1. Building Your Financial House WELCOME !

2. Program Objectives Become more comfortable talking about money issues
Identify the Framework for Building Your Financial House
Walk away with facts and skills needed to build your financial house
Gain confidence to make good money choices for your situation
Be in a better position for long-term financial stability and success.
Module 2: Maximize Earnings

3. Modules 1. Invest in Yourself 2. Maximize Earnings 3. Spend Sensibly
4. Check Taxes
5. Make Money Work
6. Protect Your Potential
7. Borrow to Grow
Module 2: Maximize Earnings

4. Recap: Invest In Yourself
Last time, we talked about:
The Framework for Building Your Financial House
Identifying your personal assets and opportunities
The education-to-income relationship
Setting goals according to your priorities
Module 2: Maximize Earnings

5. Did You Set a Goal?
Module 1: Invest In Yourself (PAGE IIY-3)

6. Did You Practice?
Module 1: Invest In Yourself (PAGE IIY-3)

7. Did You Learn More?
Module 1: Invest In Yourself (PAGES IIY-18 & 19)

8. Did You Make Progress?
Module 1: Invest In Yourself (PAGE IIY-3)

9. Module 2 Maximize Earnings

10. The walls represent earnings, built up from the foundation, and maximized by utilizing all available resources, directing payroll deductions, and choosing the right employee benefits.
Adrian
Review where this module fits within the Framework for Building Your Financial House.
-Next- 2
Maximize Earnings

11. Self-Assessment Module 2: Maximize Earnings (PAGE ME-3)
BYFH – Maximize Earnings (2016)

12. Objectives Knowledge Actions
Identify your cash and non-cash sources of income
Recognize the difference between gross and net pay
Become familiar with employer provided benefits
Recognize the actual dollar value of pre-tax benefits
Identify factors which affect the net economic benefit of a job
Review your pay statement
Calculate gross and net monthly income
Ask questions, compare options, and select the employee benefits that are right for you
Review your W-4 withholding allowances and adjust if necessary
Evaluate net economic benefit before accepting a new job offer
Module 2: Maximize Earnings

13. Income Four Square 1. CASH In 2. NON-CASH In 4. Options for More
3. “Off the Top”
Module 2: Maximize Earnings (PAGE ME-5)

14. Non-contributing household members
Short-Term Resources
COMPASS
Community
organizations
Non-contributing household members
Module 2: Maximize Earnings (PAGE ME-6)

15. Understanding Pay Statements
Module 2: Maximize Earnings (PAGE ME-7)

16. Sample Pay Statement 3 4 5 1 2
Module 2: Maximize Earnings (PAGE ME- 8)

17. Job Benefits Game
Module 2: Maximize Earnings (PAGE ME-10)

18. More Than Just a Paycheck
Employee Benefits:
Make people want to work for the company!
Help workers learn more job skills!
Keep workers healthy and secure their futures!
Module 2: Maximize Earnings (PAGE ME-12)

19. More Than Just a Paycheck
Financial gain using of benefits:
Free stuff
Discounted stuff
Lower taxes
Module 2: Maximize Earnings

20. More Than Just a Paycheck
Examples of benefits:
Paid time off
Insurance
Flexible spending accounts
Retirement plans
Module 2: Maximize Earnings

21. Paid Time Off Saves on travel expenses, gas, tolls
Saves child care expenses
Allows for learning opportunities
Module 2: Maximize Earnings

22. Insurance Options
Module 2: Maximize Earnings (PAGE ME-13)

23. Flexible Spending Accounts
Also called FSA’s
Used to pay for out-of-pocket medical and dependent care expenses
Money put in not subject to federal, state or social security income taxes
Use it or lose it
Module 2: Maximize Earnings

24. Calculating FSA Contributions
Module 2: Maximize Earnings (PAGE ME-14)

25. Retirement Benefits Pension (defined benefit plan)
Types:
Pension (defined benefit plan)
Defined contribution (savings) plans:
401(k)/403(b)/457
Profit sharing
Other lifetime benefits, such as health insurance, discounts, memberships
Module 2: Maximize Earnings (PAGE ME-15)

26. Why Should I Save? Top Five Reasons: Choose your future Employer match
Automatic
Compound interest
Lower taxes
Module 2: Maximize Earnings (PAGE ME-17)

27. “Pre-tax Contributions”
Side Bar: Lower Taxes
Tax-Free (FICA and Federal)
Health Insurance
Flexible Spending Accounts
Tax-Deferred (Federal)
Retirement Savings
“Pre-tax Contributions”
Module 2: Maximize Earnings

28. Case Study (Pages 7-11)
Module 2: Maximize Earnings

29. What Does Pre-Tax Really Mean?1 2 3 4 5 6
Module 2: Maximize Earnings

30. Net Economic Comparison
Anna’s Choice
ABC Inc.
Comparison
DEF Company
Annual Pay
Transportation Allowance
Gross Compensation
State/Local Income Taxes
FICA Taxes
Health Insurance (5%)
FSA Contribution
401(k) Contribution
Net Take Home
Transportation Cost
Professional Dress
401(k) Match
Tuition
Net Economic Comparison
$31,200 $
$29,120
$ 1,440
$31,200
$30,560
($ 1,405)
($ 2,270)
($ 1,560) $
($ 1,250)
($ 1,310)
($ 2,070)
($ 1,455)
($ )
($ 1,165)
$24,482
$23,960
Net economic comparison includes 401(k) savings added back.
($ 3,900) $
$ 1,250
($ 1,560)
($ ) $
$ 3,000
$22,720
$25,965
Module 2: Maximize Earnings

31. Anna’s Withholding Worksheet
Module 2: Maximize Earnings

32. Anna’s IRS Form W-4
Module 2: Maximize Earnings

33. NEW
EMPLOYEE
FEUD

34. What form must new employees complete that proves they are eligible to work in the United States?
1099
Module 2: Maximize Earnings

35. The IRS Form I-9 proves that a worker is eligible to work
in the United States.
Module 2: Maximize Earnings

36. What are you exempt from if you are an “exempt” employee?
Federal Income Tax
Bonuses
Overtime
Working
Module 2: Maximize Earnings

37. This is often confused with being “exempt” from tax withholding.
An “exempt” employee receives a flat salary regardless of how many hours worked.
This is often confused with being “exempt” from tax withholding.
Module 2: Maximize Earnings

38. Which is not a tax withheld from pay?
Sales Tax
Federal Income Tax
State Income Tax
FICA
Module 2: Maximize Earnings

39. Sales tax is not a tax withheld from pay but charged when making a purchase of certain items.
Module 2: Maximize Earnings

40. What form tells employers how much federal tax to withhold from pay?
1099
Module 2: Maximize Earnings

41. Employees must fill out an IRS Form W-4 to provide payroll deduction instruction for federal tax withholding.
Module 2: Maximize Earnings

42. Which is not an employee benefit deduction?
401(k)/403(b)
Flexible Spending Account (FSA)
Health Insurance
FICA
Module 2: Maximize Earnings

43. FICA is a tax withheld, not an employee benefit deduction.
Module 2: Maximize Earnings

44. What is the safest way to receive your wages?
Cash
Payroll card
Paycheck
Direct deposit
Module 2: Maximize Earnings

45. Direct Deposit it the safest way to receive your wages.
Cash is the least safest way, as it can be easily stolen and not accounted for properly.
Module 2: Maximize Earnings

46. BONUS
ROUND

47. What is FICA? Federal Income Credit Account
Federal Insurance Contribution Act
Federal Income Credit Act
Federal Income Calculation Account
Module 2: Maximize Earnings

48. FICA stands for the Federal Insurance Contribution Act, which is a payroll tax paid by both employee and employer for old age, survivor, and disability insurance.
Module 2: Maximize Earnings

49. THANKS
FOR
PLAYING!

50. What Comes In: Add It Up
Module 2: Maximize Earnings (PAGE ME-22)

52. Next Time: Spend Sensibly
Maximize Earnings
We’ve covered:
Earnings and other resources
Pay statements and deductions
Employee benefits
The actual dollar value of pre-tax benefits
Completing the Form W-4
Net economic benefits of a job
Next Time: Spend Sensibly
Module 2: Maximize Earnings

53. Take Action - Set a Goal
Module 2: Maximize Earnings (PAGE ME-3)

54. Take Action - Worksheets
Module 2: Maximize Earnings (PAGE ME-3)

55. Take Action – Learn More
Module 2: Maximize Earnings (PAGE ME-23)

56. Measure - Track Your Progress
Module 2: Maximize Earnings (PAGE ME-3)

57. Please complete the session evaluation form.
(Page ME-25)
Module 2: Maximize Earnings (PAGE ME-25)

58. Building Your Financial House Thank You!