1. Chap. 2 Career Aspects of Personal Finance Money and Financial Security –Wages and salaries provide Vast majority of income Important benefits –In a survey, 75% of students said #1 goal was being well off financially.

2. Chap. 2 Career Aspects of Personal Finance Job satisfaction –More important than income for many people –A critical ingredient in job success

3. Chap. 2 Career Aspects of Personal Finance Social Contribution –A Job that contributes to society really helps people makes a difference can be more important than income to some

4. Chap. 2 Career Aspects of Personal Finance Variables Affecting Income Potential –Education –Occupational earning patterns –Industry considerations –Geographical considerations

5. Chap. 2 Career Aspects of Personal Finance Education –Earnings gap between high school and college degree –College grad earned on average 1.8 times what high school grads earned –Gap is continuing to widen –Advanced degree holders earn 1.6x what bachelor degree holders make

6. Chap. 2 Career Aspects of Personal Finance Median Monthly Income and Educational Level

7. Chap. 2 Career Aspects of Personal Finance Financing Your Education –Federal programs  The largest source of aid for students  Programs financed or sponsored by U.S. government  Include loans and outright aid –Other sources of financial aid

8. Chap. 2 Career Aspects of Personal Finance Federal Programs include:

9. Chap. 2 Career Aspects of Personal Finance Pell Grant –Does NOT have to be repaid –Helps financially needy undergraduate students –Yearly maximum of $2,700

10. Chap. 2 Career Aspects of Personal Finance Federal Supplemental Education Opportunity Grant (FSEOG) –Does NOT have to be repaid –Helps financially needy undergraduate students –Yearly maximum of $4,000

11. Chap. 2 Career Aspects of Personal Finance Stafford Loans –Two types of LOANS Subsidized Unsubsidized –Obtained from U.S. Department of Education or financial institutions

12. Chap. 2 Career Aspects of Personal Finance Perkins Loan –Helps both undergraduate & graduate students –Low interest Loan -- repayment begins nine months after graduation –Maximum lifetime amount of $30,000

13. Chap. 2 Career Aspects of Personal Finance Federal Work Study (FWS) –Provides JOBS for both undergraduate and graduate students –Students earn at least minimum wage –Job always for public or non-profit private organization

14. Chap. 2 Career Aspects of Personal Finance PLUS Loans –Available to PARENTS with good credit records –Eligibility NOT based on financial need –Interest may vary but will not exceed 9% –Repayment (by parents) usually begins within 60 days after loan is received

15. Chap. 2 Career Aspects of Personal Finance Other Sources of Financial Aid –Private lenders –Special programs offered by federal government based on: a student’s academic talent (Robert C. Byrd Honors Scholarship Program) a student’s pursuit of a career in a certain field (Paul Douglas Teacher Scholarship Program) –State governments (for state residents attending state institutions)

16. Chap. 2 Career Aspects of Personal Finance Other Sources of Financial Aid –College scholarships and loans from alumni and wealthy donors –Loans to children of employees offered by some corporations –Cooperative education program Students work part of year in field related to studies Students attend class rest of year –Military service -- ROTC offers scholarships in exchange for active-duty obligation

17. Chap. 2 Career Aspects of Personal Finance The Importance of Continuing Education Even after graduation, the need for education continues: Continuing education hours required for some professionals (CPA’s, real estate agents) Programs designed for working adults Many employees offer tuition reimbursement and release time

18. Chap. 2 Career Aspects of Personal Finance Other Variables Affecting Income Potential -- Occupational Earning Patterns –Some occupations pay better than others –Two earning patterns Some occupations pay more at both starting level and top level Some occupations pay less at starting level, but have higher salary potential

19. Chap. 2 Career Aspects of Personal Finance Choosing a Career 1.Take a personal inventory  Consider Taking an Interest Evaluation 2.Determine where jobs will be in the future 3.Measure the career potential of an occupation 4.Consider preparing for an occupational cluster

20. Chap. 2 Career Aspects of Personal Finance Take a personal inventory –Define your career goals –List your skills and special talents –List your educational background –Analyze what you liked and disliked about previous jobs held –Explore your hobbies and interests

21. Chap. 2 Career Aspects of Personal Finance Determine where jobs will be in the future –Three occupational groups will have excellent growth rates in future professional specialty groups service groups technicians and related support groups –Many of fastest growing groups have workers with college degrees or technical training

22. Chap. 2 Career Aspects of Personal Finance Measure the career potential of an occupation  the industry’s growth prospects  the specific occupation’s prospects  the job’s location  the employer’s growth prospects

23. Chap. 2 Career Aspects of Personal Finance The industry’s growth prospects Career growth depends on health of industry Growing industries include: computer software and services health care  Declining industries include: manufacturing and mining aerospace and defense

24. Chap. 2 Career Aspects of Personal Finance Preparing for an Occupational Cluster An occupational cluster = a group of related jobs Seek General Qualifications in a Specific Field

25. Chap. 2 Career Aspects of Personal Finance The Self-Employment Option –Rewards Income potential directly related to how hard owner works –Risks Business failure (50% within two years) Erratic earnings More taxes paid by owners Benefits (i.e. health insurance) more expensive to provide for self

26. Chap. 2 Career Aspects of Personal Finance The Job Search 1. Contact all possible sources! 2. Write an effective resume 3. Include a cover letter 4. Handle the interview well

27. Chap. 2 Career Aspects of Personal Finance Contact All Possible Sources! –Friends, acquaintances, relatives –Campus placement office –Job service centers –Private placement agencies –Professional associations’ listings –Newspapers –Ads in trade publications –Electronic bulletin boards and databases –Direct solicitations of employers

28. Chap. 2 Career Aspects of Personal Finance Write an Effective Resume Basic components of a resume: Identification (lists name, address, etc.) Job objective (states job you are seeking) Background (describes education and work experience)

29. Chap. 2 Career Aspects of Personal Finance Write an Effective Resume –Focus on your skills related to job Don’t forget volunteer experience! –Be precise in describing accomplishments in present job –Concentrate on appearance Limit to one page Use readable font Print on high quality paper

30. Chap. 2 Career Aspects of Personal Finance Resume Formats Chronological order –lists work experience in chronological order Functional –highlights most important job skills Targeted –focuses on specific position

31. Chap. 2 Career Aspects of Personal Finance Include a cover letter A cover letter “sells” you to an employer. –Limit it to one page –Avoid form letters –Use a three-part structure 1. Grab the reader’s attention 2. Sell yourself to company 3. Call reader to action

32. Chap. 2 Career Aspects of Personal Finance Handle the interview well –Be prepared –Approach it from a position of strength and self-confidence –Listen carefully and ask intelligent questions

33. Chap. 2 Career Aspects of Personal Finance Be Prepared –Find out as much as you can about company’s products, structure, size, financial status, etc.

34. Chap. 2 Career Aspects of Personal Finance To prepare for an interview:  Study firm’s annual report  Read trade publications  Read articles in the press

35. Chap. 2 Career Aspects of Personal Finance Listen & Ask Intelligent Questions –Respond to questions as directly as possible –Ask questions about the company –Express yourself well (including dressing appropriately)

36. Chap. 2 Career Aspects of Personal Finance Deciding on a Job –If salary is too low, may be able to negotiate –Don’t appear too greedy –Consider the work environment –Consider the potential top salary

37. Chap. 2 Career Aspects of Personal Finance Fringe Benefits –May include--  health insurance  group life insurance  educational expenses  retirement plans