2.  Income from work- wages (paid by hour or unit of production) or salary (paid weekly, monthly, yearly)  Income from wealth- things you own- bank accounts, property, possessions, investments, etc.  May rent property, earn interest, etc

3.  Income- the more you have, the more you are likely to save and invest  Expectations- if you feel good about the economy, you are more likely to spend more freely  Current Interest Rates- higher rates tend to promote more savings  Taxes- higher taxes on income and investment discourage people to save

4.  Ability of customers to buy goods or services before paying for them based on an agreement to pay later  When you use a credit card, you are actually borrowing money from a bank  Charge accounts, credit cards, installment plans, car loans, home mortgages, etc  Must repay the principal (original amt borrowed) and interest (amt charged for borrowing the principal )

5.  Immediate possession  Flexibility  Safety (if lost or stolen)  Emergency Funds  Adds to Character references thru credit history

6.  Overspending  Higher costs – stores have to pay credit card companies to use their services, increase prices to pay for it  Impulse Buying

7.  Character- honesty, willing to repay debts  Capacity/Capability- measure of your ability to repay debt- income, other financial obligations  Capital- what you own- money in the bank, tangible property- the more you own, the easier it is to repay debts

8.  Open a savings account- shows you are building capital  Get a phone in your name and pay the bills on time each month  Get a co-signer- someone with good credit rating that guarantees to pay off your loan if you cannot

9.  Set financial goals- determine income and expenditures, may set goals to increase income or decrease spending- be realistic  Estimate Income- list income sources- include job, gifts, interest earned, etc  Plan Expenditures- list all that you are likely to buy or pay for over the time period of your budget; list what you plan to save; rank importance of wants