1. PERSONAL FINANCE 101

2. CREATING AND MANAGING A BUDGET: KNOW YOUR HABITS First, “know your habits” by tracking your expenses to fully understand how you spend your money

3. SECOND, DO THE MATH! DETERMINE YOUR MONTHLY INCOME MINUS EXPENSES Total Monthly Take-Home Income (minus taxes, health insurance, other payroll deductions, 401K) $ Household Expenses Rent or Mortgage $ Utilities (water, sewer, gas/electricity) $ Home/Cell Phone $ Groceries $ Other Household (Cable, etc.) $ Transportation Expenses Car Loan Payment $ Gas, Tolls, Parking, Other $ Car Insurance (set aside if paid annually or semi-annually) $ Other Expenses Pet (Food, Vet) $ Insurance/Co-pays, Prescriptions $ Fun (entertainment, dining out, move rental, etc.) $ Minus Total Expenses$ Total Monthly Surplus/Shortage$ C REATING AND MANAGING A BUDGET : INCOME V EXPENSES

4. LITTLE SAVINGS ADD UP… ITEMANNUAL COSTALTERNATIVEANNUAL COST One Cup of coffee daily at a Coffee shop ($3) $1,095 Gourmet coffee brewed at home $176 One CD weekly ($12.99) $ 675 Download individual songs you like ($1) $375 Pizza delivery once a week ($10) $ 520 Gourmet frozen pizza at the grocery ($5) $260 Eating lunch out 5 days a week ($5 per lunch) $1,250Bring your lunch to work 5 days a week ($1.50 per lunch) $375 Total Annual Savings of $2,354!

5. CREATING AND MANAGING A BUDGET: WANTS V NEEDS Wants versus Needs! – Do I have to have it today? – What will happen if I don’t buy it? – How have I managed this long without it?

6. New Car vs. Older Car New 2009 Honda Accord EX Cost: $24,000 Payment: $476 Insurance: $ 78 Monthly difference: $176 Annual difference: $2,112 Used 2003 Honda Accord EX Cost: $14,483 Payment: $305 Insurance: $ 73 Car Cost/Payment Source: www.edmunds.com Based on financing for 60 months. New car interest rate of 7.11%; Used car interest rate of 7.35%. Car Insurance Cost Source: www.geico.com Insurance rates for a 25-year-old single male with a clean driving record.www.edmunds.comwww.geico.com

7. INCOME Take-home pay minus taxes, social security, health insurance, 401K CREATING AND MANAGING A BUDGET: SAMPLE BUDGET Based on 60% solution from msn.Money FIXED EXPENSES:60% Rent/Mortgage, Utilities, Home/Cell phone, Commuting, Car payment, Insurance, Work-related (clothes, dry- cleaning), Student Loan Payments, Credit Card Payments SAVINGS:20% Money set aside for vacations, major repairs, new appliances, to pay down existing debt, emergencies a down-payment on a car or house, charity RETIREMENT:10% Ideally, 10% of your gross income JUST FOR FUN:10% Everybody needs some fun

8. CREATING AND MANAGING A BUDGET: MONITOR YOUR BUDGET Commit to your budget Track and compare actual expenses against monthly budget Make choices to reduce expenses Start saving for your short and long-term needs

9. POWER OF COMPOUNDING: START SAVING NOW! SAVING $1 A DAYAMOUNT YOU PUT INACTUAL WORTH* Year 5$1,825$ 2,013 Year 10$3,650$ 4,591 Year 20$7,300$12,069 Year 30$10,950$24,250 *Assumes $365 is deposited at the end of each year for the # of years listed. Return is compounded annually. Above amounts are pre-tax. Source: www.taxtips.ca

10. PRO’S AND CON’S OF CREDIT CARDS Although credit cards may seem like your ticket to buying anything you want… …..but it is important to understand just how much that little piece of plastic could really cost you…

11. May charge late fees if you are late making a payment? Could be as much as $50! May not have grace periods? Meaning interest starts accruing as soon as you charge. May have low introductory interest rates that increase dramatically over time? That 2.9% could go to 22% just like that! May charge annual fees? Could cost you $50 just to have the card! May charge a transaction fee for cash advances and the interest starts immediately? A percentage of your cash advance amount is added to your balance. May charge a fee for going over your limit, and for every month you remain over your limit? Another $50 added to your balance! Did you know credit card companies…

12. Once you have a balance, making the minimum monthly payment won’t make much of a difference… PRO’S AND CON’S OF CREDIT CARDS

13. HOW LONG WOULD IT TAKE TO PAY OFF IF… Your credit card balance is $2,500 You pay the $50 minimum monthly payment each month The interest rate is 20% You don’t charge anything else to this card

14. 109 months or 9 Years + 1 month! (yes, that’s right) PRO’S AND CON’S OF CREDIT CARDS 109

15. PLUS…….Over those nine + years, you will have paid a total amount of $4,430 for initial charges of only $2,500 That’s $2,920 in interest alone!! Source: www.bankrate.com PRO’S AND CON’S OF CREDIT CARDS

16. BENEFITS: Helps build credit history Builds financial management skills Provides emergency protection and enhanced security Makes purchases convenient

17. Saves you money Qualifies you for better interest rates Makes it easier for you to rent an apartment Makes it easier for you to buy a car PRO’S AND CON’S OF CREDIT CARDS

18. Limit yourself to one card Read the fine print regarding rates, fees and introductory offers Make your payments on time, and try to pay more than the minimum Begin with and keep a low credit limit — one you can easily pay off (try $250 or $500) Know your credit limit and NEVER go over If you can eat it, wear it, or drink it, don’t charge it! Think before you charge CREDIT CARD TIPS

19. ADDITIONALLY… Limit cash advances – they come with costly fees and higher rates Protect your identity – never lend your card to a friend

20. CREDIT FITNESS: WHY IT IS IMPORTANT! Credit history can impact: Purchasing a car/home The rate you receive on a loan Renting an apartment Auto and life insurance Seeking employment

21. Identity thieves are always on the look out for your personal information… PROTECTING YOUR IDENTITY…

22. What should be protected? Social Security # Credit Card #s Bank Account #s Driver’s License # Date of Birth Mother’s maiden name Personal ID # (PINs) and passwords

23. How do they get your information? Dumpster diving Skimming, Phishing Changing your address “Old-fashioned” stealing – Wallet/purse – Mail, New Checks or Tax Info – New checks or tax info PROTECTING YOUR IDENTITY…

24. How is stolen information used? Change the billing address on your existing credit card accounts and then charge on them Open new credit card accounts in your name Access your bank accounts Take out loans in your name (i.e., auto loans, student loans) Establish phone or wireless service in your name Write bad checks in your name PROTECTING YOUR IDENTITY…

25. Source: Consumer Fraud and Identity Theft Complaint Data, January-December 2007; Federal Trade Commission, February 2008 ID THEFT BY PAYMENT METHOD JANUARY 1 – DECEMBER 31, 2007

26. Protect Your Identity! Shred documents before trashing Pre-approved credit offers, bank/credit card statements, credit card receipts Be careful at ATMs, or when using your debit card that others do not see your PIN Have checks delivered to your bank rather than your home Do not put checks in the mail from your home mailbox--drop them off at a U.S. Mailbox or the U.S. Post Office Empty your wallet of all extra credit cards and social security numbers, etc. Never give out any of your personal information over the phone

27. Protect Your Identity! Do not put your social security number on your checks Do not put your telephone number on your checks Do not put your credit card account number on the Internet (unless it is encrypted on a secured site) Don't put account numbers on the outside of envelopes, or on your checks In conjunction with a credit card sale do not provide your address, telephone number, or driver's license number Monitor all your bank and credit card statements monthly Check your credit at least annually

28. WHAT TO DO IF YOU’RE A VICTIM… Contact the Federal Trade Commission to report it and get guidance Call the three major credit bureaus (Equifax, Experian, TransUnion) so they can put an alert on your credit File a report with your local police department Contact any businesses where the identity thief fraudulently conducted transactions in your name Contact your banks and credit card companies Keep notes on every phone call, meeting, and conversation Follow-up any phone conversations with an e-mail or letter