Tee up your audience….ask the question “ What do want to get from this session? Are these Business Professionals who are worried the economy and how to strectch a dollar? Are these low income who are looking for a dollar? Determine by the crowd how to approach the subject of Financial Education and what it means to them
The first 3 slides are designed to help audience think about their money mindset by sharing some related quotes.
Poll the audience: Ask how many of you can relate to more than one of the before mentioned quotes.
Speaker Notes: This slide is meant to provide an opportunity for thought about the role money plays in our lives. One possible analogy is that of slave and master and that money should be the slave and we us the master not the other way around.
Speaker Notes: Transitional Thoughts from Previous Slides on Mindset say, “Because we all have a money mindset, here are a few subjects I (we) would like you to think about today.” “The learning objectives for the workshop today are as follows….” Speaker Notes: When introducing the subject matter to the audience also see if they have any questions or topics that they would like to be covered. Additionally, you may want to explain that the presentation is somewhat weighted towards credit and debt as these are the two areas of high concern. Be ready for likely topics such as what is the current credit crisis and how it affects them? Investing tips/techniques, etc…
Savings: Stress the importance of saving no matter what you make (10% of paycheck at least each pay period) to start. Credit & Debt: Always manage the income to debt ratio, be aware of what it is. Ways to improve your credit score Know how to find your score and read your credit report Check at least once a year for accuracy Caution in this economy of depending heavily on credit cards Watch out for “Pre Approved” credit offerings – credit cards, quick cash loans etc Budgeting: Create a budget…..and stick to it! Visual confirmation each month of your budget as a constant reminder of what your limits are A budget is fluid, but updating regularly keeps you aware of pitfalls you might make otherwise Investing: Today….the word is “Caution” – “Research” utilize a professional to look at market trends that are upcoming down the road.
Speaker Notes: This topic should be stressed. Having an emergency fund is important, especially during a recession as unemployment rises. Use current events to stress this topic.
It is important to know exactly what is appearing on your credit report . Most states now provide individuals one free credit report annually. You may also receive free copies of your credit report if you have been declined credit within the last 30 days. Obtain credit reports and review carefully. Be sure what appears on the report is attributed to your credit history. You can request erroneous information be removed. Always check your credit report prior to applying for credit to avoid surprises. Avoid applying for credit too often in a short period of time, as, multiple credit inquires may reflect negatively on your credit worthiness or credit score. Your credit report should include: Name of Creditor Type of Account Terms Amount of the original debt or credit limit Balance outstanding Whether payments were made late during the reporting period
Speaker Notes: Ask your audience to ponder these questions. You are building them up for the analogy that you will draw between credit and trustworthiness?
If the bank checking account one does not register with the audience right away, this will open up an opportunity to discuss the fact that some Americans are “un-banked,” meaning that they do not have a bank account or they are not eligible to have a bank account. This often results from unpaid NSF fees assessed by the bank, as a result of writing “bad checks,” i.e. not enough money in the
Speaker notes: For this slide it might be good to explain to the audience the different types of debt and what stages in life they will experience this debt. Also, this may be a good time to explain that debt is not something that should be avoided but instead should be understood and handled responsibly. It is through debt that many of us pay for education and home ownership.
Speaker Notes: You can ask the audience about these terms to see how familiar they are with them. Then you can offer the answers. APR – Finance Charge – Grace Period – Fees –
Speaker Notes: A credit report is a record of an individual’s personal credit history. When a person applies for a loan, the lender will order a credit report to see how well the applicant has managed credit in the past. A credit report will tell, in detail, how much the person has borrowed, from whom, and whether the bills have been paid on time. Credit bureaus get information from a variety of sources, including stores, credit card companies, banks, mortgage companies, and medical providers. It is important to know exactly what is appearing on your credit report . Most states now provide individuals one free credit report annually. You may also receive free copies of your credit report if you have been declined credit within the last 30 days. Obtain credit reports and review carefully. Be sure what appears on the report is attributed to your credit history. You can request erroneous information be removed. Always check your credit report prior to applying for credit to avoid surprises. Avoid applying for credit too often in a short period of time, as, multiple credit inquires may reflect negatively on your credit worthiness or credit score. Your credit report should include: Name of Creditor Type of Account Terms Amount of the original debt or credit limit Balance outstanding Whether payments were made late during the reporting period
Speaker Notes: You may want to mention that each year a person is allowed one free credit report from each of the reporting agencies. Additionally, if you are ever rejected because of your credit you are allowed a report from the agency that was used to deny your credit for free.
Used responsibly, credit cards can be helpful in an emergency and for establishing a credit history. Credit card companies will compete for your business by handing out T-shirts, coffee mugs, CDs and other enticements. Don’t fall for their gimmicks. Here are some tips on using credit wisely. Be aware of teaser rates. A lot of times those low interest rates are simply introductory rates that last for a few months and then jump to 20%. It’s important that you compare offers from several different issuers before selecting a card.
Speaker Notes: Discuss the difference between good and bad debt and that the difference is understanding the terms of the debt, your ability to repay, and how the debt fits into larger goals.
Know where your money is going or it’s going to go places without you Strive to become an excellent money manager Building a budget Keep it simple Income – Fixed Expenses (rent, electric) – Variable Expenses (clothing, groceries) = Net Income or (Net Loss) Track all expenses including cash Update as often as possible: weekly or daily if possible Be flexible Build in rewards to your budget Budget Pitfalls…. Trying to live up to an unrealistic budget Not being flexible Not updating your budget on a regular basis Ignoring budget items Fun, Money Lost (cash moves quickly)
3 positions to find yourself Ahead – You have more money than you spend. Money at end of month can be saved or invested Break-even – You spent everything you had –no more, no less Behind – You spent more than you had using borrowed funds
Explain that this is a elementary budget and that a budget should be tailored towards your individual needs and goals. Most important aspect of a budget is that it is followed on a regular basis.
Speaker Notes: With this slide try to press the group to see where their money goes. For young adults, a lot of money will go towards entertainment and clothing- a good question is to ask the group to see if they know how much they spent on “nights-out” with the friends last month. Emphasis should be placed on gaining an understanding of where money is going not that spending money is bad. Speaker Notes: With this slide try to press the group to see where their money goes. For young adults, a lot of money will go towards entertainment and clothing- a good question is to ask the group to see if they know how much they spent on “nights-out” with the friends last month. Emphasis should be placed on gaining an understanding of where money is going not that spending money is bad.
Indicate that this slide is for illustrative purposes only. That in today’s environment, it is virtually impossible to find savings accounts that pay at 5%. Most are at 1-2% with some longer term CDs yielding a bit more. However, we all anticipate interest rates increasing as the economy strengthens. Depending on your audience and their risk position/tolerance, you may also want to point out that this might be a good time to enter/re-enter the stock market, (with caution of course, and the assistance of a financial advisor) to “buy low, hold and sell high”, when the market bounces back.
Speaker Notes: Habits are the actions that will make or break a person financially. Emphasize discussion regarding current habits versus habits that would create financial success. Speaker Notes: This is an opportunity to recap the main points from the presentation and provide a launching bad for further action. Any key points that were expressed during the presentation should be brought up again. For instance, save 10% of income, understand debt, and develop a working budget would be several that could be used.
National Association of Black Accountants, Inc. M ney $ ense NABA - Money $ense
“ We have become ninety-nine percent money mad. The method of living at home modestly and within our income, laying a little by systematically for the proverbial rainy day which is due to come, can almost be listed among the lost arts."
Mortgage loan (Countrywide, Quicken Loans, Bank of America)
Car loan (GMAC, Chrysler Financial, Ford Motor Credit)
Major credit card (Bank of America, Capital One, US Bank)
Dept. store credit (Macy’s, The Limited, Nordstrom)
Cell phone (AT&T, Sprint, Verizon)
NABA - Money $ense Type of Credit Lender Advantages Disadvantages HOME MORTGAGE • Commercial bank • Savings and loan • Credit union • Homes often increase in value. • Interest rates for mortgages are relatively low • The interest paid is tax-deductible. • Mortgages are long-term commitments. • Obtaining a home loan involves extensive credit checks. CAR LOANS • Commercial bank • Savings and loan • Credit union • Consumer finance company • Cars can make it easier to work and earn an income. • Cars lose their value relatively quickly. The car you purchase may have little value when the last payment is made. COLLEGE LOANS
• Commercial bank
• Savings and loan
• Credit union
• A college education is a good borrow investment. necessary. • Interest rates can be relatively low. • Students sometimes borrow more than necessary. • New graduates can face difficulty in repaying large loans. PERSONAL LOANS • Commercial bank • Savings and loan • Credit union • Consumer finance company • Personal loans allow individuals to purchase today that boat or vacation they want. • Personal loans have relatively high interest rates. • Some young people may borrow more than their income allows. CREDIT CARDS • Commercial bank • Savings and loan • Department store • Oil companies • Other financial institutions, e.g., American Express • Credit cards are convenient to use and useful in an emergency. • Credit cards provide a record of charges. • Credit cards have relatively high interest rates. • Some young people may borrow more than their income allows.
Credit Cards, Credit Bureaus and Credit Reports
Make Your Money Grow Money that is invested will grow! NABA - Money $ense What if you saved $1 per day for 30 years? TIME NO INTEREST 5% DAILY COMPOUNDING Year 1 $ 365 $ 374 Year 5 $ 1,825 $ 2,073 Year 10 $ 3,650 $ 4,735 Year 30 $10,950 $25,415