table  Stock Market Game Stock Market Game  Sign-up Form Sign-up Form

 Markets for the sale of stock  NYSE – New York Stock Exchange  NASDAQ – National Association of Securities Dealers Automated Quotient  OTC – over the counter  NYME – New York Mercantile Exchange  CBT – Chicago Board of Trade

 Conglomerate averages  Measure the performance of the market  General overview  DJIA – Dow Jones Industrial Average  S&P – Standard and Poors  BNOX – Bloomberg Northeastern Ohio Index

 Bull Market  Steady rise of the market  Bear Market  Steady decline of the market

► Place where trades are transacted ► Card Game  Objective to corner the market  Same number of commodities as players  Wild cards ► Bull ► Bear

 Individual Retirement Arrangement  Usually tax deferred  May be matched by company  Roth is tax sheltered  401(k) – IRS code for tax purposes  403(b) – created for employees of non-profits

 Interest calculated on the initial principal and also on the accumulated interest of previous periods of a deposit or loan.  CONTRIBUTING $416/MONTH AT 8% ANNUALLY CONTRIBUTING $416/MONTH AT 8% ANNUALLY Pay in 40 YEARS = $1,472, Pay in 10 YEARS = $847, WAIT 10 YEARS = $628,672.36

 Dave Ramsey   Small, smart steps will get you to security  A place where your money is working for you  Not you working for your money  Be Radical  In decision making, not spending  Be Intentional  “On paper, on purpose”

 $1000 Emergency Fund  $0 of Personal Debt  3-6 Months of Living Expenses  10-15% in a Retirement Account  College Funding  For children  Scholarships  Work  20/20* Down Payment/Life of the Loan (House)  50/50* Living/Giving

 Work in groups to devise an investment strategy for 6 different households.  Each have unique circumstances  Each have $50,000 to use  You have 30 minutes 5 minutes per scenario Remember the Baby Steps Consider the investment strategies we just learned Liquidity, Diversification, Risk vs. Return