1. MoneyCounts: A Financial Literacy Series
Financial Literacy Overview (FLO)
11-A Grange Building
University Park, PA 16802
financialliteracy.psu.edu

2. Description
The Pennsylvania State University is committed to provide students with the resources needed to make informed decisions regarding their money management.
But what is Financial Literacy? What are the main principles that a student should explore? And what is the purpose of becoming financially literate?
Financial Literacy is not just about managing your money, it dives deep to help you question your attitudes and values toward money and guides you to reach a life full of financial security and freedom.

3. Learning Outcomes
Identify the core competencies for financial literacy
Explore the knowledge using the KAB concept
Knowledge, Action, Behavior
List practical strategies to becoming financially literate
Discuss financial security and freedom goals

4. Why we need financial literacy?

5. KAB Principle

6. Core Competencies

7. Core Concept #1 - Earning
Gross versus net paycheck
Benefits and taxes
Education is important
Understand your paycheck
Verify and adjust your exemptions and deductions on your W4 (withholding)
Learn about potential benefits and taxes
Invest in your future, plan for your career through education – search the market
Knowledge
Action/Behavior

8. Core Concept #2 – Saving& Investing
Saved money grows
Banking – saving and checking accounts
Long-term financial planning
Eliminate or reduce waste
Start saving early, pay yourself first
Comparison shopping for a financial institution – reconcile your accounts
Plan for retirement, child education, renting versus owning a home
Replace waste with saving
Knowledge
Action/Behavior

9. Core Concept #3 - Spending
Difference between needs and wants
Develop a quantitative awareness of your spending habits
Get the most/best value for your money
Develop a spending plan
Track spending habits
Live within your means
Understand the social and environment impact of your spending decisions
Knowledge
Action/Behavior

10. Core Concept #4 - Borrowing
Distinguish net income from loans
Cost of borrowing – Penalty, Interest, late fee, surcharge (PILS)
Amortization schedules
Credit Score - FICO (Fair Isaac &Company) Equifax, Experian, TransUnion
Credit cards
Borrow only what you need not want
Avoid high cost loans, avoid penalties, late fees, and surcharge
Minimize interest payments
Get your free annual credit report, check your financial grade, review and correct if necessary
Shop for low interest cards, use only in emergencies, avoid paying (PILs)
Knowledge
Action/Behavior

11. Core Concept #5 – Protecting
Risk management and insurance coverage
Identity theft
Fraud and scam
Shop for insurance, review and update insurance, build up an emergency fund
Watch for your social security number and card, your date of birth and your banking information
If it is too good to be true, it most certainly is
Knowledge
Action/Behavior

12. Elements of financial well-being

13. Fundamental Steps

14. Security versus Freedom

15. Strategies to pay debt

16. Rule 20/10
Rule of 20/10 –
Your total outstanding debt should not exceed 20% of your total net yearly income. 
Your monthly debt payment (not including mortgage) should not exceed 10% of your monthly net income.

17. Rule of 72
Rule of 72 –
To find out how long it takes for your invested money to double in value, Divide 72 by the expected interest rate you hope to earn. 
The result gives you the approximate number of years it will take for your investment to double. Years to double = 72 / Interest Rate

18. Budgeting

19. Increase income

20. Decrease Spending

22. Health Insurance Requirements
Penn State requires all international students to have health insurance and will be implementing a University-wide health insurance requirement for all students during the academic year.

23. https://studentaid.psu.edu/types-of-aid/scholarships
Scholarships
Scholarships are a form of gift aid that does not need to be re-paid. The Penn State scholarship awarding process is very de-centralized, with each College having its own awarding process.

24. MoneyCounts: A Financial Literacy Series
Comments and questions
11A Grange Building
University Park, PA 16802
financialliteracy.psu.edu