45473 financial book content 2

Citi-NIE Financial Literacy Hub for Teachers
© Citi-NIE Financial Literacy Hub for Teachers 1
TABLE OF CONTENTS
#1 Getting Started.....................................................................................2
#2 The Value Of Money ..............................................................................3
#3 Financial Decision Making Styles .............................................................4
#4 Save Before You Spend..........................................................................5
#5 Be Purposeful In Saving.........................................................................6
#6 Spend On Your Needs First.....................................................................7
#7 Rethink Your Wants...............................................................................8
#8 Budgeting ............................................................................................9
#9 Count The Cost Of A Decision ............................................................... 15
#10 Watch The Small Stuff ....................................................................... 16
#11 Decide Whether To Wait..................................................................... 17
#12 Good Deal Or Bad Deal ...................................................................... 18
#13 Think Carefully Before You Purchase.................................................... 21
#14 Keep Track Of Your Debit Card Expenses.............................................. 22
#15 Take Control Of Your Credit ................................................................ 23
#16 The Right Saving Plan........................................................................ 24
#17 The 8th
Wonder Of The World.............................................................. 26
#18 How Inflation Affects You ................................................................... 29
#19 What Is Your Net Worth ..................................................................... 30
#20 Getting Insured................................................................................. 31
#21 Exchange Rates ................................................................................ 33
#22 Make Your Pledge.............................................................................. 35
TABLE OF CONTENTS
#1 Getting Started.....................................................................................2
#2 The Value Of Money ..............................................................................3
#3 Financial Decision Making Styles .............................................................4
#4 Save Before You Spend..........................................................................5
#5 Be Purposeful In Saving.........................................................................6
#6 Spend On Your Needs First.....................................................................7
#7 Rethink Your Wants...............................................................................8
#8 Budgeting ............................................................................................9
#9 Count The Cost Of A Decision ............................................................... 15
#10 Watch The Small Stuff ....................................................................... 16
#11 Decide Whether To Wait..................................................................... 17
#12 Good Deal Or Bad Deal ...................................................................... 18
#13 Think Carefully Before You Purchase.................................................... 21
#14 Keep Track Of Your Debit Card Expenses.............................................. 22
#15 Take Control Of Your Credit ................................................................ 23
#16 The Right Saving Plan........................................................................ 24
#17 The 8th
Wonder Of The World.............................................................. 26
#18 How Inflation Affects You ................................................................... 29
#19 What Is Your Net Worth ..................................................................... 30
#20 Getting Insured................................................................................. 31
#21 Exchange Rates ................................................................................ 33
#22 Make Your Pledge.............................................................................. 35
Calculate The Cost Of A Decision

Citi-NIE Financial Literacy Hub for Teachers2
CONGRATULATIONS!
You are taking a big first step towards achieving financial success.
How can you be financially literate?
Financial literacy can be defined as having the ability to make informed
judgments and decisions about money and financial services. This includes your
ability to plan for the future, and the capability to respond to life events and
their effects on your personal finances.
So, take control of your finances! Managing your money well can help you plan
for your future.
When you manage your money well, you will be better prepared to pursue your
dreams, and hopefully have enough money to turn them into reality. You could
continue to further your studies and then start working or begin your own
business. You could also travel. No matter what you do, you will need to take
charge of your money to make your dreams come true.
Nevertheless, always remember that while money is important, money is not
everything! It is only a means; never an end in itself.
Fundamentals
Money can buy medicine but not health.
Money can buy you a house but not a home.
Money can buy you companions but not friends.
Money can buy you entertainment but not happiness
Money can buy you food but not appetite.
Money can buy you a bed but not sleep.
This workbook contains powerful ideas on financial literacy that are useful and
relevant at your current stage of life.
We welcome on this journey. All the best!
1 Getting Started
You are taking a big first step towards achieving financial success.
How can you be financially literate?
Financial literacy can be defined as having the ability to make informed
judgments and decisions about money and financial services. This includes
your ability to plan for your future, and the capability to respond to life
events and their effects on your personal finances.
So, take control of your finances! Managing your money well can help you
plan for your future.
When you manage your money well, you will be better prepared to pursue
your dreams, and hopefully have enough money to turn them into reality.
You can continue to further your studies, start working, begin your own
business, or even travel. No matter what you do, you will need to take
charge of your money to make your dreams come true.
Nevertheless, always remember that while money is important, money is
not everything! It is only a means; never an end in itself.
Fundamentals
Money can buy medicine but not health.
Money can buy you a house but not a home.
Money can buy you companions but not friends.
Money can buy you entertainment but not happiness
Money can buy you food but not appetite.
Money can buy you a bed but not sleep.
This workbook contains powerful ideas on financial literacy that are useful
and relevant at your current stage in life.
We welcome you on this journey. All the best!
Getting Started1

Citi-NIE Financial Literacy Hub for Teachers 3
Having money is important to give you freedom to achieve your life goals.
With money, you can get what you need and
want. You can also use money to help others
who are in need.
To achieve financial success, it is important to
have a right attitude towards money.
It is important to acquire knowledge and skills
to manage your money well. You need to save, manage and spend your money
wisely so that you have enough to share. Saving money is just the beginning.
You need to learn how to grow your money. Spend on things that you need; and
refrain from buying things just to show off. Remember to always take time to
share with others in need and invest in your health and relationships too.
Follow these simple principles of good financial literacy using SMS as follows:
Activity
What does money mean to you?
________________________________________________________________
________________________________________________________________
On a scale of 1 to 10 (with 10 being the strongest), give yourself a score based
on what you think your level of financial literacy is.
1 - 2 - 3 - 4 - 5 - 6 - 7 - 8 - 9 - 10
Would you like to learn more about regarding saving, managing and sharing
money?
________________________________________________________________
________________________________________________________________
2 The Value Of Money
SaveManageShare
who are in need.
Activity
________________________________________________________________
________________________________________________________________
1 - 2 - 3 - 4 - 5 - 6 - 7 - 8 - 9 - 10
money?
________________________________________________________________
________________________________________________________________
With money, you can get what you need and want.
You can also use money to help others who are
in need. However, to achieve financial success,
it is important to have the right attitude towards
money and be responsible.
to manage your money well. You need to save,
manage and spend your money wisely so that you have enough to share. Saving
money is just the beginning. You need to learn how to grow your money. Spend on
things that you need; and refrain from buying things just to show off. Remember
to always take time to share with others who are in need and invest in your health
and relationships too.
Would you like to learn more about saving, managing and sharing money?
who are in need.
Activity
________________________________________________________________
________________________________________________________________
1 - 2 - 3 - 4 - 5 - 6 - 7 - 8 - 9 - 10
money?
________________________________________________________________
________________________________________________________________
Follow these simple principles of good financial literacy using the acronym
SMS as follows:
The Value Of Money2

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Financial
Literacy
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Teachers
4

How do you usually make decisions?
Tick the description that best fits how you
usually make decisions when purchasing.
Tick
#1: I like to be decisive and make a purchase quickly.
If so, it might be good to gather more information first before you
make the purchase.
#2: I am easily attracted by promotions, and tend to make impulse
purchases at a sale.
If so, it might be good to pause and ask yourself whether you really
need that item.
#3: I like to make safe choices by sticking to familiar past decisions.
If so, it might be good to try different ways of doing things.
#4: I like to consider all factors very carefully before buying a gift for
someone?
This is good, but waiting too long or thinking through too much
might result in frustrations or missed opportunities.
Activity
How do you usually decide whether to buy something?
How do you think you can save, manage and share your money better?
3 Financial Decision Making Styles
How do you usually make decisions?
Tick the description that best fits how
you usually make decisions when
purchasing something.
#4: I like to consider all factors very carefully before buying a gift for
someone.
This is good, but waiting too long or thinking through too much
might result in frustrations or missed opportunities.
Financial Decision Making Styles3

Develop a habit of saving.
Why do you save?
We save to buy our needs and wants.
We also save, in case, there are emergency expenses.
When should you save?
Take a look at the following equations. Both are equal mathematically, but
which is better in terms of practising good financial management?
(i) Income – Expenses = Savings
If you spend first, you might not have any money left over to save!
The dangers of overspending are very high.
(ii) Income – Savings = Expenses
This is better. Set aside a compulsory savings amount before you start
spending. Only spend within your budget so that you don’t get into
debt.
Remember to pay yourself first! Save first before spending. Set aside a
predetermined sum of money every time you receive your pocket money or
any other form of income before spending. If you treat your savings amount
as a fixed expense that you must pay out first, you will be more likely to save
regularly.
Activity
Complete the table below for a list of your possible needs, wants and emergency
expenses.
Needs Wants Emergency expenses
4 Save Before You Spend
Needs Wants Emergency expenses
Develop a habit of saving.
Why do you save?
We save to buy what we need and what we want.
We also save in case there are emergency expenses.
When should you save?

Take a look at the following equations. Both are equal mathematically, but
which is better in terms of practising good financial management?
(i) Income – Expenses = Savings
If you spend first, you might not have any money left over to save!
The dangers of overspending are very high.
(ii) Income – Savings = Expenses
This is better. Set aside a compulsory savings amount before you start
spending. Only spend within your budget so that you don’t get into debt.
Remember to pay yourself first! Save first before spending. Set aside a
predetermined sum of money every time you receive your pocket money or
any other form of income before spending. If you treat your savings amount
as a fixed expense that you must pay out first, you will be more likely to save
regularly.
Save Before You Spend4

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6

How should you save?
Try this. Separate your savings money into different parts for different goals.
One part is for your long term goal like education and for emergencies.
Another part can be “fun money” for holidays, gifts, charity or for short term
goal like saving up for a laptop.
But always remember to set aside for your FUND before having your fun.
You may label 3 envelopes or coin jars for saving according to the different
goals.
Here are some other tips:
1. Set a limit for your fun money.
2. Don’t spend what you don’t have.
3. Avoid emotional spending.
4. Share the fun with others.
5. Use your money to help others.
Activity
1. How much allowance do you get per
month?
$______________________
2. How much of this money will you save
up for your “fund”, and how much will
you use for “fun”?
FUND: $__________(A)
Short term goal: $__________ (B)
FUN: $__________(C)
3. Now, consider one of the items you have listed under your ‘Wants’. How long
will it take you to save up enough money to buy that item in your wish-list?
A)Education

B)Laptop

C)Fun

5 Be Purposeful In Saving
How should you save?
Try this. Divide your savings money into different parts for different goals.
One part is for your long-term goals like education, and for emergencies.
Another part can be “fun money” for holidays, gifts, charity or for short term
goals like saving up for a laptop.
But always remember to set aside for your FUND before having your fun.
You may label 3 envelopes or coin jars for saving
according to the different goals.
Here are some other tips:
1. Set a limit for your fun money.
2. Don’t spend what you don’t have.
3. Avoid emotional spending.
4. Share the fun with others.
5. Use your money to help others.
Activity
1. How big an allowance do you get
per month?
$______________________
2. How much of this money will you
save up for your “fund”, and how
much will you use for “fun”?
FUND: $__________(A)
Short term goal: $__________ (B)
FUN: $__________(C)
3. Now, consider one of the items you
have listed under your ‘Wants’.
How long will it take you to save up enough money to buy that item
in your wish list?
Be Purposeful In Saving5

Citi-NIE Financial Literacy Hub for Teachers 7© Citi-NIE Financial Literacy Hub for Teachers 7
Needs and wants can be unlimited.
But because resources, such as money, are limited, we cannot have everything.
We must therefore choose some things over others.
Since needs are things that you cannot do without, spend on your needs first.
Needs and wants change depending on many influencing factors, such as time,
place, purpose, and people. What you need now may be different from what you
need in the future, and also different from what other people may need.
Learn to live within your means.
Remember these tips to help you:
1) Spend on your needs first, save on your wants.
2) Prioritise your needs and wants.
3) Resist peer pressure.
4) Spend for the long term.
Activity
Return to your list of needs and wants on page 5. Now rank them in order of
priority.
Needs Wants
Most important
Least important
Compare your list with a friend. How do you differ from each other?
6 Spend On Your Needs First
Needs Emergency expenses
Most important
Least important
Compare your list with a friend’s. How do you differ from each other?
Spend On Your Needs First6

Do you really want that?
Will you still want it tomorrow?
Will you still want it next week?
Sometimes purchases are bought on impulse. These
might result in regret or waste later.
Can the item be used more than once?
For example, going for an expensive dinner will only
keep you full for half a day, but you will be able to
keep and read a book you have bought for a long
time. Plus, you might even be able to recover some
of the money spent if you resell the book later. Better yet, check if you can
borrow that book from the library!
As another example, will you be wearing that expensive dress many times, or
just once for your school prom night? If you are only going to wear it once, are
you able to rent or borrow one instead?
Activity
Think of an item which you have bought but have not used it before. Discuss this
experience with your group members and point out which of these items you
could have done without.
7 Rethink Your Wants
Do you really want that?
Will you still want it tomorrow?
Will you still want it next week?
Sometimes purchases are made on impulse.
This might result in regret or waste later.
Can the item be used more than once?
For example, going for an expensive dinner
will only keep you full for half a day, but
you will be able to keep and read a book
you have bought for a long time. Plus, you might even be able to recover some
of the money spent if you resell the book later. Better yet, check if you can
borrow that book from the library!
Another example, will you be wearing this expensive dress many times, or just
once for your school prom night? If you are only going to wear it once, are you
able to rent or borrow one instead?
Rethink Your Wants7

A budget is a plan to help you track how much money you have coming in and
going out, so that you can manage your money wisely.
Income is money you receive/earn.
This can be obtained through many ways, such as your allowance, salary from a
job, interest from savings, and return on investment.
Expenses are things you spend money on.
Some expenses are fixed, such as your monthly mobile phone plan, tuition fees,
transportation, and rent. Since you must incur these costs, make sure you pay
them first. Meanwhile, some other expenses are variable, such as how much you
spend on food, entertainment, and clothes.
Why should you make budgeting a habit?
Resources are limited.
Needs and wants, on the other hand, are unlimited.
We cannot have everything we desire as a result, we must choose some things and
give up on others. Since needs are things which you cannot do without, spend first
on your needs before spending on your wants. Exercising discipline in sticking to
your budget is a good habit.
Needs are necessities that are required for living.
Examples include food, water and shelter.
Wants are things that are unnecessary but desired.
Examples include video games, designer shoes, bags and clothes.
Values guide our choices and actions. These are fundamental beliefs or practices
about what is desirable, worthwhile, and important to an individual. Your family,
friends, teachers, religion, media, law etc, can influence the values that guide
your daily actions. These actions may have an impact on your financial situation,
sometimes for many years to come. If you value financial security, you should save
part of your allowance and refrain from unnecessary spending.
Budgeting8

situation, sometimes for many years to come. If you value financial security, you
save part of your allowance and refrain from spending unnecessarily.
You may also want to think about needs, wants and values using a cupcake as
an analogy:
Therefore, a Budget can be a very powerful tool that can help you avoid buying
things that you do not need.
While it might seem a bit tedious at first, once it becomes a part of your routine,
you will be surprised at how much financial freedom you can have because of a
good budget. Take charge!
Icing and decorations represent wants - the extra items
that make our lives interesting and enjoyable.
The cake part of a cupcake represents our needs. They
must be present and addressed before considering any
icing or decorations (wants).
When making spending decisions, consider if your needs are met before
spending on any of your wants. What you determine to be a need versus a want
will depend on your personal values, just like your preference for different types
of cupcakes.
situation, sometimes for many years to come. If you value financial security, you
save part of your allowance and refrain from spending unnecessarily.
You may also want to think about needs, wants and values using a cupcake as
an analogy:
Therefore, a Budget can be a very powerful tool that can help you avoid buying
things that you do not need.
While it might seem a bit tedious at first, once it becomes a part of your routine,
you will be surprised at how much financial freedom you can have because of a
good budget. Take charge!
Icing and decorations represent wants - the extra items
that make our lives interesting and enjoyable.
The cake part of a cupcake represents our needs. They
must be present and addressed before considering any
icing or decorations (wants).
When making spending decisions, consider if your needs are met before
spending on any of your wants. What you determine to be a need versus a want
will depend on your personal values, just like your preference for different types
of cupcakes.
While it might seem a bit tedious at first, once it becomes part of your
routine, you will be surprised at how much financial freedom you can have
because of a good budget. Take charge of saving and spending!

©
Citi-‐NIE
Financial
Literacy
Hub
for
Teachers
11

Activity
Sophia’s Financial Makeover!
Profile of Sophia
Sophia’s Record of Expenses
Income Jan 20x4 Feb 20x4 Mar 20x4
Take home pay $3500 $3500 $3500
Expenses Jan 20x4 Feb 20x4 Mar 20x4
Clothes & accessories $1455 $1901 $1600
Dining out with friends &
loved ones
$499 $512 $696
Entertainment $213 $358 $345
Transport $120 $120 $120
Gym Membership $200 $200 $200
Household bills $320 $320 $320
Total
Expenses
$2807 $3411 $3281
Instructions
v Sophia has a number of financial decisions to make so that her April 20x4 Income
and Expenditure Statement will provide her with greater financial security.
v She wants to seek advice from you on how to plan the budget for April 20x4 so as to
maximise her finances. Remember to advise her to save first before allocating for
expenses for her needs and wants.
v Read each of Sophia’s decisions carefully.
Scenario 1: Financial Decision - April 20x4, week 1
A purple branded handbag that is currently in season caught Sophia’s eyes. Cost
of handbag - $3000. Sophia is envious of Lynette’s latest branded handbag. Her
current bag is old and worn out
Sophia has not shown concern for her loved ones for some time due to work. This
week she intends to shop for presents for them:
Watch for mother -$300
Golf club for father - $300
Leather purse for sister -$400
Dinner with boyfriend -$200
• 22 years old
• Teacher
• Takes home $3500 a month
• Enjoys shopping
• Enjoys spending time with her friends and loved ones
• Has a total of $3,000 savings as at January 20x4 but hopes to increase savings

©
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Financial
Literacy
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for
Teachers
11

Activity
Profile of Sophia
Take home pay $3500 $3500 $3500
loved ones
$499 $512 $696
Transport $120 $120 $120
Total
Expenses
$2807 $3411 $3281
Instructions
• 22 years old
• Teacher
• Enjoys shopping

©
Citi-‐NIE
Financial
Literacy
Hub
for
Teachers
11

Activity
Profile of Sophia
Take home pay $3500 $3500 $3500
loved ones
$499 $512 $696
Transport $120 $120 $120
Total
Expenses
$2807 $3411 $3281
Instructions
• 22 years old
• Teacher
• Enjoys shopping

Activity
Profile of Sophia
Take home pay $3500 $3500 $3500
loved ones
$499 $512 $696
Transport $120 $120 $120
Total
Expenses
$2807 $3411 $3281
Instructions
• 22 years old
• Teacher
• Enjoys shopping

Take home pay $3500 $3500 $3500
Dining out with friends
& loved ones
$499 $512 $696
Transport $120 $120 $120
Total Expenses $2807 $3411 $3281
• 22 years old
• Teacher
• Takes home $3500 salary a month
• Enjoys shopping
• Has a total of $3,000 savings as of January 20x4 but hopes to increase savings
Sophia has a number of financial decisions to make, so that her April 20x4 Income and
Expenditure Statement will provide her with a greater financial security.
She wants to seek advice from you on how to plan the budget for April 20x4 so as to
maximise her finances. Remember to advise her to save first before allocating for expenses
for her needs and wants.
Read each of Sophia’s decisions carefully.
A purple branded handbag that is currently in season caught Sophia’s eyes.
Cost of the handbag - $3000. Sophia is envious of Lynette’s latest branded
handbag. Her current bag is old and worn out
Sophia has not shown concern for her loved ones for some time
due to work. This week she intends to shop for presents for them:

Give your recommendations what Sophia can do:
Scenarios Recommendations Reasons
Scenario 1
Scenario 2
Scenario 3
Scenario 4
Sophia needs to get her laptop repaired for $300. However, she has also
promised to treat 2 friends to a buffet dinner which costs $300. She plans only
to spend on either decision this week.
Gym membership fee of $200 is due for payment at the end of the month. A
gorgeous chiffon dress ($200) that is perfect for her best friend’s party a few
months later in November caught her eyes. Sophia also remembered that she
promised to help pay $200 for her mother’s leisure trip to Hong Kong. She
does not plan to spend more than $200, since it is the end of the month and
she does not have much money left.
Scenarios Recommendations Reasons
Scenario 1
Scenario 2
Scenario 3
Scenario 4

BUDGETING WORKSHEET for Week __ : to
Activity
Plan Your Own Budget!
Income Budget Actual Variance
Total income
Amount set aside for saving
Amount available for expenses
Expenses Budget Actual Variance
Total expenses
Income Budget Actual Variance
Total income
Amount set aside for saving
Total expenses
Budgeting Worksheet for Week ___ : to
Total expenses

Citi-NIE Financial Literacy Hub for Teachers14 © Citi-NIE Financial Literacy Hub for Teachers 14
Instructions to use the budgeting template:
At the start of each week, enter in the ‘Budget’ column the amount that you
expect to receive for your income, and the amount you set aside as savings.
Then allocate carefully for your expenses.
At the end of each week, enter the actual amounts you received, saved and
spent in the ‘Actual’ column.
If an expense is paid for by your parents or someone else, record the amount
under both income and expenses. You do this because it is also money you
receive and spend; even though you do not get to see it, e.g. school fees and
clothing that your parents buy for you.
At the end of the week, subtract the ‘Actual’ column from the ‘Budget’ column to
calculate the ‘Variance’. This will be either a surplus (+) or shortage (-) in each
category.
Sticking to the Budget
The most difficult part of any budget is the ability to see it through. Now that
you have drawn up your own budget to keep your spending in check, examine it
at the end of each month to see how well you have managed to successfully
stick to it. If you have, well done! If not, re-examine your budget; is it
unrealistic or can you be more disciplined about your spending?
Take a look at your
household spending. Is your family
spending within your household
budget?
Instructions to use the budgeting template:
At the start of each week, enter in the ‘Budget’ column the amount that you
expect to receive for your income, and the amount you set aside as savings.
Then allocate carefully for your expenses.
At the end of each week, enter the actual amounts you received, saved and
spent in the ‘Actual’ column.
If an expense is paid for by your parents or someone else, record the amount
under both income and expenses. You do this because it is also money you
receive and spend; even though you do not get to see it, e.g. school fees and
clothing that your parents buy for you.
At the end of the week, subtract the ‘Actual’ column from the ‘Budget’ column to
calculate the ‘Variance’. This will be either a surplus (+) or shortage (-) in each
category.
The most difficult part of any budget is the ability to see it through. Now that
you have drawn up your own budget to keep your spending in check, examine it
at the end of each month to see how well you have managed to successfully
stick to it. If you have, well done! If not, re-examine your budget; is it
unrealistic or can you be more disciplined about your spending?
Take a look at your
household spending. Is your family
spending within your household
budget?
The most difficult part of any budget is the ability to see it through. Now that you
have drawn up your own budget to keep your spending in check, examine it at
the end of each month to see how well you have managed to successfully stick to
it. If you have, well done! If not, re-examine your budget; is it unrealistic or can
you be more disciplined in your spending?

When we decide on a choice, we have also decided not to choose the other
options. For example, when we buy something, we will not be able to use that
money for another purpose.
Regardless of what you chose to do, you could have done something else. The
opportunity cost is the next best alternative you are giving up when making a
decision.
Our choices are based on our expected
value of the decision. Since value is
subjective, everyone values things
differently and makes different decisions.
Good decision making requires comparing
the benefits and costs of different choices to
decide on the best option.
The choice is yours.
Activity
Consider the following situation. Discuss the benefits and costs of choosing one
decision over the other.
Flying on a budget airline, or taking a coach to Malaysia.
How much can you save if you take the coach instead of the plane?
Is the savings worth it for the increase in travelling time?
9 Count The Cost Of A Decision
When we make a choice, we have also decided not to choose the other options.
For example, when we buy something, we will not be able to use that money
for another purpose.
Regardless of what you chose to do, you could have done something else.
The opportunity cost is the next best alternative you are giving up when
making a decision.
Ourchoicesarebasedonourexpectedvalue
of the decision. Since value is subjective,
everyone values things differently and
makes different decisions.
Good decision making requires comparing
the benefits and costs of different choices
to decide on the best option.
The choice is yours.
Activity
Consider the following situation. Discuss the benefits and costs of choosing
one decision over the other.
Flying on a budget airline, or taking a coach to Malaysia.
How much can you save if you take the coach instead of the plane?
Is the savings worth it for the increase in travel time? What other
factors will you have to consider?
Calculate The Cost Of A Decision9

Citi-NIE Financial Literacy Hub for Teachers16© Citi-NIE Financial Literacy Hub for Teachers 16
Can you cut down on your expenses?
For example, instead of buying drinks, how about bringing along your water
bottle? How about packing lunch to school?
Do you really know where your money is going to?
Stop those spending leaks! Try keeping track of
everything you spend for a week. You might be
surprised to find out where your money is
going, and what you can reduce.
Activity
Reflect on non-essential things you frequently buy.
Do you buy a can of soft drink every day? Or do you buy Starbucks latte on a
weekly basis?
Name a non-essential item you buy: ___________________________
How much does it cost? ______________
How frequently do you buy this? (Tick an option)
I spend _________________ a year on this. I could
have bought a _____________________ with
the money.
Every Day (x365)
Every School Day (x260)
Every Few Days (x150)
Every Week (x52)
Every Month (x12)
10 Watch The Small Stuff
(big-ticket item)
surprised to find out where your money is going,
and which you can reduce.
Activity
Do you buy a can of soft drink every day? Or do you buy latte
on a weekly basis?
Activity
weekly basis?
the money.
Every Day (x365)
Every Week (x52)
Every Month (x12)
(big-ticket item)
Activity
weekly basis?
the money.
Every Day (x365)
Every Week (x52)
Every Month (x12)
(big-ticket item)
Watch The Small Stuff10

Would you prefer to pay $50 for a new arrival T-shirt, or wait until the Great
Singapore Sale for a discount?
Practising delayed gratification means waiting before getting something that you
want.
To buy, or not to buy?
Will you buy the latest mobile phone now when it is just released and the price is
high, or will you wait for a few months until the price drops? Will you wait to re-
contract your phone plan and buy the phone as part of the package at a much
lower price?
If you choose to wait for a better deal, you are practising delayed
gratification and you will be able to save money by paying less for the
same item later.
Will you use your credit card to buy the mobile phone if you do not have enough
money, or will you only buy it once you have saved enough?
If you choose to wait, you are practising delayed
gratification and you will have successfully avoided
falling into a debt trap!
Activity
List 5 things that you are thinking of buying. How can you
practise delayed gratification in the purchase of any of them?
1) _____________________________
2) _____________________________
3) _____________________________
4) _____________________________
5) _____________________________
11 Decide Whether To Wait
Would you prefer to pay $50 for a new arrival T-shirt, or wait until the Great
Singapore Sale for discount?
Practising delayed gratification means waiting before getting something that
you want.
To buy or not to buy?
Will you buy the latest mobile phone now when it has just been released and
the price is high, or will you wait for a few months until the price drops? Will
you wait to re-contract your phone plan and buy the phone as part of the
package at a much lower price?
If you choose to wait for a better deal, you are practising delayed
gratification and you will be able to save money by paying less for the
same item later.
Will you use your credit card to buy the mobile phone if you do not have
enough money, or will you only buy it once you have saved enough?
If you choose to wait, you are practising delayed
gratification and you would have successfully avoided
falling into a debt trap!
No. Items Delayed gratification strategies
1
2
3
4
5
Decide Whether To Wait11

Keep a look out for good deals and discounts, especially student discounts.
Going to the movies costs less on certain days and times.
Some food and beverage outlets provide discounted rates for students.
If you buy books and stationery, don’t forget to use a discount card.
Some banks also have special privileges for students – ask to find out!
Besides student discounts, look out for other discounts or
sales promotions.
Buying a shirt when it is on a sale is cheaper than having to
pay the full price. Buying a laptop at a computer fair might not
only be cheaper, but it may come with free gifts, too!
Shop around and compare prices and different options before
making a decision.
How do you know if it is a bad deal?
Our financial decisions often depend on many psychological
factors. Advertising is a form of marketing communication that is used to en-
courage or persuade people to continue or take action. Therefore, companies
often pay a large sum of money on advertisements to drive people’s behavior so
that they will buy their products and services.
By understanding some of the advertising techniques used by companies, you
will be able to understand what is communicated in advertisements.
Below is a list of commonly used advertising techniques.
Celebrity Endorsement: When famous people,
such as movie stars, are hired to pitch a product.
Glittering Generalities: Advertisements that over-
promise benefits after the purchase of a product or
service.
Keep a look out for good deals and discounts, especially student discounts.
Going to the movies cost less on certain days and times.
Some food and beverage outlets provide discounted rates for students.
If you buy books and stationery, don’t forget to use a discount card.
Some banks also have special privileges for students – ask to find out!
Besides student discounts, look out for other discounts or sales.
Buying a tee-shirt when it’s on a sale is cheaper than having to
pay the full price. Buying a laptop at a computer fair might not
only be cheaper, but it may come with free gifts too!
Shop around and compare prices and different options before
making a decision.
How do you know if it is a bad deal?
Our financial decisions often depend on many psychological
factors. Advertising is a form of communication for marketing
that is used to encourage or persuade people to continue or take some new
action. Therefore, companies often pay a large sum of money on advertisements
to drive people’s behavior so that they will buy their products and services.
By understanding some of the advertising techniques used by companies, you
will be able to understand what is communicated in advertisements.
Below is a list of commonly used advertising techniques.
Celebrity Endorsement: Where famous people, such
as movie stars, are hired to pitch a product.
Glittering Generalities: Advertisements that
overpromise benefits after the purchase of product or
service.
12 Good Deal or Bad Deal?
Good Deal or Bad Deal?12

Facts and Figures: Advertisements that describe facts, figures, statistics and
other data source.
Snob Appeal: Advertisements that suggest
the use of the product makes the customer
part of an elite group with a luxurious and
glamorous life style.
Bandwagon: Advertisements that make use of a group mentality to try to
convince individual consumers that a product is worth purchasing.
Beware of advertisements that are misleading and even deceptive!
Some examples include:
“Bait and Switch”: Advertisements entice consumers into the store with
bargains that are too good to be true. Once consumers are in the store, they are
told the item is unavailable and are shown a similar, but more expensive, item.
It is illegal in Singapore.
Supermarket specials: Advertisement of products that are not in stock or that
are not readily available to consumers at the
advertised price.
Out-of-context quotations: Comments by a
noted person or passages from a story taken out of
context to imply an endorsement of a product or
service.
Health fraud: Advertisements that promise
overnight medical cures and treatments.
“Get rich quick” schemes: Advertisement that offers an opportunity to earn a
lot of money in a short amount of time with very little effort.
95% of the pets had
tried it! What are you
waiting for?
Facts and Figures: Advertisements that describe facts, figures, statistics
and other data sources.
“Bait and Switch”: Advertisements entice consumers with bargains that
are too good to be true. Once consumers are in the store, they are told the
item is unavailable and are shown a similar, but more expensive, item. It is
illegal in Singapore.
Facts and Figures: Advertisements that describe facts, figures, statistics and
other data source.
Snob Appeal: Advertisements that suggest
the use of the product makes the customer
part of an elite group with a luxurious and
glamorous life style.
Bandwagon: Advertisements that make use of a group mentality to try to
convince individual consumers that a product is worth purchasing.
Beware of advertisements that are misleading and even deceptive!
Some examples include:
“Bait and Switch”: Advertisements entice consumers into the store with
bargains that are too good to be true. Once consumers are in the store, they are
told the item is unavailable and are shown a similar, but more expensive, item.
It is illegal in Singapore.
Supermarket specials: Advertisement of products that are not in stock or that
are not readily available to consumers at the
advertised price.
Out-of-context quotations: Comments by a
noted person or passages from a story taken out of
context to imply an endorsement of a product or
service.
Health fraud: Advertisements that promise
overnight medical cures and treatments.
“Get rich quick” schemes: Advertisement that offers an opportunity to earn a
lot of money in a short amount of time with very little effort.
95% of the pets had
tried it! What are you
waiting for?
Out-of-context quotations: Comments by
a well known celebrity or excerpts passages
from a story taken out of context to imply an
endorsement of a product or service.

The next time you watch an advertisement, figure out which technique the
company is using to sell their latest product. It will help you to be more informed
and less tempted by the advertisement.
It also helps if you research on a product before you buy it. Inform yourself! If
you know of someone who owns the product, ask them for an opinion or simply
look up reviews on the Internet.
Activity
Understand the fine print and implications behind a discount or sale.
What does “up to” 70% off really mean?
That second piece of clothing might be 50% off, but do you really need two?
Next time you see an advertisement, figure out the technique used to sell
their latest product. It will help you to be more informed and less tempted
by the advertisement. It also helps if you research on the product before
you buy it. Be informed! If you know of someone who owns the product,
ask them for an opinion or simply look up reviews on the Internet.

Apply the same rules in making purchases as when you
are crossing a busy road:
1) STOP. Don’t just rush into the decision.
2) WAIT. Compare prices and options. Think if you
really need it.
3) GO, only when you are certain. Delay your
purchase if you are not.
Money spending tip: Make your purchases with cash.
This can help you stick to your budget and avoid impulse purchases. Decide
ahead of time how much you want to spend, and only bring along that amount in
cash when you go shopping. Use your credit and debit cards only when you’ve
carefully planned for a purchase.
Activity
Using the traffic light metaphor, categorise your wants using the table below.
Items Action Reflection
RED LIGHT
Stop
Don’t buy it.
AMBER LIGHT
Wait
Practise delayed
gratification or
comparison
shopping
GREEN LIGHT
Go
OK, go ahead and
buy it!
13
Think Carefully Before
You Purchase
Apply the same rules in making purchases as when you
are crossing a busy road:
1) STOP. Don’t just rush into the decision.
2) WAIT. Compare prices and options. Think if you
really need it.
3) GO, only when you are certain. Delay your
purchase if you are not.
Money spending tip: Make your purchases with cash.
This can help you stick to your budget and avoid impulse purchases. Decide
ahead of time how much you want to spend, and only bring along that amount in
cash when you go shopping. Use your credit and debit cards only when you’ve
carefully planned for a purchase.
Activity
Using the traffic light metaphor, categorise your wants using the table below.
RED LIGHT
Stop
Don’t buy it.
AMBER LIGHT
Wait
Practise delayed
gratification or
comparison
shopping
GREEN LIGHT
Go
OK, go ahead and
buy it!
13
You Purchase
You Purchase
13

A debit card allows you to make purchases without cash.
Debit card quick facts:
 With a debit card, your money will
be deducted automatically from
your bank account balance. As
such, the debit card is not a loan
tool. You cannot spend money that
you do not have.
 You can apply for a debit card from the bank when you are 16 years old.
There is no minimum income requirement.
 Debit cards also come with similar benefits to the credit card such as
merchant discounts.
 You can use the debit card to make purchases over the internet.
Money spending tip:
If you have trouble controlling your spending, leave your debit card at home and
use cash when going shopping at a sale! Because you cannot see how much
money is actually being paid when using a debit card, it is very easy to just
continue using the card without actually realising that you are chalking up a
huge spending bill! If you do not keep track of your budget, you might be using
up all your intended savings money without realising it.
Activity
What are my responsibilities in using a debit card?
Image Source: Visa
14
Keep Track Of Your
Debit Card Expenses
© Citi-NIE Financial Literacy Hub for Teachers
A debit card allows you to make purchases without cash.
Debit card quick facts:
 With a debit card, your money will
be deducted automatically from
your bank account balance. As
such, the debit card is not a loan
tool. You cannot spend money that
you do not have.
 You can apply for a debit card from the bank when you are 16 years
There is no minimum income requirement.
 Debit cards also come with similar benefits to the credit card such as
merchant discounts.
 You can use the debit card to make purchases over the internet.
Money spending tip:
If you have trouble controlling your spending, leave your debit card at hom
use cash when going shopping at a sale! Because you cannot see how
money is actually being paid when using a debit card, it is very easy t
continue using the card without actually realising that you are chalking
huge spending bill! If you do not keep track of your budget, you might be
up all your intended savings money without realising it.
Activity
What are my responsibilities in using a debit card?
Image Source: Visa
14
Keep Track Of Your
Debit Card ExpensesKeep Track Of Your
Debit Card Expenses
14

Use credit cards wisely.
You can apply for a credit card when you meet the requirements, such as
minimum age and income. Before applying for and using a credit card, learn
about the fees involved. These may include annual fees, cash advance fees, late
payment fees, and interest rate charges.
Here are some tips to use a credit card to your benefit.
1. Use the credit card as a payment tool only and not as a borrowing tool.
i.e. only pay with the credit card what you know you can repay.
2. Take advantage of merchant discounts and cash back rebates. However,
always ask yourself whether you actually need the item rather than just
spending for the sake of the reward points.
3. Always pay the balance in full by the due date. If you only pay the
minimum sum, you will be charged an interest on the remaining balance.
4. Keep track of your spending. Check against your budget.
Here are some tips to avoid the debt trap:
1. Borrow only what you can repay.
2. Be aware of the hidden terms and interest
charges.
3. Don’t be late on the repayment.
Important reminders!
1. Keep your credit or debit card number and
pin a secret.
2. Report lost or stolen cards immediately.
3. Be aware of online scams. Some websites
might not be safe. Do not use a public
computer for internet shopping as there
might be tracking devices to steal your
information. Use only secured payment gateway.
Activity
The credit card interest rate is 24% per annum. There are also other potential
fees involved in using a credit card. Find out what other charges there are, and
how you can avoid them.
15 Take Control Of Your Credit
Use credit cards wisely.
You can apply for a credit card when you meet the requirements, such as a
minimum age and income. Before applying for and using a credit card, learn
about the fees involved. These may include annual fees, cash advance fees,
late payment fees, and interest rate charges.
Here are some tips to use a credit card to your benefit.
1. Use credit card as a payment tool only and not as a borrowing tool.
This means that you should only pay with the credit card if you can
afford it.
2. Take advantage of merchant discounts and cash back rebates. However,
always ask yourself whether you actually need the item rather than just
spending for the sake of the reward points.
3. Always pay the balance in full by the due date. If you only pay the
minimum sum, you will be charged an interest on the remaining balance.
4. Keep track of your spending. Check against your budget.
Here are some tips to avoid the debt trap:
1. Be aware of the hidden terms and interest charges.
2. Don’t be late on the repayment.
3. Borrow only what you can repay.
Important reminders!
1. Keep your credit or debit card number and
pin a secret.
2. Report lost or stolen cards immediately.
3. Be aware of online scams. Some websites
might not be safe. Do not use a public
computer for internet shopping as there
might be tracking devices to steal your
information. Use only secured payment gateways.
Activity
A credit card interest rate is changed at 24% per annum. There are also other
potential fees involved in using a credit card. Find out what other charges
there are, and how you can avoid them.
Take Control Of Your Credit15

How much should you save?
Try to keep at least 3-6 times the amount of your
monthly expenses as cash in a bank savings account
for emergency funds. This will of course depend on
your needs and any debt.
Where should you save or invest?
How would you choose the best option for yourself from the different saving
plans available?
Here are some questions to ask yourself:
1. How much money do you have to save or invest?
2. How much time can you commit that money into the plan without
needing to use it?
3. What is your expected return on investment?
Savings Account
A savings account is the first option for you. It will allow you to earn interest on
your savings to make your money grow. You can also withdraw your money at
any time when you need to use it.
Different banks have a different minimum age for opening an individual savings
account. If you are not yet eligible to have your own account, you can open a
joint children’s account with your parents.
Remember to check on any fees that you need to pay, such as monthly fees or
charges for ATM, bank counter service, GIRO, phone and internet banking use.
There might also be a minimum account balance that you need to maintain,
otherwise you will be charged a fee. Remember that the idea for saving money
in the bank is to make your savings grow. These bank fees might actually reduce
your money if you are not aware of them!
Fixed Deposit
Besides a savings account, you can also put your money in a bank fixed deposit
account. Depending on the amount and duration, the fixed deposit may earn you
a higher interest than savings. However, money in a fixed deposit cannot be
withdrawn before the maturity date or you will lose your interest.
The Right Saving Plan16
How much should you save?
Try to keep at least 3-6 times the amount of your
monthly expenses as cash in a bank savings account
for emergency funding. This will of course depend on
your needs and whether you have any debts.
Where should you save or invest?
How would you choose the best option for yourself from the different saving
plans available?
Here are some questions to ask yourself:
1. How much money do you have to save or invest?
2. For how much time can you commit that money into the plan without
needing to use it?
3. What is your expected return on investment?
Savings Account
A savings account is the first option for you. It will allow you to earn interest on your
savings to make your money grow. You can also withdraw your money at any time
when you need to use it.
Different banks have different minimum ages for opening an individual savings
account. If you are not yet eligible to have your own account, you can open a joint
children’s account with your parents.
Remember to check on any fees that you need to pay, such as monthly fees or
charges for ATM, bank counter service, GIRO, phone and Internet banking use. There
might also be a minimum account balance that you need to maintain, otherwise you
will be charged a fee. Remember that the idea for saving money in the bank is to
make your savings grow. Bank fees might actually reduce your money if you are not
aware of them!
Fixed Deposit
Besides a savings account, you can also put your money in a bank fixed deposit
account. Depending on the amount and duration, the fixed deposit may earn you a
higher interest than savings. However, money in a fixed deposit cannot be withdrawn
before the maturity date, or you will lose your interest.
The Right Saving Plan16

Other Investment Tools: Mutual Funds, Bonds and Stocks
Both the bank savings account and fixed
deposits have little or no risk. However, the
return on investment is low.
Other investment tools, such as mutual funds,
bonds and stocks, might earn you a higher
return. However, these also come with a higher
risk. We encourage you to find out more from a
reliable expert or professional.
Beware of get-rich-quick schemes and scams.
Diversify Your Risks
Now that you are aware of the different ways you can invest, be it in a low-risk
savings account or a high-risk investment tool, you need to realise the
importance of diversification.
Diversification is putting your money into different investments to avoid “putting
all your eggs in one basket”. This would limit your overall risk by balancing out
your riskier investments with safer ones. This way, you won’t suffer a great loss
even if one or two of your investments don’t do too well.
Other Investment Tools: Mutual Funds, Bonds and Stocks
Both a bank savings account and fixed deposit have little or no risk.
However, the return on investment is low.
Other investment tools, such as mutual funds,
bonds and stocks, might earn you a higher return.
However, these also come with a higher risk. We
encourage you to find out more from a reliable
expert or professional.
Beware of get-rich-quick schemes and scams.
Diversify Your Risks
Now that you are aware of the different ways you can invest your money,
be it in a low-risk savings account or a high-risk investment tool, you need
to realise the importance of diversification.
Diversification is putting your money into different investments to avoid
“putting all your eggs in one basket”. This would limit your overall risk
by balancing out your riskier investments with safer ones. This way, you
won’t suffer a great loss even if one or two of your investments don’t do
too well.

Simple interest is an interest that is
calculated on a principal amount.
For example, if $100 of your invested money
earns 10% per annum, you will receive $10
in interest at the end of the year.
At the end of the second year you will earn
another 10% X $100 = $10.
“Compound interest is the 8th
wonder of the world.
He who understands it, earns it.
He who doesn't, pays it.”
Simple interest is interest that is calculated
on a principal amount.
of interest at the end of the year.
At the end of the second year you will have
earn another 10% X $100 = $10.
Compound interest is interest that is calculated on both the principal and the
interest earned.
For example, if you have $100 now, at the end of the 1st
year you will earn $10
in interest if the bank pays 10% interest per annum. The $10 is added back to
the initial amount and the new total of $110 in savings will earn another 10%
compound interest on the $110 at the end of the 2nd
year. At the start of the 3rd
year, you have $121. At the end of 8 years, your money will become $214,
which is more than double of your $100.
Did you know?
The Rule of 72 can give you an approximation of how long it will take your
money to double. To apply the Rule of 72, you just need to divide the number
72 by the compound interest rate. For example, at a compound interest rate of
12% per year,
72
12%
= 𝟔𝟔 𝒚𝒚𝒚𝒚𝒚𝒚𝒚𝒚𝒚𝒚
it will take about 6 years for your money to double, if you just leave it alone and
the compound interest rate is constant throughout. This is regardless of the
initial amount of money that you save or invest.
17
The 8th
Wonder Of The
World
He who doesn't, pays it.”
Simple interest is interest that is calculated
on a principal amount.
of interest at the end of the year.
At the end of the second year you will have
earn another 10% X $100 = $10.
Compound interest is interest that is calculated on both the principal and the
interest earned.
For example, if you have $100 now, at the end of the 1st
year you will earn $10
year, you have $121. At the end of 8 years, your money will become $214,
which is more than double of your $100.
Did you know?
72 by the compound interest rate. For example, at a compound interest rate of
12% per year,
72
12%
= 𝟔𝟔 𝒚𝒚𝒚𝒚𝒚𝒚𝒚𝒚𝒚𝒚
it will take about 6 years for your money to double, if you just leave it alone and
the compound interest rate is constant throughout. This is regardless of the
initial amount of money that you save or invest.
17
The 8th
Wonder Of The
World
Compound interest is an interest that is calculated on both the principal and
the interest earned.
For example, if you have $100 now, at the end of the 1styear you will earn $10
year, you will have $121. After 8 years, your money will become $214, which
is more than a double of your $100.
Did you know?
72 by the compound interest rate. For example, at a compound interest rate
of 12% per year,
it will take about 6 years for your money to double, if you just leave it alone
and the compound interest rate is constant throughout. This is regardless of
the initial amount of money that you save or invest.
He who doesn’t, pays it.”
The 8th
Wonder Of The World17

LEVEL savings
Year 1 $2 x 180 days =
Year 2
Year 3
Year 4
Total Saved
Level
Balance before the
year’s interest
Interest Earned
Balance after the
year’s interest
Year1 $360 $360 X =$36 $360 + $36 = $396
Year 2 $396+ $360 = $756 $756 X =$75.60
Year 3
Year 4
10
100
10
100
Activity
Start a Savings Account
Suppose there are 180 days in a school year, and you decide to save $2 from
your pocket money each day, from the beginning of Sec One. You save the
same amount over the next 4 years. Let’s find out what can happen to this
amount saved.
Calculate the amount of savings you will have at the end of each year and
record your answers in the table below:
Suppose at the start of Year One, you decide to put your “fund” money into
a bank account instead of a piggy bank. Assuming you continue to deposit
$360 every year for 4 years in a bank that offers an interest rate of 10% per
annum, calculate how much money you will have at the end of each year.
The amount I will have in my bank at the end of Year 4 is $________________.
Now, what is the difference between this amount and the one you previously
calculated without any interest? Which one is better for you?

Mary George
Age started saving 15 years old 25 years old
Amount saved each year $1000 $1000
Number of years saved 10 10
Age stopped saving 25 years old 35 years old
Total amount saved $10,000 $10,000
Compound interest per annum 10% 10%
Compound interest earned
Total amount at 45 years old
Both save the same amount of
money. But Mary earns more years
of compound interest than George
because she started earlier. Who has
more money at 45 years old?
Activity
Why should you start a savings account sooner rather than later.
The secret to learning from compound interest is to start young, with as much
as possible. Calculate the interest earned by the character in the following
story.
Mary started saving when she was 15 years old.
Every year, Mary would save a thousand dollars in the bank.
Mary saved for ten years until she was 25 years old.
George only started saving when he was 25 years old.
Every year, George would save a thousand dollars in the bank.
George saved for another ten years until he was 35 years old.
Both George and Mary’s savings have been growing in the bank at a rate of
10% compound interest. After 10 years of saving, both George and Mary
leave their money in the bank until they are 45 years old, without adding in
any more money.

Inflation refers to a general rise in prices measured against a standard level of
purchasing power.
Inflation reduces the purchasing power of money. This means that with inflation,
a dollar buys less and less over time.
How will inflation affect you?
The cost of a plate of chicken rice at $3
this year will double to $6 in about 14
years if inflation of 5% per annum is
causing the weakening buying power of
money.
If your salary is not growing at the
same pace, you will have less spending
power due to the rise in prices caused
by inflation.
We need to plan for the future with inflation in mind.
If your current cost of living is $10,000 a year, at an inflation rate of 5% per
annum, in 50 years’ time when nearing your age of retirement, you will need
about $114,674 a year to maintain your same lifestyle now. That is more than
11 times what you are spending now! And the cost will continue to increase
every year thereafter due to inflation.
How much do you think you will be earning before you retire?
When do you think you should start to save for your retirement?
Activity
What is the current inflation rate in Singapore? _____________
Ask your parents. How much did a bowl of noodles cost when they were your
age? ______________
How much does it cost now? ______________
18 How Inflation Affects You
Inflation refers to a general rise in prices measured against a standard level
of purchasing power.
Inflation reduces the purchasing power of money. This means that with inflation,
a dollar buys less and less over time.
How will inflation affect you?
The cost of a plate of chicken rice at
$3 this year will double to $6 in about
14 years if inflation is 5% per annum.
If your salary is not growing at
the same pace, you will have less
spending power due to the rise in
prices caused by inflation.
We need to plan for the future with inflation in mind.
If your current cost of living is $10,000 a year, at an inflation rate of 5% per
annum, in 50 years’ time when nearing your retirement age, you will need
about $114,674 a year to maintain the same lifestyle. That is more than 11
times what you are spending now! And the cost will continue to increase every
year thereafter due to inflation.
How much do you think you will be earning before you retire?
When do you think you should start to save for your retirement?
Activity
What is the current inflation rate in Singapore? _____________
Ask your parents. How much did a bowl of noodles cost when they were your
age? ______________
How much does it cost now? ______________
How Inflation Affects You18

Assets are things you own that have positive economic value.
Examples of assets include your cash in hand, money
in the bank, investments, property, and anything you
own that has value. Some assets are intangible, such
as your time, energy and education.
Liabilities are what you owe, i.e. things that have
negative economic value.
Examples of liabilities include the balance on a credit
card or loan, money you owe others, and a housing
mortgage.
Assets and liabilities can be short-term or long-term.
Calculating your Net Worth gives a rough representation of your financial
position. You should aim to increase your assets and reduce your liabilities.
Activity
List down some of your assets and liabilities and calculate your net worth.
Assets Liabilities
Net Worth =
Net worth = Assets – Liabilities
1
9
What Is Your Net Worth?
Assets Liabilities
Net Worth =
Assets are things you own that have positive economic value.
Examples of assets include your cash in hand, money
in the bank, investments, property, and anything you
own that has value. Some assets are intangible, such
as your time, energy and education.
Liabilities are what you owe, i.e., things that have
negative economic value.
Examples of liabilities include the balance on a credit
card or loan, money you owe others, and a housing
mortgage.
Assets and liabilities can be short-term or long-term.
Calculating your net worth gives a rough representation of your financial
position. You should aim to increase your assets and reduce your
liabilities.
Activity
List down some of your assets and liabilities and calculate your net worth.
What Is Your Net Worth?19
Net worth = Assets – Liabilities

Buy the right type of insurance for the right purpose.
Insurance is the pooling of risks.
There are different types of insurance.
Life insurance. With life insurance, the
designated beneficiary will receive a sum of
money upon the death of the insured person.
Some policies also pay out for other events
such as terminal or critical illness.
Health insurance. Health insurance covers
the hospitalisation and medical expenses
when you need to be warded in a hospital.
Do note that most insurance premiums, i.e. the amount you need to pay yearly,
will increase with age. You will also have more difficulty buying insurance once
you already have a diagnosed pre-existing illness or condition.
Personal accident insurance. This is a worldwide coverage for any
accidents that might occur due to your work or travels.
Travel insurance. Travel insurance is usually purchased for a specific
period of time, and intends to cover possible inconveniences that might
occur while traveling. The coverage will vary, but will usually include
overseas medical expenses, luggage loss or delays, loss of money,
accidents, flight delays, hotel cancellations, and other unforeseen events
covered in the policy.
Other insurance. There are other insurance plans offered for specific items. For
example, you can insure valuable personal articles like jewellery, silverware and
musical instruments. You can even purchase insurance plans for your computers
and laptops. It is also compulsory for vehicle-owners in Singapore to insure their
vehicles. Some may buy an annuity plan or a universal life policy. You must
know your needs and affordability before buying insurance.
20 Getting Insured
Buy the right type of insurance for the right purpose.
Insurance is the pooling of risks.
There are different types of insurance.
Life insurance. With life insurance, the
designated beneficiary will receive a sum of
money upon the death of the insured person.
Some policies also pay out for other events,
such as terminal or critical illness.
Health insurance. Health insurance covers
the hospitalisation and medical expenses
when you need to be warded in a hospital.
Do note that most insurance premiums, i.e., the amount you need to pay
yearly, will increase with age. You will also have more difficulty buying
insurance once you already have a diagnosed pre-existing illness or condition.
Personal accident insurance. This is a worldwide coverage for any
accidents that might occur due to your work or travels.
Travel insurance. Travel insurance is usually purchased for a specific
period of time, and intends to cover possible inconveniences that might
occur while travelling. The coverage will vary, but it will usually include
overseas medical expenses, luggage loss or delays, loss of money,
accidents, flight delays, hotel cancellations, and other unforeseen events
covered in the policy.
Other insurance. There are other insurance plans offered for specific items.
For example, you can insure valuable personal articles like jewellery, silverware
and musical instruments. You can even purchase insurance plans for your
computers and laptops. It is also compulsory for vehicle-owners in Singapore to
insure their vehicles. Some may buy an annuity plan or a universal life policy.
You must know your needs and what you can afford before buying insurance.
Getting Insured20

Activity
YOU’VE GOT A NEW COMPUTER!
You need a new computer and your parents gave a total budget of $2000 to
spend on it. Below are 3 options you get to choose from.
Option A Option B Option C
AdvantagesDisadvantages
I decided to choose Option ____ because…
Option A
• Computer
$1800
• Computer Games
$100
• Tota
$1900
Option B
• Computer
$1800
• Insurance Plan 1
$100
• Total
$1900
provides insurance
against theft.
Option C
• Computer
$1800
$150
• Total
$1950
Provides insurance
against theft and
accidental damage
Option A
• Computer
$1800
• Computer Games
$100
• Total
$1900
Option B
• Computer
$1800
$100
• Total
$1900
provides insurance
against theft.
Option B
• Computer
$1800
$150
• Total
$1950
Provides insurance
against theft and
accidental damage
Activity
YOU’VE GOT A NEW COMPUTER!
You need a new computer and your parents gave a total budget of $2000 to
spend on it. Below are 3 options you get to choose from.
I decided to choose Option ____ because…
Option A
• Computer
$1800
• Computer Games
$100
• Tota
$1900
Option B
• Computer
$1800
$100
• Total
$1900
provides insurance
against theft.
Option C
• Computer
$1800
$150
• Total
$1950
Provides insurance
against theft and
accidental damage

Have you ever shopped online only to realise that the value of the goods are in
another currency? Do you know that these values can
be easily converted back to Singapore Dollars?
Understanding currency exchange may even help you
find better deals when shopping online!
Currency refers to the form of money used in a
particular country. Foreign Exchange is the trading
(buying or selling) of one currency for another.
Exchange Rates refer to the value at which one
currency can be traded for another. Exchange rates
constantly change and are affected by the demand and supply for that particular
currency. You can easily look up for the current exchange rate, at that point in
time, online.
For example, as of July 20x4 the exchange rate between Singapore and
American dollars is:
1 USD = 1.25 SGD
In other words, you can exchange every US$1 for S$1.25.
How will this help me find better online deals?
By converting currencies using the respective exchange rate, you can compare
all the prices in terms of Singapore dollars. So, before buying an item online you
can look for the same item sold in various countries. Convert the listed price in
the respective country’s currency to Singapore dollars, and compare which
pricing is relatively less expensive!
21 Exchange Rates
Have you ever shopped online only to realise that the value of the goods are in
another currency? Do you know that these values can
be easily converted back to Singapore Dollars?
Understanding currency exchange may even help you
find better deals when shopping online!
Currency refers to the form of money used in a
particular country. Foreign Exchange is the trading
(buying or selling) of one currency for another.
Exchange Rates refer to the value at which one
currency can be traded for another. Exchange rates
constantly change and are affected by the demand and supply for that
particular currency. You can easily look up for the current exchange rate online.
For example, as of July 20x4 the exchange rate between Singapore and
American dollars is:
1 USD = 1.25 SGD
In other words, you can exchange every US$1 for S$1.25.
How will this help me find better online deals?
By converting currencies using the respective exchange rate, you can compare
all the prices in Singapore dollars. So, before buying an item online you can
look for the same item sold in various countries. Convert the listed price in the
respective country’s currency to Singapore dollars and compare which pricing is
relatively less expensive!
Exchange Rates21

Activity
Go online and search for the current exchange rate for the following foreign
currencies:
One unit of foreign currency Singapore dollars
Australian Dollar
Euro
Malaysian Ringgit
Sterling Pound
US Dollar
100 units of foreign currency Singapore dollars
China Renminbi
Hong Kong Dollar
Indian Rupee
Indonesian Rupiah
Japanese Yen
Philippine Peso
Thai Baht
**Will you be looking at the buying rate or selling rate?
1. How much Malaysian Ringgit will I get in exchange for S$1?
2. How much Euro will I get in exchange for S$1?
3. How much US Dollars will I get in exchange for S$1?
5. How much Philippine Pesos will I get in exchange for S$10?
Australian Dollar
Euro
Malaysian Ringgit
Sterling Pound
US Dollar
China Renminbi
Hong Kong Dollar
Indian Rupee
Indonesian Rupiah
Japanese Yen
Philippine Peso
Thai Baht
Activity
Go online and search for the current exchange rate for the following foreign
currencies:
Australian Dollar
Euro
Malaysian Ringgit
Sterling Pound
US Dollar
China Renminbi
Hong Kong Dollar
Indian Rupee
Indonesian Rupiah
Japanese Yen
Philippine Peso
Thai Baht
**Will you be looking at the buying rate or selling rate?
1. How much Malaysian Ringgit will I get in exchange for S$1?
2. How much Euro will I get in exchange for S$1?
5. How much Philippine Pesos will I get in exchange for S$10?
1. How many Malaysian Ringgits will I get in exchange for S$1?
2. How many Euros will I get in exchange for S$1?
3. How many US Dollars will I get in exchange for S$1?
4. How many US Dollars will I get in exchange for S$120?
5. How many Philippine Pesos will I get in exchange for S$10?

What do you hope to achieve
financially in
10 weeks?
10 months?
10 years?
Try to s-t-r-e-t-c-h yourself when setting your goals.
Remember to make your goals S.M.A.R.T.
Specific – State exactly what you want to do.
Measurable – How will you know that the goal has been met?
Achievable – The goal should be within your ability to accomplish.
Relevant – The goal should be related to your overall life objectives.
Time-bound – Set milestones and deadlines to achieve your goal.
The journey of a thousand miles begin with one step.
~ Lao Tzu ~
Activity
The most difficult part about goals is usually the first part of writing it down.
Let’s set some goals now and make a pledge!
The first step is to think about your future life events. Use the table below to
help you plan. Remember it has to be S.M.A.R.T.
Timeline My life events
10-weeks
10-months
10-years
22 Make Your Pledge
Timeline My life events
10-weeks
10-months
10-years
Activity
The most difficult part about setting a goal is usually the first part of writing it
down. Let’s set some goals now and make a pledge!
The first step is to think about your future life events. Use the table below to
help you plan. Remember it has to be S.M.A.R.T.
Make Your Pledge22

Now let’s make a pledge.
I, _________________, promise to Save, Manage, and Share (SMS) as follows:
SAVE
What are my goals?
1.
Date due:
2.
Date due:
3.
Date due:
MANAGE
What are my goals?
1.
Date due:
2.
Date due:
3.
Date due:
SHARE
What are my goals?
1.
Date due:
2.
Date due:
3.
Date due:
How will I achieve
them?
1.
2.
3.
How will I achieve
them?
1.
2.
3.
How will I achieve
them?
1.
2.
3.
I pledge to work hard towards achieving the goals above.
Name:
Signature:
Date:

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