Financial literacy from indiana secretary of state

388 views

Published on

Financial literacy presentation created by the Office of the Indiana Secretary of State.

Published in: Economy & Finance, Business
0 Comments
0 Likes
Statistics
Notes
  • Be the first to comment

  • Be the first to like this

No Downloads
Views
Total views
388
On SlideShare
0
From Embeds
0
Number of Embeds
2
Actions
Shares
0
Downloads
7
Comments
0
Likes
0
Embeds 0
No embeds

No notes for slide
  • Questions????
  • Financial literacy from indiana secretary of state

    1. 1. Secretary of State Connie Lawson Improving Financial Literacy
    2. 2. Did you know? • 40% of Americans say they live beyond their means • 50% say they live paycheck to paycheck • Fewer than 50% of Americans have calculated how much they need for retirement • The average American spends 20 years in retirement. Are you ready?
    3. 3. What is Financial Literacy? It is the ability to use knowledge and skills to manage financial resources effectively for a lifetime of financial well-being.
    4. 4. What knowledge and skills can help you to be financially literate? • • • • • • Budgeting Balancing a checkbook Credit Compound Interest Investing Investment Fraud
    5. 5. Budgeting • What is budgeting? – Spending less than you’re bringing in – Planning for the long and short term
    6. 6. Why can budgeting fail? •Failure to prioritize expenses •Failure to budget practically for normal outof-pocket expenses such as groceries and gas •Failure to plan for unexpected events •Spending more money than you have
    7. 7. How to budget • List Expenses – – – – – The Unexpected Annual/Semi-annual/quarterly Monthly Weekly Discretionary • Prioritize Expenses – Necessities – Essentials – Car loan/car licensing fees/fuel – Insurance fees – Unsecured debt – Discretionary expenses List total amount of each expense & date its due
    8. 8. Make your budget work for you! • Priorities first! • Evaluate discretionary expenses • Cut down on grocery or personal items • Carpool or use public transportation
    9. 9. Balancing a checkbook • Verifies your records match the bank’s; • Monitors for bank mistakes; • Prevents you from running low or out of funds; • Recognizes issues right away; and • Evaluates your expenditures.
    10. 10. How to balance your checkbook 1. Reconcile your checks/deposits. 2. Reconcile your ATM withdrawals & debit card purchases. 3. Record interest earned & bank fees. 4. List outstanding checks/deposits. 5. Record your bank’s ending balance. 6. Calculate your balance.
    11. 11. Credit • Powerful tool – Gives access to student loans, mortgages, credit cards, auto loans, etc. • Why is good credit important? – Shows trustworthiness – Saves you money/best interest rates
    12. 12. Credit • Five Cs – Character – Capacity – Capital/Collateral – Conditions – Credit History
    13. 13. Credit Card Management • Limit the number of credit cards • For debt, look into 0% transfer programs • Be aware: – – – – – Maintenance fees Service Charges Late Fees Annual Membership fees Interest • Pay at least minimum every month • Pay extra on the card with highest interest rate (if possible)
    14. 14. Monitor Your Credit • Go to www.AnnualCreditReport.com; • Call 1-877-322-8228; or • Write to: Annual Credit Report Request Service PO Box 105281 Atlanta, GA 30348-5281
    15. 15. Compound Interest Would you rather have a million dollars right now or a penny doubled every day for 30 days?
    16. 16. Answer Take the Pennies!
    17. 17. Let’s do the math Day 1 = 1 cent Day 7 = 64 cents Day 14 = $81.92 Day 21 = $10,485.76 Day 30 = $5,368,709.12
    18. 18. What is compound interest? Interest is paid on original amount of deposit plus any interest earned. (Original $ Amount + Earned Interest) x Interest Rate x Length of Time = Amount Earned
    19. 19. Compound Interest Mike Laura Age Contributions Made Early Contributions Made Late Age Contributions Made Early Contributions Made Late 22-30 (9 years) $2,000 annually $0.00 31-65 (35 years) $0.00 $2,000 annually
    20. 20. Savings Who Without compound interest With compound interest (at age 65) Mike $18,000 $579,471 Laura $70,000 $470,249
    21. 21. 302 West Washington Street, Room E – 111 Indianapolis, IN 46204 Phone: (317) 232 – 6681 Toll Free: (800) 223 – 8791 Fax: (317) 233 – 3675 www.IndianaInvestmentWatch.com Indiana Investment Watch @INInvestWatch Connie Lawson @SecretaryLawson
    22. 22. Questions?

    ×