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Workshop led by Erin Cusack & Kaycie Hebert Financial Literacy 101: Whats Next?

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Presentation on theme: "Workshop led by Erin Cusack & Kaycie Hebert Financial Literacy 101: Whats Next?"— Presentation transcript:

1 Workshop led by Erin Cusack & Kaycie Hebert Financial Literacy 101: Whats Next?

2 This workshop is designed to help you Goals and Next Steps… Stay on track Determine what type of spender you are Set goals moving forward Learn how to improve your financial health Be proactive and take control of your finances

3 "Spend less than you earn, and do it for a long time." (Ron Blue) What type of spender are you? Take the quiz to find out! (Quiz adapted from:

4 Question 1: You take out $10 at the bank machine on the way to work. How long does it last? A – as far as the news stand. Two magazines and a pack of gum. Whoops! B – until I need to buy lunch. Theres no need to spend until then. C- Cash? My bank hasnt let me have cash since 1993 and then it was in error!

5 Question 2: Its a rainy, miserable day so youre spending lunchtime at the library. Doing what? A – eBay! 12 bids in 20 minutes. Some of them nearly identical. Oh dear. B – checking out expensive cars or holidays online. Hmm, with a bit of budgeting… C – I always spend lunch in the library. Im too broke to go out.

6 Question 3: In your winning the lottery fantasy you: A – shop like a movie star, treat friends, give money to charities, spend, spend, spend! B – buy a huge house, a Ferrari, a villa abroad, retire in the sun. C – pay off all my debts and start again

7 Question 4: A relative dies leaving you just enough to clear your debts. Six months later you: A – meant to clear them but instead went shopping. No change in debts B – cleared some but spent the rest on a car, holiday or other big burnout C – cleared the lot but somehow find myself back in debt again

8 Question 5: How much of your income goes on planning for the future? A – I meant to set up a pension fund or savings account last year. No, two years ago. Five? Still time! B – I have a company pension/ savings account that I contribute to. C – Im too tied up paying for my past!

9 Results: Mostly As - The Impulse Shopper You may only take small amounts out of the bank or get small sums in cash back at the supermarket, but it leaks out of your pocket in an instant and you have little idea where it goes! If you have money in your wallet you feel almost compelled to spend it. You find it hard to pass up any shopping experience or opportunity to spend. Impulse shoppers are often frustrated creative types whose imagination fuels their sprees. You associate buying yourself little nothings with feeling good. The down side is that when you look at your bank balance or think about your spending you feel down again – and probably end up treating yourself to give yourself a boost! You need to work out other ways of using your creativity.

10 Results: Mostly Bs - The Investment Shopper You tell yourself that you are not a shopper or not a spender, so why are you still in debt? Look back over the last six months or a year... youve been spending money, but its on big things. Youve probably convinced yourself that buying a new car is an investment. Since a car is an asset, you could easily resell it. But the reality is that cars rarely hold their value. Here's the catch: if you are putting yourself uncomfortably into the red to get your latest toy then youre paying for it with more than money – youre stressing yourself out too. The only assets that are truly investments are those that accrue interest or value, like a house. Whats the answer? By saving regular amounts now youll lesson your burden – and feel better about that investment youre about to make! Shop around for a savings account with a good interest rate! This way, the money you save will accumulate interest, which can be used to make your big purchase.

11 Mostly Cs -The Habitual Debtor Youre so used to having nothing or less than nothing that you habitually default back to this, even when your debts are cleared or you find yourself (miraculously) in the black again. You actually dont feel comfortable when youre in credit. To change your mindset you need to make it a goal for yourself to achieve financial balance. Look at why you believe you dont deserve wealth and then reprogram your beliefs. This you do by exchanging negative beliefs and statements for positive, eg dont say (or think) Im in debt but Im getting out of debt. Run a mental movie of yourself living a prosperous life. You may be surprised at how just thinking differently will have you behaving differently.

12 Take advice from the experts! So how do I getter better at managing my finances?

13 Karen Gross is a professor who has taught at New York Law School and is President of Southern Vermont College. She has developed and taught a financial advocacy course to help students take control of and improve their financial health. Gross is the past president and CEO of an educational non-profit organization in New York City that designs, implements and studies programs to improve the financial literacy skills of consumers. (allbusiness.com)

14 Karen Gross Top Ten Principles to Achieving Financial Health that Should Matter to Students 1. Recognize that you have money choices, and it is never too late to begin making better money decisions. Take the time to read and learn about money, credit and debt. The more you know, the better off you are.

15 Karen Gross Top Ten Principles to Achieving Financial Health that Should Matter to Students 2. Understand your current money situation, including how much money is coming in and where that money is going, no matter how painful. Once you know the reality of your situation, you can start taking control of it.

16 Karen Gross Top Ten Principles to Achieving Financial Health that Should Matter to Students 3.Get organized about money. Create files or use other strategies so you know which bills need to be paid regularly and whether you have enough money to pay them.

17 Karen Gross Top Ten Principles to Achieving Financial Health that Should Matter to Students 4. Consider and write down your personal (and family) goals. Post your realistic goals in places where they can serve as reminders. Tackle your goals step by step, and reward yourself as you achieve them. Track your progress (even small steps) to keep you motivated.

18 Karen Gross Top Ten Principles to Achieving Financial Health that Should Matter to Students 5. Learn how interest works- to your advantage and at your expense. Try to reduce your interest rates on debt and look for high interest savings accounts that will give you the best return on investments.

19 Karen Gross Top Ten Principles to Achieving Financial Health that Should Matter to Students 6. Have a bucket for savings- even if you only toss in pennies at the end of each day. Seeing money grow helps. Savings is a first step toward successful investing.

20 Karen Gross Top Ten Principles to Achieving Financial Health that Should Matter to Students 7. Obtain and understand your credit report and credit score, and correct any errors. Doing so also helps to protect against identity theft. Order your free credit report by mail through Equifax or TransUnion.

21 Karen Gross Top Ten Principles to Achieving Financial Health that Should Matter to Students 8. Find responsible ways to borrow money and compare different product costs so you can avoid predatory lenders and high cost credit products.

22 Karen Gross Top Ten Principles to Achieving Financial Health that Should Matter to Students 9. Resist the urge to splurge by pausing before you buy. Create your own cooling off period by asking yourself about the wisdom of what you are buying. What you want today will likely still be there tomorrow.

23 Karen Gross Top Ten Principles to Achieving Financial Health that Should Matter to Students 10. Buy the insurance you need but avoid unnecessary insurance and learn about the differences. For example, you may have certain insurance coverage when you pay for air tickets or car rentals on your card, don t pay for extra insurance for the same thing!

24 Overall, keep your goals in perspective and keep working toward them!

25 Your mission, if you choose to accept it… Bonus Challenge! Make a commitment to yourself to move toward improved financial wellness: Define what financial wellness means to you (ex. reducing stress, getting in control, having a plan… ) Identify concrete actions you can take to move toward your goals


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