2. Reality Town Wrap-Up Get out your handbook. ®

3. When finished completing the “Reality Town Experience” pages move on to the next slide. Click for next slide Complete the summary of “My Reality Town Experience” pages 17, 18 and 19 in your student handbook Please do so in silence.

4. Rules to follow: Respect: Speak when it is your turn. Be kind and respectful of what others have to say – everyone has a right to their own thoughts and feelings. Be silent and listen when someone else is speaking. Click for next slide Let’s Discuss the Reality Town Experience

5. What things surprised you about life as an adult? How does both parents working affect the family’s money, time and resources? How did your children affect your budget? Did you have enough money to buy everything you needed? Did you have enough money to buy everything you wanted? What is the difference between wants and needs? What aspects of Reality Town did you think were not realistic? What did you like and/or dislike about Reality Town? What did you learn from the experience? Click for next slide Questions to think about:

6. Please complete one of the following : Write a “Thank You” note to our volunteers. Write a “Letter to the Editor” about your Reality Town experience. Please do your best work! Click for next slide

7. The following slides are for completing the Reality Town Financial Analysis on pages 20-21. Depending on your school’s Reality Town schedule, you may complete this portion on another day, or continue on.

8. Let’s look at your Reality Town finances. Please listen closely to the directions!!! Turn to page 20 in your student handbook. Click for next slide

9. Debt: the amount of money you owe someone. Business [A] Monthly Payment [[B] # of Payments Total Cost [A x B] Original Loan Amount Student Loan Housing Transportatio n Total Monthly Payment Total Cost Total Debt Click for next slide Debt Analysis Chart

10. Keep you finger on page 20 and turn to your Pay Stub on the 1 st page of your handbook. TM Click for next slide Student Loans find your: “Automatic Student Loan Payment” Employer subsidized Health Insurance ____ Dental Insurance

11. Business [A] Monthly Payment [[B] # of Payments Total Cost [A x B] Original Loan Amount Student Loan $47 6 $267 Housing Transportation Total Monthly Payment Total Cost Total Debt TM Click for next slide Monthly Payment Number of Payments Loan Amount If you do not have a Student/Equipment Loan write in zeros. On the debt chart on page 20 write the following loan information: Employer subsidized Health Insurance ____ Dental Insurance

12. 20 year old home in need of some fix-up. 3 bedrooms & 2 baths in an older sub- division. Small lot. 1 car garage. $149,000 (Requires minimum $2,500/month income) Keep you finger on page 20 and find your house on pages 7-8. (Students who rent an apartment may write zero in the following areas.) Click for next slide Business [A] Monthly Payment [[B] # of Payments Total Cost [A x B] Original Loan Amount Student Loan $47 6$267 Housing $840 360 $149,000 Transportation Total Monthly Payment Total Cost Total Debt Monthly Payment Number of payments Loan Amount On the debt chart on page 20 write: $840 per month C Housing

13. $394/month gas/etc $150 Total $590 Toyota Corolla, 4 door, FWD, Sedan – Desert Sand $20,876 Keep you finger on page 20 and find your car on pages 5-6. Click for next slide Business [A] Monthly Payment [[B] # of Payments Total Cost [A x B] Original Loan Amount Student Loan $47 6 $267 Housing $840 360 149,000 Transportation $3946020,876 Total Monthly Payment Total Cost Total Debt Monthly Payment Number of payments Loan Amount On the debt chart on page 20 write: new - 60 payments 2-3 years old- 48 payments 4 or older - 36 payments Transportation

14. Business [A] Monthly Payment [[B] # of Payments Total Cost [A x B] Original Loan Amount Student Loan $47 6$267. Housing $840 360 $149,000 Transportatio n $39460$20,876 1,281 170,143 To1al Monthly Payment Total Cost Total Debt Complete your Debt Chart! Click for next slide Add these columns

15. Business [A] Monthly Payment [[B] # of Payments Total Cost [A x B] Original Loan Amount Student Loan $202 24 4,207 Housing $869 360 129,000 Transportation $392 60 20,780 1,463,153,987 T1o4t1al Monthly Payment Total Cost Total Debt  Find the largest number of payments in the # of payment column. Don’t count your house.  Divide that number by 12 and that is how many years it will take you to pay off everything you owe except for your house. Divide by 12 See the next slide to convert # of payments into years! Click for next slide How long until you are out of debt?

16. 36 payments = 3 years 48 payments = 4 years 60 payments = 5 years 120 payments =10 years Click for next slide

17. Total Cost Calculations (optional) How much does credit really cost you? Multiply Click for next slide Business [A] Monthly Payment [[B] # of Payments Total Cost [A x B] Original Loan Amount Student Loan $47 6$267. Housing $869 360 129,000 Transportation $39260$23,52020,780 1,308 150,047 T1o4t1al Monthly Payment Total Cost Total Debt Monthly Payment# of PaymentsTotal Cost (392 x 60 = 23,520) X=

18. It will cost you $2,740 in interest if you take the full 5 years to pay for this car. (That is 7 Car Payments!) Business [A] Monthly Payment [[B] # of Payments Total Cost [A x B] Original Loan Amount Student Loan $47 6$267. Housing $869 360 129,000 Transportation $39260$23,52020,780 1,308 150,047 T1o4t1al Monthly Payment Total Cost Total Debt The difference between the Original Loan AmountTotal Costthe amount paid in interest (23,520 – 20,780 = 2,740) and = Click for next slide Interest – the amount you pay someone to borrow their money.

19. Figure the “Total Cost” of your: Student or Equipment Loan Car House Business [A] Monthly Payment [[B] # of Payments Total Cost [A x B] Original Loan Amount Student Loan $47 6$267. Housing $869 360 129,000 Transportatio n $39260$23,52020,780 1,308 150,047 T1o4t1al Monthly Payment Total Cost Total Debt Click for next slide Monthly Payment# of PaymentsTotal Cost X =

20. Credit Costs! Look at the following chart to see how much your house will cost you in “Interest” if you take 30 years to pay it off? Click for next slide

21. Debt Analysis Questions using your completed Debt Analysis Chart answer the questions on page 20 of your student handbook Debt Questions : 1. What is your total debt? (Total Debt) ___________ 2. How much of your monthly income is used to pay your debt? (Total Monthly Payment) 3. How many years will it take you to get out of debt - not counting your house? (largest # of payments divided by 12 = number of years) 4. How much more will you end up paying for the items you purchased on credit? (Total Cost (-) Total Debt) __________________ 5. What items would you be willing to purchase on credit and why? (A good discussion question)

22. This student needs to put $250 back into their emergency fund so that their balance is back up to $1,000 for their next emergency. If you used this account, how much money do you need to save to replace the money you have spent out of this account? Click for next slide Emergency Savings – you must go to Financial Counseling to be able to use this money $1,000 $100.00 $1,100. savings $100.00 $1,000 $250 Home Improv. - emergency $750 Emergency Savings Account Did you need to use this fund? Look at your check register.

23. Emergency Savings Accounts are a good way to plan for the unexpected. By having money set aside for the unexpected you can avoid some of the financial “pit falls” of using credit. Click for next slide

24. Emergency Savings Account Questions - Using your check register answer the following questions found on page 20 of your handbook. Emergency Savings Account Questions: 1.Did you have to use your “emergency savings account”? (if no skip to question #5) 2.How much will you need to save each of the next 3 month to replace the funds you used? (the amount you spent divided by 3) 3.Will you be able to save that much each month? 4.If you answered “no” to question 4, what can you do to build your emergency fund back to $1,000 ? (get a 2nd job, spend less on clothes/entertainment, have a garage sale) 5.Why do you think an emergency savings account is a good idea? Click for next slide

25. Balance in Checking Amount in Savings Total Turn to page 21 and complete the Financial Summary chart in the student handbook. 1 Fill in your checking account balance. (the end balance from your Check Register) 2 Fill in your savings account balanceFill in your savings account balance. Savings Balance (found on your Check Register) + Total Investments –page 19 3 Add the checking and savings balances together. Click for next slide Financial Summary

26. checking account balance Savings account balance Click here to Return to Financial Summary Chart Click here to Return to Financial Summary Chart

27. Business [A] Monthly Payment [[B] # of Payments Total Cost [A x B] Original Loan Amount Student/Equip Loan $47 6282.$267. Housing $869 360312,840 129,000 Transportation $39260$23,52020,780 1,308 150,047 T1o4t1al Monthly Payment Total Cost Total Debt total debt figure from the Debt Analysis Chart. Page 20 of your student handbook Click here to Return to Financial Summary Chart Click here to Return to Financial Summary Chart Debt Analysis Chart

28. Amount in Checking Amount in Savings Total Total Debt Turn to page 21 and complete the Financial Summary chart in the student handbook. 1 Fill in your checking account balance. (the end balance from your Check Register) 2 Fill in your savings account balanceFill in your savings account balance. (this is found on your Check Register) 3 Add the checking and savings balances together. 4 Copy the total debt figure from the Debt Analysis Chart. Click for next slide Financial Summary

29. Look at the Saving Chart at the bottom of page 21. If you were to save just $50 a month for the next 40 years - you would have over $300,000 when you retired. Now is the time to start saving. Take a minute and study the saving chart in your book. How long will it take you to become a millionaire? Savings Totals for Monthly Investments Earning a 10% Rate of Return Number of Years Investing 10 Years20Years30 Years40 Years $50$10,243$37,971$113,033$316,226 Amount of$100$20,487$75,943$226,065$632,452 Money$200$40,973$151,886$452,130$1,264,905 Invested$300$61,460$227,829$678,196$1,897.357 Monthly$400$81,947$303,772$904,261$2,529,809 $500$102,434$379,715$1,130,326$3,162,262 Click for next slide

30. Savings Analysis Questions - Using the Financial Summary and Savings charts in your student handbook, answer the following questions in your handbook on page 21. Savings Questions: 1.How much money did you save for the month? 2.Financial Advisors recommend you save/invest 5-10% of your income What is 10% of your monthly income? 3.Did you save more or less than 10% of your income? 4.You will need to invest at least $100 a month from age 30-65 to allow you to retire above the poverty line of $22,350 / year. Given your investments/savings, will you retire above or below the poverty line? 5.Could you have saved/invested more money? 6. Why do you think it is important to save/invest money every month? Click for next slide

31. checking account balance Savings account balance Click for next slide Click here to Return to Savings questions Click here to Return to Savings questions

32. Keys to Financial Success The following acronym will help us remember the key components to financial success. $ENDP Click for next slide Wisel y

33. $ SAVE! Start saving now, it will pay off BIG! The sooner you begin saving, the sooner you will become a millionaire. Even small amounts can give big rewards when given time to grow. AVE Click for next slide

34. PLAN! Budgeting is the key to SUCCESS – Budgeting is the way to make every dollar count and to insure financial stability. P LAN Click for next slide

35. E MERGENCY FUND Click for next slide EMERGENCY SAVINGS ACCOUNT! Be prepared for financial emergencies, you never know what life may bring. Financial Advisors recommend that you have at least $1,000 in an Emergency Account.

36. N NO DEBT! Debt is EXPENSIVE – plan and save for large purchases rather than relying on credit cards and paying thousands of dollars in interest. O DEBT Click for next slide

37. DO IT!! Start NOW to plan for your future. It is never too early to be financially SMART. The sooner you start, the better off you will be. O IT NOW Click for next slide D

38. Keys to Financial Success ® $ P E N D The End $ ave P lan E mergency Fund N o Debt D o It Now! Wisely ave lan mergency Fund o Debt o It Now!