1. MANAGING YOUR PERSONAL FINANCES FINANCIAL PLANNING: YOUR ROADMAP TO SUCCESS MR. ELEUTERI SPRING 2015

2. STANDARD: 1.1 Students will be able to explain the importance of a financial plan and identify its main components.

3. DO NOW What goals have you set for this course or school year? Are they SMART?

4. Goals of the Day Students will understand why financial planning is important. Student will be able to distinguish between a want and a need Students will be able to describe the 5 steps of a financial plan.

5. What’s so important about Financial Planning? Financial planning is a process of setting goals developing a plan putting the plan into action, and achieving goals

6. What’s so important about Financial Planning? It’s creating a roadmap for handling everything you do with your money—spending, savings, using credit and investing. Needs: the very basic things we must have to survive. Wants: the things that make life more interesting and fun (but you could live without them if you had to).

7. PERSONALIZE Please write down one of your main goals for the next year…. How long have you been thinking about accomplishing this? Who have you discussed this goal with and what did they say?

8. DO NOW: Wants vs. Needs (See U1.1 Needs and Wants Handout): 5 things that you want 5 things that you need People define needs and wants differently depending on your values (beliefs and practices in your life) Needs: the very basic things we must have to survive. Wants: the things that make life more interesting and fun (but you could live without them if you had to).

9. The 5 Steps of Financial Planning 5 Monitor & Modify the Plan 1 Set SMART Goals 2 Analyze Information 4 Implement the Plan 3 Create A Plan

10. STEP 1: Set SMART Goals A goal is a destination (something you want or need) which you acquire by taking certain steps.

11. STEP 1: Set SMART Goals Effective goals should be in defined in a SMART way: S pecific M easurable A ttainable R ealistic T ime Bound

12. Set SMART Goals Example #1 Save $50 by the end of next month to buy a new video game. Is this short-term goal SMART: Specific Measurable Attainable Realistic Time Bound Yes or No?

13. Set SMART Goals Example #2 Save $2,000 from a summer job for the next three years for a down payment on a car. Is this long-term goal SMART: Specific Measurable Attainable Realistic Time Bound Yes or No?

14. DO NOW: SMART Goals Practice Are these Goals SMART? (see U1.3 Smart Goal Handout)

15. STEP 2: Analyze Information Where does your money go? It is important to create a Personal Spending Record to keep track of your Cash Flow (money you receive and spend).

16. STEP 2: Analyze Information Where does your money go? DO NOW (See U1.3 Handout): What do you spend your money on? Create a simple Cash Flow Record that shows the money you received and the money you spent during the last week. (Remember, you can not spend more than you receive)

17. Income +$Spending -$ Sunday Monday Tuesday Wednesday Thursday Friday Saturday Totals Difference (Income minus Spending) STEP 2: Analyze Information

18. Goals of the Day Students will understand why financial planning is important. Students will be able to describe the 5 steps of a financial plan.

19. STEP 3: Create a Plan Making decisions about how you are going to spend your money based on your values, culture, habits and opinions of your friends and parents.

20. STEP 3: Create a Plan Identify your goals Establish your criteria Examine your options Weigh the pros and cons Make your decision Evaluate result

21. STEP 3: Create a Plan Identify your goals Establish your criteria Examine your options Weigh the pros and cons Make your decision Evaluate result DO NOW: Use the DECISION MAKING STEPS to decide which movie to see this weekend with your friends!

22. What is a SMART Goal? S M A R T

23. DO NOW: What is the difference between a want and a need? Can something be a want for one person and a need for someone else? Explain your thinking.

24. Goals of the Day Students will be able to describe the 5 steps of a financial plan. Students will be able to describe the 3R’s of Money (Financial Responsibility) Students will create personal financial roadmap.

25. STEP 4: Implement the Plan Write down your goals and post them where you can see them Tell others about your goals Create a budget (highlighting income and expenses…more on this later) Spend money according to your budget Review your plan regularly

26. STEP 5: Monitor and Modify the Plan Need to monitor the plan to make sure you are staying on track Review your plan at regular intervals. Modify the plan if your goals or finances change or your resources vary

27. 3 R’S OF MONEY: Reality, Responsibility & Restraint Personal Financial Responsibility is attained when you recognize: The reality that you will have set income It is your responsibility to handle money wisely. When you show restraint or self- control to save your money for a future goal instead of spending it now.

28. DO NOW: PERSONAL FINANCIAL ROADMAP Close your eyes and think about your future. Create a roadmap (poster) that shows your life’s journey. Include all your anticipated expenditures (i.e. cars, education, children, houses, and vacations).

29. DO NOW: PERSONAL FINANCIAL ROADMAP Close your eyes and think about your future. Create a roadmap (poster) that shows your life’s journey. Include all you major anticipated expenditures (i.e. cars, education, children, houses, and vacations). DO NOW: Poster and Personal Reflection

30. What are the 5 main steps of a financial plan?