2. Contents Click the link below to go directly to the slides for that chapter. Chapter 1 ■ Your Personal Strengths Chapter 2 ■ The Roles You Play Chapter 3 ■ Why We Work Chapter 4 ■ Exploring the Career Clusters Chapter 5 ■ Think Like an Entrepreneur Chapter 6 ■ Skills for Success Chapter 7 ■ Academic Planning Chapter 8 ■ Communicating with Others Chapter 9 ■ Building Relationships Chapter 10 ■ Basic Math Skills Chapter 11 ■ Technology and Your Career Chapter 12 ■ Career Planning Chapter 13 ■ Managing a Job Search Chapter 14 ■ Getting Started in Your Career Chapter 15 ■ Being Productive in Your Career Chapter 16 ■ Living a Healthy and Balanced Life Chapter 17 ■ Starting Your Own Business Chapter 18 ■ Planning Your Own Business Chapter 19 ■ Managing Your Business Chapter 20 ■ Personal Money Management Chapter 21 ■ Personal Financial Planning Chapter 22 ■ Basic Economics Chapter 23 ■ Basic Business Financial Management Chapter 24 ■ Financial Calculations for Business

3. Why We Use Money  Money is anything you exchange for goods or services.  Before money, people bartered, or traded, to get things they needed or wanted.  The face value—or denomination—of money is the number printed or stamped on it.  Face value is determined by the Federal Reserve, the government agency responsible for creating and tracking all of the money in the United States.  The real value of money is what it is worth to you.  Purchasing power is the amount of goods or services that can be purchased with a unit of currency, or type of money. 3 ChapterPersonal Money Management 20

4. Comparing Financial Needs and Wants  Your financial needs are the things you must buy in order to survive.  Your financial wants are the things you need to maintain a certain standard of living.  When you understand the difference between financial needs and wants, you can make responsible choices.  Financial needs and wants are different depending on your stage of life.  A financial decision is a decision about how to manage your money.  You can use the decision-making process for important financial decisions. 4 ChapterPersonal Money Management 20

5. Setting Financial Goals  Financial goals are the plans you have for using your money.  Setting financial goals helps you focus on how you want to use your money.  When you set financial priorities, you make decisions about which goal is most important to achieve first.  When you set financial goals, most often you think first about your spending. You will have both short-term and long-term spending goals.  It’s harder to set saving goals. Try to think about your long- term plans and objectives.  You can set open-ended and flexible savings goals rather than being specific about what you are saving for. 5 ChapterPersonal Money Management 20

6. Managing a Budget  A budget gives you a clear picture of where your money comes from and where it is going.  Every budget has two main parts: income and expenses.  The goal is to balance your budget, or make sure that your income is equal to or greater than expenses.  You can set up a budget for any length of time, however, monthly is the most common format.  Some income and expenses are fixed, which means you know what they are and have to pay them each month. Others are flexible or variable, which means they change from month to month. 6 A budget is a plan for spending and saving money. ChapterPersonal Money Management 20

7. Setting Up a Budget  To enter flexible items in a budget, estimate these items by looking at past income and expenses.  You can adjust the estimated amounts each month by entering the actual amounts you earned or spent.  There are four basic steps for setting up a budget. 1.List the categories or types of your monthly income. 2.List the categories of your regular expenses. 3.Balance your budget. At the end of the month, go back and replace the estimates with the actual amounts that you spent. 4.Do the math! Add your total income and your total expenses, then subtract your total expenses from your total income. 7 ChapterPersonal Money Management 20

8. Making Your Budget Work for You  After you set up your budget, you can see exactly how you are spending your money.  Use the Miscellaneous category in your budget to pay for unexpected expenses.  Staying on budget means using your money according to your plan to achieve your financial goals.  If you have a deficit, it means you are spending more money than you are earning every month.  To stay on budget, you’ll have to eliminate the deficit by reducing or eliminating expenses and determining if you can increase your income. 8 ChapterPersonal Money Management 20

9. Analyzing Your Paycheck  A paycheck is a written document that tells your employer’s bank how much money to give to you.  You take the paycheck to the bank to exchange for cash or to transfer funds into your account.  The pay stub provides information about your pay, including how much you have earned and how much your employer has deducted from your pay.  A deduction is an amount that your employer withholds from your earnings to pay for things such as taxes or insurance.  Even if you have a direct deposit, you will receive a pay stub that showing your earnings and deductions  A pay period is the number of days for which you are being paid. 9 ChapterPersonal Money Management 20

10. Understanding Your Paycheck  Most paychecks include:  Your employer’s name and address in the upper-left corner  A check number  The date of the check  Your name as the recipient, or payee  The amount of the check written in numbers and spelled out  The signature of a person authorized by your employer in the lower-right corner  You must endorse, or sign the back of your paycheck to before you can deposit it or cash it  A pay stub is attached to the paycheck and provides a lot of information about the money you earned. 10 ChapterPersonal Money Management 20

11. Choosing a Method of Payment  The type of money you use to make a payment depends on many things, including the type of purchase.  Cash is a good option for most purchases.  When you use cash, you know you have enough money to make the purchase.  Cash is universal. Just about everyone takes cash.  The biggest drawback to cash is that it can be lost or stolen.  When you write a check, you are permitting your bank to transfer money from your account to the payee’s account.  If you use a checking account, you must keep the account balanced. That means keeping track of the deposits and payments you have made. 11 ChapterPersonal Money Management 20

12. Debit and Credit Cards, EFTs, and Installment Plans  A debit card is more convenient than cash. You must have a bank account with enough money to cover your purchases.  Most debit cards require you to enter a personal identification number (PIN) with each use.  When you use a credit card, you are borrowing money from the business that issued the card.  With installment buying, you agree to make with a series of future payments at specified intervals for a large purchase.  You use electronic fund transfers (EFT) to transfer money from one bank account to another. You must have electronic access to your bank account and enough money in your bank account to cover your purchases. 12 ChapterPersonal Money Management 20

13. Chapter Review  Money is anything you exchange for goods or services.  Purchasing power is the amount of goods or services that can be purchased with a type of money.  Your financial needs are the things you must buy in order to survive.  Your financial wants are the things you need to maintain a certain standard of living.  Financial goals are the plans you have for using your money.  A budget is a plan for spending and saving money.  Staying on budget means using your money according to your plan to achieve your financial goals. 13 ChapterPersonal Money Management 20

14. Chapter Review (continued)  A paycheck is a written document that tells your employer’s bank how much money to give to you.  A pay stub is attached to the paycheck and provides a lot of information about the money you earned.  The type of money you use to make a payment depends on many things, including the type of purchase.  A debit card is like cash but more convenient. You must have a bank account with enough money to cover your purchases.  When you use a credit card, you are borrowing money from the business that issued the card. 14 ChapterPersonal Money Management 20