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Personal Finance Introduction

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by

Erik Yost

on 12 January 2013

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Transcript of Personal Finance Introduction

Personal Finance
Mr. Yost Aim- Wrap up savings UNIT.
Discuss HW – Chapter 1, Multiple Choice 1-20
Work at a table cluster to do 21-29
I have an article of “why” Dave works…if we have time…
Late papers for RICHEST MAN?
Have great day!
Please keep reading…I have a few books for loan… Last Day of Savings Warren Buffet
The Dark Side of Dave Ramsey Warren Buffet interview Aim – Explain Savings Options
Find the article: The Frugal Teenager, Ready or Not Let’s take 7 min to read over it.
Case Studies
Videos (dark side of Dave…)
Collect Papers (Staple with sheet on it!)
Why are teens becoming more frugal (cheap)
What are the benefits of this new behavior?

Practical $ Skills – Savings Options
HW – MONEY IN REVIEW 1-20 (We will do 20-29 in class Friday) Topic – Wrap up this Savings Unit Aim- Video / DR Savings Chapter 1 Section 4
Featured Book – Who Moved My Cheese?
Read Article: Is Keeping Up With the Joneses Killing US?
Chapter 1 : Money n Review Questions 1-20
Short Answer 21-29 (Please type or write to turn in!
Richest Man in Babylon is due on Thursday! Aim: Finish Savings Section Handling $ is 80% behavior and 20% habit Budget (live on one…)
Look on your articles about Savings (last page)
Recognize your needs and your wants.
Set money aside in ENVELOPES (sinking funds)
Have an emergency fund
Eat out less, plan “stay in nights”
Say no to wasteful purchases
Use the library for books, movies
Make a SHOPPING LIST for food and for Christmas.
Expect things to cost a little more…and plan for that! Strategies to Save $ The Rule of 72 is a formula that describe how long it will take your $ to double.

Example: If you have an interest rate of 6%, then 72 divided by 6 = 12 (years).
The real goal here is to have a higher interest rate…thus the time will be less to double your $ (remember there is 4% inflation rate…so you need to have that $ work for you!) Rule of 72 The most powerful force used for building wealth is COMPOUND INTEREST.
It can be used for you…and credit cards use it against you when you don’t pay on time!

Simply put it is INTEREST on INTEREST Compound Interest Savings needs to become a PRIORITY.
According to DR 41% save regularly.
½ of American households lives on less than 46,000 a year. (that’s very low, Putnam County has an avg. household income of 75-85k)
Each paycheck, you should do three things with your $: Save, Spend and Give Savings Topic: Wealth Building
Aim – We will discuss and describe the basics of Wealth Building.
Do Now: In you packet of articles, there is a page called “How Money Works” (Practical Money Skills)
Look over COMPOUND INTEREST AND RULE OF 72
HW: Blog #1 & Richest Man in Babylon (paper due next week 9/21 Topic – Savings :3 If it is important to you, you find a way. If not you find an excuse! When thinking of savings or anything: Do Now: Find one partner to discuss your answers to “Paradox of Thrift”
In NB, what are some of the problems of the “thrifty / frugal” culture?
Sheet “Savings By Nation” answer questions
What are 3 reasons we save $?
Dave Ramsey Packet and Video about savings
You may wish to KNOW the 7 Baby Steps! I will be asking these on tests! (and the FINAL) Aim- Savings Day #2 Aim- Why is savings important and what are some of the challenges to savings?

Do now: Why is it important to “save for a rainy day?” – Please answer in your NB
Packet (Dave Ramsey chapter 1 – section 1)
Please don’t write on them!
HW: Packet “Paradox of Thrift” (questions 1-6)
Please finish “Richest Man in Babylon” – if we have time we will explain the writing assignment today (if not tomorrow)
Blog #1 (by Friday) Why is savings important? What candy are you?
Pay day
Smarties
Dum Dums
Jaw Breaker (sour candy)
Milk Dud? Aim: PRE TEST PERSONAL FINANCE.
Blogs – where to go
CANDY BAR ACTIVITY: Take one…don’t eat them!
Chapter 1 – Part 1
Packet of Articles (please look over and read)
Blog #1 – due 9/14: Why should savings be important to everyone? How does your attitude towards spending impact your financial well being? Day 4 From the reading, what were some of the reasons these athletes go broke?

How could they have prevented this squandering of money?
Should we feel bad for their financial responsibility?
Do you think the NFL, MLB, NBA should do something about this? Why do these athletes go broke? This is from a SI article (link)
“Seventy-eight percent of NFL players are under financial stress or bankrupt just two years into retirement. Within five years of retirement, 60 percent of NBA players are broke, according to Sports Illustrated.”
Classwork / Homework: Identify 5 stupid decisions that made these athletes go broke. How and Why Athletes Go Broke Thou shall spend LESS than you make (act your wage!)
Thou shall establish a 3-6 month emergency cash fund (Dave Ramsey)
Thou shall donate to a charity regularly (Dave Ramsey)
Thou shall start investing early (compound interest)
Thou shall invest regularly
Thou shall create a diversified investment portfolio.
Thou shall fund your 401 k and IRA account.
Thou shall put at least 20% down payment on any home you buy (with a 15 year FIXED APR – Dave Ramsey)
Thou shall NOT count on SOCIAL SECURITY for your retirement.
Thou shall realize it is YOUR responsibility to manage your finance
Thou shall seek financial advice from a variety of experts and become educated by READING a wide range of experts
Thou shall have a PLAN Mr. Yost’s Rules to Financial Freedom Take the Personal Finance Profile

Mr. Yost’s Financial Rules (next slide) Your Personal Finance Profile (self test) Who is Dave Ramsey?
What did you learn? Dave Ramsey’s Foundations in Personal Finance is the core of our curriculum Personal Finance Learn about $
Recognize how you behave financially impacts you, your family, community?
What else?

Or to hang out with Mr. Yost and hear his bad jokes or love for Clemson all semester (Go Tigers!) Why take this course? Aim: In you note book, please write down WHY you are taking this course and what do you hope to learn?
Group: Dave Ramsey Sheet – What did you know about DR?
Personal Finance Profile
Mr. Yost’s Financial Rules (learn them!)
HW – Read: Richest Man in Babylon, there is a hard copy or a PDF online, please return hard copy for next class.
Question on the Outline page. This is a simple writing assignment – Max 2 Pages (you will use www.turnitin.com) Aim: Introduction, course outline, procedures

WHY you are taking this course and what do you hope to learn?
Materials: Course Outline, Poem: I Do Not Chose to Be a Common Man
Mr. Yost’s testimony
Homework
Create a turnitin.com account (see packet for passwords)
Google Dave Ramsey and list / write down what you learned from your Google search (we will share on Day 2) Welcome to Personal Finance Let’s watch the last sections on Dave Ramsey…and wealth building.

Let’s look at that formula for FUTURE VALUE
FV= PV(1+r/m)mt Aim- Finish Savings I have $75,000 Reasons to tell you why this works!
Full transcript