Presentation from the Federal Reserve Bank of Dallas. Discuses the fundamentals of personal finance, such as budgets and banking.

1. Personal Finance Fundamentals
Disclaimer: The views expressed are those of the presenters and do not necessarily
reflect those of the Federal Reserve Bank of Dallas or the Federal Reserve System.

2. 3 M’s
• Moving On and Moving Out
– Mindset
– Money
– Management

3. Would you like to be a millionaire?
• I know the secret….
– High School Graduate $1,486,000
– College Graduate $2,557,000
– Spend less than you make!
– Income is not the key…saving is.

4. Wealth
• Most of us define wealth as the dollar value of
the assets that we own. To determine our
wealth we add up all that we own and
subtract all that we owe – that equals our net
worth.
• Simply put:
– Own – Owe = Wealth

5. Budgeting
• Budgeting (controlling your spending) will
allow you to increase your wealth.
• 3 M’s of budgeting

6. Mindset (First M)
• A budget will not tell you what to do, you
choose what to do.
• Stop saying “ I can’t afford” , say “I choose to.”
• Be creative with alternatives.

7. What type of spender are you ?
• Everyone stand.
• Sit down when I call out something you can’t
give up:
– Candy
– Cookie
– Soda
– Bottled water

8. Sit down when you can’t give it up
• Starbucks
• Going out with your friends once a week
• Buying lunch vs. bringing lunch
• Seeing the latest movies
• Getting your nails done
• Getting your hair done once a week

9. Sit down when you can’t give it up.
• Cable television
• Latest video games
• Cell phone

10. Why is it hard to discipline our spending?
• Just do it! (Mentality)
• Advertising
• Keeping up appearances
• It isn’t fun!

11. Money (2nd M)
• Do the math: How much is coming in and how
much is going out.
• Don’t forget those monthly or annual
expenses – holidays, special events, prom.
• Include money for savings.
• Remember – Life happens!

12. Management (3rd M)
• Set aside time each week to go over your plan.
• Make adjustments.
• You won’t be perfect, don’t give up.
• Find a partner to work with you.
• Fail to plan, plan to fail.

13. Budgeting tips
• Pay yourself first.
• Be honest with yourself.
• Don’t give up.
• Other people don’t budget and they are fine.
Really?

14. Savings
• Difficult to do.
• Allows us to set money aside for emergencies.
• Allows you to have the freedom to make
choices.

15. Money
Credit
Cards
Credit cards represent a loan. The card (or the number)
is simply a way to access a line of credit.
On the other hand, a debit card is a way to spend
checkable deposits, just like a paper check.

16. Credit Cards
Advantages
• Pre-approved loan
• Widely accepted
• Some consumer
protection
• Can establish credit
history
Disadvantages
• Requires discipline
from borrower
• Can have high fees
and interest
• Identity theft

17. Credit Cards
• Credit card is a pre-approved loan
• You will pay interest each month if you don’t
pay it off in full
• Credit card companies are highly regulated
about marketing to those under 21
• If you spent $1500 when you were 18 on a
credit card with 18% interest rate and paid the
minimum amount it would take until you were
26 to pay off the balance.

18. Debit Cards
Advantages
• Widely accepted
• Some consumer
protection
• Ease of use
Disadvantages
• Requires
recordkeeping
• Can have fees and
penalties
• Identity theft
• May lead to higher
spending

19. Debit cards
• A debit card gives you electronic access to
your account.
• If you are overdrawn you will be charged a
fee.
• Consumers who shop with debit cards tend to
spend about 30% more than those shopping
with cash.

20. Using credit wisely
• Credit can allow an individual to have the use
of a product or service now rather than
waiting for the future. When might this be a
good decision?
– Education
– Housing
– Transportation
– Necessities

21. Identity theft
• Don’t give out information unless you
contacted them.
• Protect your information at school
• Don’t text your information to others –you
don’t know where there phone may be
• Never carry your social security card
• Order a credit report each year and check it
annualcreditreport.com

22. Your financial future
• Think about your goals and dreams
• Determine wants vs. needs
• Make a plan
• Implement your plan
• Evaluate – weekly, monthly, yearly
• Make adjustments
• Stay informed about your options
• A great financial future awaits you !

23. Questions ?