1. Activity 1………………Saving vs. Investing Activity 2……….….Saving for a Rainy Day Activity 3……………………..1 + 1 = Saving Activity 4…..Investing for the Long Term

2. Money Management - Activity 1 ACTIVITY 1 Saving vs. Investing Overview Saving vs. investing Information on a paycheck Making a financial plan Budgeting 2

3. Slide 1 - Do You Save? Do You Invest? Lesson Reference: Money Management, Activity 1 – Overhead 1 DO YOU SAVE? DO YOU INVEST? 3

4. Slide 2 - Saving vs. Investing Lesson Reference: Money Management, Activity 1 – Overhead 2 SAVING VS. INVESTING Saving Short-term. Postpones spending. Has safety precautions. Investing Long-term. Exchanges money for something with the future expectation of receiving a profit. Has risk factors. 4

5. TAKE A GOOD LOOK AT A PAYCHECK Slide 3 – Paycheck Lesson Reference: Money Management, Activity 1 – Handout 1 5

6. Slide 4 – Making a Successful Financial Plan Lesson Reference: Money Management, Activity 1 – Handout 2 MAKING A SUCCESSFUL FINANCIAL PLAN 1.Start as early as possible. 2.Set goals. 3.Include both short- and long-term strategies. 4.Support the plan with a practical, working budget. 5.Review the plan on a regular schedule. 6.Do your homework while working on your plan. 7.Put the plan in writing. 6

7. Slide 5 - Financial Plan Assistance Lesson Reference: Money Management, Activity 1 – Overhead 3 FINANCIAL PLAN ASSISTANCE Bankers Certified Financial Planners Schools and Courses Peer Groups and Investment Clubs The Media The Internet 7

8. Savings & Investments Fixed Expenses Periodic Fixed Expenses Variable Expenses Debts BUILDING MY MONTHLY BUDGET Slide 6 – Building my Monthly Budget Lesson Reference: Money Management, Activity 1 – Handout 4 8

9. Money Management - Activity 2 ACTIVITY 2 Saving for a Rainy Day Overview Reasons to save Concerns and issues with saving Where to save 9

10. Slide 1 - Saving for a Rainy Day Lesson Reference: Money Management, Activity 2 – Overhead 1 SAVING FOR A RAINY DAY 10

11. 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. 11

12. Slide 3 – Concerns and Issues When Saving Lesson Reference: Money Management, Activity 2 – Handout 1 CONCERNS AND ISSUES WHEN SAVING Safety Restrictions Liquidity Earnings Taxes 12

13. 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 13

14. 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? 14

15. Money Management - Activity 3 ACTIVITY 3 1 + 1 = Saving Overview Types of interest The impact of saving Savings regulations 15

16. Slide 1 - Types of Interest Lesson Reference: Money Management, Activity 3 – Overhead 1 TYPES OF INTEREST Which type of return on your money would you prefer? Whats the difference? 16

17. 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. 17

18. Slide 3 - Savings Regulations Lesson Reference: Money Management, Activity 3 – Overhead 2 SAVINGS REGULATIONS Federal Government Insurance Deposits are potentially insured up to $100,000. FDIC (Federal Deposit Insurance Corporation) NCUA (National Credit Union Administration) Truth in Savings Act Financial institutions must disclose the following information about their consumer savings accounts: Fees on accounts Interest rate General terms and conditions Defines the year as 365 days for purposes of determining the annual percentage rate of interest. 18

19. Money Management - Activity 4 ACTIVITY 4 Investing for the Long Term Overview The Historical Performance of the S&P 500 Reasons to Invest Investing Considerations Investment Concerns Places to Invest Online Money Management 19

20. Slide 1 - Savings vs. Investing Lesson Reference: Money Management, Activity 4 – Overhead 1 SAVING vs. INVESTING SAVING Short-term. Postpones spending. Has safety precautions. INVESTING Long-term. Exchanges money for something with the future expectation of receiving a profit. Has risk factors. 20

21. 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 1970. 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. 21

22. 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 22

23. 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)? Slide 4 – Questions to Ask Lesson Reference: Money Management, Activity 4 – Handout 2 23

24. INTERNET PRIVACY & SECURITY Avoid passwords or screen names that are easy to guess. Change passwords often. Read privacy policies. Check online accounts often. Report unfamiliar transactions. Do not open emails with unsolicited offers that sound too good to be true. Slide 5 – Internet Privacy & Security Lesson Reference: Money Management, Activity 4 – Overhead 4 24