1. Personal Finance: Managing Money
Econ 10/12

2. Warm Up Are these money habits sensible or unwise?
Stopping for fast food on the way home everyday
Putting spare change into a jar every night
Saving for college
Buying extravagant gifts for friends
What are some of your money habits?

3. Gotcha!
What is in the store window to get you to walk in? What techniques are used to get you into the door?
What is the first thing you see when you walk into the store? Are you ever tempted to buy it?
What do you have to walk past in order to get to the object you want to buy? Did you ever pick up anything on the way?
When standing in line at the register, have you ever picked up anything on display to buy?
When you get your item, do you receive any coupons or flyers that will encourage you to come back? Do they have expiration dates?

4. Making Goals and Priorities
We all fall for marketing tactics but by planning ahead and having a good sense of your goals and priorities you can avoid personal finance problems
Many of us have multiple financial goals (own a house, buy a car, go to college, have a family, etc.)
When you have more than one financial goal you must prioritize them and decide which is most important to you

5. Is it a Want or a Need?
Needs: things that are essential to your health and safety
Ex. Water, basic meals, place to live, transportation to work/school
Wants: things that can make life more interesting or fun but you can get by without
Ex. Music, snowboard, ice cream, air conditioning

6. SMART Goals Financial goals need to be “SMART”
Specific: What needs to be accomplished? Who/where/why?
Measurable: How will you know if you have succeeded? How much change needs to occur?
Attainable: Do I have (or can you get) the resources? Is it a reasonable stretch?
Relevant: Are you willing to commit? Will it stop you from a more important goal?
Time-Bound: When is the deadline? What can you do today?

7. Spending Plan
Establish your goals and priorities and plan in advance to:
Make progress towards your goals
Avoid “traps” and buyers remorse
Deal with unexpected costly events
Have money on hand when you need it
Put you in control of how your money is used

8. Predicting your Income
Types of income: pay, allowance, interest, monetary gifts, sales
Use what is known:
Pay or regular allowance
Be conservative:
When estimating, aim lower rather than higher

9. Predicting your Expenses
Research before you buy
Watch for different prices in the store and online
Calculate shipping and sales tax
Find out if there are any additional costs you will have if you make the purchase
Check out customer reviews
Know the return and repair policies

10. ***Ideal situation: Spend at or BELOW your means
Pay Yourself First!
Set aside money for big ticket items
Avoid borrowing, which ends up costing you more money
Save a little every money and let it build interest
***Ideal situation: Spend at or BELOW your means
Income > Expenses

11. If your Spending Plan is not Working
Compare your actual income with anticipated income
Compare your actual spending with planned spending
Make adjustments:
Increase your income
Decrease your expenses
Combo of both
When life changes (you start a family, get a different job, take time to go to school, etc.) the plan has to change as well!