1. Retire a Millionaire

2. Steps 1 Manage your income 1 Manage your income 2 Manage your spending 2 Manage your spending 3 Start an emergency fund 3 Start an emergency fund 4 Pay down debt 4 Pay down debt 5 Invest 5 Invest

3. Manage your income Ensure you are paid the correct amount each month. Ensure you are paid the correct amount each month. Ensure monthly deductions are going where they are supposed to. Ensure monthly deductions are going where they are supposed to.

4. Manage your spending Budget Budget Stick to the budget Stick to the budget Avoid the “Latte Factor” Avoid the “Latte Factor”

5. The “Latte Factor” Coffee in the morning $2.00 Coffee in the morning $2.00 Soda from the vending machine $1.00 Soda from the vending machine $1.00 Chicken and Cheese Special $6.00 Chicken and Cheese Special $6.00

6. The “Latte Factor”$2.00$1.00 +$6.00 +$6.00 $9.00 a day $9.00 a day 5 days a week 5 days a week $45.00 a week $45.00 a week 45 weeks a year $2025 a year

7. Start an emergency fund Should be in “liquid” account Should be in “liquid” account Equal to 3 months pay Equal to 3 months pay Uses include unexpected car repairs, emergency leave travel Uses include unexpected car repairs, emergency leave travel

8. Pay down debt Pay off high interest accounts first Credit Cards 10% - 25% Car loans 5% - 10% Student loans 5% - 10%

9. Credit Cards Call company and ask for lower APR Call company and ask for lower APR Avoid fees from late or missed payments Avoid fees from late or missed payments

10. Your credit report www.equifax.com www.equifax.com www.equifax.com About $20 About $20 Verify all information on credit report is accurate and correct. If an error is found write a letter to Equifax and have them fix the mistake. Verify all information on credit report is accurate and correct. If an error is found write a letter to Equifax and have them fix the mistake.

11. Invest Tax advantage account TSP (Thrift Savings Plan) IRA (Individual Retirement Account) -Traditional-ROTH 401k (Civilian equivalent to TSP)

12. Traditional IRA Investment is tax free. Income tax is paid upon withdrawal, starting at age 59.5 Investment is tax free. Income tax is paid upon withdrawal, starting at age 59.5 Must start withdrawing at age 72 Must start withdrawing at age 72

13. ROTH IRA Investment is taxable. Withdrawal starting at age 59.5 is tax free. Investment is taxable. Withdrawal starting at age 59.5 is tax free. Withdrawals are not mandatory at any age. Withdrawals are not mandatory at any age. Can be willed to your heirs. Can be willed to your heirs.

14. IRA’s Maximum contribution is currently $3000 per year. Maximum contribution is currently $3000 per year. Can invest up to April 15 th for the year prior. Can invest up to April 15 th for the year prior. In 2004 max contribution is $3000 In 2004 max contribution is $3000 In 2005 max contribution increases to $4000 In 2005 max contribution increases to $4000

15. Example On March 30 th 2004 you can invest $3000 for FY 2003 and $3000 for FY 2004. On March 30 th 2004 you can invest $3000 for FY 2003 and $3000 for FY 2004.

16. Invest Start early Stay disciplined

18. Low risk investments Savings account, Money Market account 0.5% - 1.5% Savings account, Money Market account 0.5% - 1.5% CD (certificate of deposit) 1.0% - 3.5% CD (certificate of deposit) 1.0% - 3.5% Treasury Bills (Savings Bonds) Treasury Bills (Savings Bonds) – Rate changes every 6 months – Federal Reserve sets rate –Currently 2.61% for series EE bonds 2.19% for series I bonds 2.19% for series I bonds

19. Medium risk investments Mutual Funds Mutual Funds Sector FundsSector Funds Corporate Bonds Corporate Bonds Municipal Bonds Municipal Bonds Commodities Commodities

20. High risk investments Stocks Stocks IPO’s IPO’s Options Options

21. You control your financial destiny