A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP Money Management In this session we will focus on saving, investing, insurance, credit and debt Greet participants and welcome them back. Briefly review what was discussed in the previous seminar--making a budget, balancing your checkbook, finding ways to earn extra income--and what is to come in today’s seminar. --Saving and investing --Ideas on how to save more --The importance of insurance --How to save on insurance --Seeking help for overwhelming debts MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP Saving & investing What are your Financial Goals? Saving and investing can help you to reach your short-term and long- term goals. Invite participants to mention some of the goals that they listed in their Financial Goals Worksheet. Emphasize that saving and investing are two important ways to achieve financial goals. MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP How to save more “Pay yourself first” by scheduling automatic deposits on pay day that go into your savings account or IRA (individual retirement account) Review the saving ideas on this slide (continued on the next two slides). MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP Retirement accounts Does your employer offer a retirement savings plan? Employer-sponsored plans can help your retirement savings grow faster because you do not have to pay taxes on the earnings until you are eligible to withdraw from the account, at age 59 1/2. No notes for this slide. MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP Saving - CDs A CD (certificate of deposit) is a safe way to save. Like savings accounts, CDs are insured by the government. CDs often earn a higher interest rate than savings accounts do. However, CDs require that you leave your money for a set period of time, such as six months or a year. No notes for this slide. MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP Investing An investment is the use of money to create more money Stocks, bonds and mutual funds are all types of investments Consider an investment advisor. Be cautious—investments are not government-insured and you could lose your money. Briefly review the differences between stocks, bonds and mutual funds. Mention that a good way to find a good investment advisor is to ask friends and relatives for a recommendation, or ask if your bank offers this service. Always compare at least two advisors (or more) before signing on with one. Check that the professional is properly licensed by asking the advisor for the proper state or federal agency to call. MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP Insurance What are the benefits of having insurance? Insurance protects you against financial ruin as a result of an unforeseen catastrophe like fire, theft or medical emergency. Tie insurance in to good money management: insurance protects your property so that you don’t lose your savings or fall deeply into debt. MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP Kinds of insurance What are the most important types of insurance for you and your family? Automobile insurance Health insurance Homeowner’s or renter’s insurance Life insurance Review the benefits of having these types of insurance. Be sure to discuss the possible advantages of having more than the required minimum amount of auto insurance. MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP Saving money on insurance Always ask if you are eligible for any insurance discounts. Internet sites can help you compare premiums: Insure.com (www.insure.com) InsWeb (www.insweb.com) Quick Quote (www.quickquote.com) Lower Rate Quotes (www.lowerratequotes.com) Mention some examples of auto insurance discounts, such as discounts for having air bags in your car, having a good driving record or being a senior citizen. You can also mention the advantages to opting for a higher deductible. Be sure to explain what a deductible is: A deductible is a certain amount that you (the policyholder) must pay for out of your own pocket before insurance coverage kicks in. For example, with a $500 deductible, you would be responsible for the first $500 (car or home repairs, or medical bills) before insurance would pay for covered services. MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP Credit Good credit can help you: Rent an apartment Purchase a home Get a job Set up phone and power service. Buy ‘big-ticket’ items without cash Borrow money Obtain a credit card Rent a car Alert participants to the MoneyWI$E “Building and Keeping Good Credit” brochure. (Make sure you have copies of the other MoneyWI$E brochures on hand to pass out.) MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP To build good credit... Pay your bills on time. If you carry a balance, pay as much as you can each month. No notes for this slide. MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP Rebuilding credit If you have damaged your credit, try applying for credit with local businesses or for a secured credit card (a bank credit card backed by money you deposit in a bank account.) No notes for this slide. MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP Home equity loans Home equity loans can be used to consolidate debt. Be very careful before taking out a loan secured by your home (a home equity loan or line of credit). If you fail to make a payment, you risk losing your home. Discuss the risks of a home equity loan. Alert the group that there are fraudulent home equity loan salespeople out there who often prey on minority or language groups and senior citizens. Advise participants to read every contract thoroughly before signing, particularly if their home is at stake. MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP Good credit Try to avoid these expensive credit options: Pawn shops, pay day loans, and car title pawn shops Offers to buy things on credit with deferred interest Credit cards with rates higher than the national average (check www.bankrate.com for average) Discuss the ways in which the costs of these credit options can add up. Here’s an example you could use: On a $1,000 credit card balance at 18% interest, it will take you 10 years to pay your debt if you paid $30 per month. In that time, you will pay $798.91 in interest. Paying the same $30 monthly payment on a13% credit card will take you a little over 8 years to be rid of your debt. In that time, you will pay $459.26 in interest. That’s almost two years less and a savings of $339. (FYI: This example uses a 3% minimum monthly payment.) MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP

A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP Overwhelmed by debt? The National Foundation for Consumer Credit - (800) 388-2227 or www.nfcc.org can refer you to a credit counselor in your area. Low- or no-cost services help you establish a repayment plan. Debtors Anonymous (781) 453-2743; www.debtorsanonymous.org No notes for this slide. MoneyWI$E A CONSUMER ACTION AND CAPITAL ONE PARTNERSHIP