PERSONAL FINANCESProject

In this project you will

Create and Manage a Personal Budget

Discuss the Pro’s and Con’s of a selected Credit Card

Research ways you can develop your Credit Fitness.

Research ways you can protect your identity

CREATING AND MANAGING A BUDGET: KNOW YOUR

HABITS

In the first slide you will discuss your buying habits by tracking

your expenses to fully understand

how you spend your money

Total Monthly Take-Home Income (minus taxes, health insurance, other payroll deductions, 401K)

$

Household Expenses

Rent or Mortgage $

Utilities (water, sewer, gas/electricity) $

Home/Cell Phone $

Groceries $

Other Household (Cable, etc.) $

Transportation Expenses

Car Loan Payment $

Gas, Tolls, Parking, Other $

Car Insurance (set aside if paid annually or semi-annually) $

Other Expenses

Pet (Food, Vet) $

Insurance/Co-pays, Prescriptions $

Fun (entertainment, dining out, move rental, etc.) $

Minus Total Expenses $

Total Monthly Surplus/Shortage $

IN THE SECOND SLIDE YOU WILL RESEARCH WAYS YOU CAN MANAGE A

BUDGET: INCOME V EXPENSES

In the next slide you will discuss ways you can save money

ITEM ANNUAL COST ALTERNATIVE ANNUAL COST

One Cup of coffee daily at a Coffee

shop ($3)

$1,095Gourmet

coffee brewed at home

$176

One CD weekly ($12.99)

$ 675 Download individual songs you like ($1)

$375

Pizza delivery once a week ($10)

$ 520 Gourmet frozen pizza at the grocery ($5)

$260

Eating lunch out 5 days a week ($5

per lunch)

$1,250 Bring your lunch to work 5 days a

week ($1.50 per lunch)

$375

Total Annual Savings of $2,354!

IN THE NEXT SLIDE YOU WILL RESEARCH THE BUYING OF A NEW

CAR VS.USED CAR New 2009 Honda Accord EX Cost: $24,000 Payment: $476 Insurance: $ 78

Monthly difference: $176Annual difference: $2,112

Used 2003 Honda Accord EX• Cost: $14,483• Payment: $305• Insurance: $ 73

Car Cost/Payment Source: www.edmunds.com Based on financing for 60 months. New car interest rate of 7.11%; Used car interest rate of 7.35%. Car Insurance Cost Source: www.geico.com Insurance rates for a 25-year-old single male with a clean driving record.

INCOME Take-home pay minus taxes,

social security, health insurance, 401K

The next slide will show a sample budget comparing

Income to expenses.

FIXED EXPENSES: 60%Rent/Mortgage, Utilities, Home/Cell phone, Commuting, Car payment, Insurance, Work-related (clothes, dry-cleaning), Student Loan Payments, Credit Card Payments

SAVINGS: 20%Money set aside for vacations, major repairs, new appliances, to pay down existing debt, emergenciesa down-payment on a car or house, charity

RETIREMENT: 10%Ideally, 10% of your gross income

JUST FOR FUN: 10%Everybody needs some fun

The next slide:

will focus on research pertaining to the pro’s

and con’s of purchasing a credit card that you will

select

ALL of the potential costs associated with

using the credit card you selected.

The next slide will discuss:

May charge late fees if you are late making a payment? Could be as much as $50!

May not have grace periods? Meaning interest starts accruing as soon as you charge.

May have low introductory interest rates that increase dramatically over time? That 2.9% could go to 22% just like that!

May charge annual fees? Could cost you $50 just to have the card!

May charge a transaction fee for cash advances and the interest starts immediately? A percentage of your cash advance amount is added to your balance.

May charge a fee for going over your limit, and for every month you remain over your limit? Another $50 added to your balance!

Examples of the fees the Credit Card company may charge.

The next slide will discuss why credit fitness is important to you!

Credit history can impact:

Purchasing a car/home

The rate you receive on a loan

Renting an apartment

Auto and life insurance

Seeking employment

FINAL SLIDE IS RESEARCHING WAYS THAT YOU CAN PROTECT

YOUR IDENTITY! Shred documents before trashing

Pre-approved credit offers, bank/credit card statements, credit card receipts

Be careful at ATMs, or when using your debit card that others do not see your PIN

Have checks delivered to your bank rather than your home

Do not put checks in the mail from your home mailbox--drop them off at a U.S. Mailbox or the U.S. Post Office

Empty your wallet of all extra credit cards and social security numbers, etc.

Never give out any of your personal information over the phone