Turning Point Finance Workshop Powerpoint

Whatcom Community college Turning Point Finance Workshop: 

Whatcom Community college Turning Point Finance Workshop Presented by Kimberly Oesterling January 14, 2010

Financial Goals: 

Financial Goals

How Compounding Works : 

How Compounding Works Year 5% 1 $100

Compounding Example: 

Compounding Example Year 5% 1 $100 5 $128

Compounding Example cont…: 

Compounding Example cont… Year 5% 1 $100 5 $128 10 $163

Compounding Example cont…: 

Compounding Example cont… Year 5% 1 $100 5 $128 10 $163 15 $208

Compounding Example cont…: 

Compounding Example cont… Year 5% 1 $100 5 $128 10 $163 15 $208 25 $339

The Rule of Money Bianca and Patrice: 

The Rule of Money Bianca and Patrice Bianca saves $10,000 from age 15-25 then stops saving but leaves the money in the bank until age 65 @ 12% interest Patrice saves $10,000 a year for 25 years (age 40-65) Who has more money?

The Rule of Money Bianca and Patrice: 

The Rule of Money Bianca and Patrice Bianca does! $10,000/10 years = $1.8 million at age 65 Patrice scrimped and save $250,000/25 years= $1.5 million

The Rule of Money: 

The Rule of Money The rule in a nutshell: Saving ________ Time =

Creating a Budget: 

Creating a Budget Step 1 List Gross Income Step 2 Determine Net Income Step 3 List Expenses housing medical/dental food miscellaneous transportation investments/savings insurance school/childcare Debts entertainment/recreation Clothing

Creating a Budget cont…: 

Creating a Budget cont… Example- Family of 4 earning $35,000/year (From Net Income $27,675) Housing- 36% Food- 12% Auto- 12% Insurance- 5% Debt- 5% Entertainment/Recreation- 5% Clothing- 5% Investments/Savings- 5% Medical/Dental- 4% Miscellaneous- 5% School/Childcare- 6%

Creating a Budget cont…: 

Creating a Budget cont… Gross Income - $35,000 minus 25% for taxes Net Income $26,250 Monthly Expenditures $2,188 Housing $788 (including utilities) Food $263 Auto $263 Insurance $109 Debts $109 Entertainment/Recreation $109 Clothing $109 Savings/Investments $109 Medical/Dental $88 School/Childcare $131 Miscellaneous $109

Ways to stretch your dollar Grocery Shopping: 

Ways to stretch your dollar Grocery Shopping Shop for produce at a local farm stand Limit buying snacks out like coffee or soda Shop with a grocery list Take advantage of sale items that you would normally buy Plan meals according to what is on sale that week/Play the grocery store game Take advantage of rebates Shop at discount marts i.e. The Dollar Store, Grocery outlet, etc. Buy enough of sale items to last 12 weeks (the usual cycle of sales) Use double coupons Bring your own bags

Ways to stretch your dollar Cooking and Eating: 

Ways to stretch your dollar Cooking and Eating Eat less meat or become vegetarian Eat left-overs Cook large amounts and freeze extras for a busy night Cook from scratch Eat from your stocked pantry Limit dining out Take your lunch to work Eat less Keep soup starter jars in the freezer (never waste) Always have a meal plan Limit intake of soda, drink water Join a freezer club in your area Make your own baby food If your kids complain about generic, put the generic cereal in a non-generic box

Ways to stretch your dollar Cars and Gas: 

Ways to stretch your dollar Cars and Gas Run errands once a week using the most efficient route Walk as much as you can Stay home Keep tires filled to their proper pressure Carpool Use public transportation Try to get by with one car if you have more than one Keep up on your car’s maintenance Gas up your car early in the morning when the air is cool and the gas is dense Fill up your tank when it is half empty

Ways to stretch your dollar Utilities and Around the house: 

Ways to stretch your dollar Utilities and Around the house Put everything on power strips and turn off electrical items at the plug at night Let dishes air dry in the dishwasher Cancel cable Keep lights off during the day Don’t use hot water in the summer Turn down the thermostat and don’t use the heater at night Limit water running while brushing teeth or doing dishes Use rechargeable batteries Accept hand-me-downs Do home repairs yourself Use kitchen rags instead of paper towels Wash and reuse Ziploc bags Email for free samples Move in with roommates Rent from an owner and not a corp. (can get utilities paid)

Ways to stretch your dollar Clothing and Medical: 

Ways to stretch your dollar Clothing and Medical Limit clothes shopping Shop at thrift stores or consignment stores Have children change into play clothes after school Use a flexible spending account or cafeteria plan, so you can pay out-of-pocket medical expenses with pre-tax dollars Ask your doctor to prescribe generic medications Buy generic medication at Wal-Mart or Target. They have a lot of different medications available for $4

Ways to stretch your dollar Entertainment: 

Ways to stretch your dollar Entertainment Cancel magazine subscriptions Use the library for books, magazines, and movies Read newspapers online Celebrate “no spend” weekends, where you don’t spend anything Eat out only once a month Use hotel points and airline miles for vacation Split an entree with someone else when you go out for dinner Do free things for entertainment: Hiking, free city concerts, board games Only order from the dollar menu when eating out Take advantage of “get in free” days at the museum, etc. If you find that you go somewhere a lot (a zoo, amusement park), buy a season pass Entertain at home Trade babysitting with friends

5 Steps to Improving your credit: 

5 Steps to Improving your credit Step #1 Order your credit report Step #2 Examine your reports carefully Step #3 Dispute and document errors Step #4 Dissolve your debt Step #5 Add stability to your credit file

References: 

References The Rule of Money http://www.fool.com/investing/beginning/why-should-i-invest.aspx Budgeting http://www.crown.org/ How to stretch your dollar http://beingfrugal.net/2008/04/03/frugal-tips-to-survive-a-recession/ Credit Repair http://www.credit.com/credit_information/credit_help/Five_Steps.jsp