Financial Literacy PDF

 Budgeting Basics Evaluating your Finances - Tracking your income and expenses - Assess your Income. Income: Know exactly how much money you’re bringing. Source of Income : Identify...

 Budgeting Basics Evaluating your Finances - Tracking your income and expenses - Assess your Income. Income: Know exactly how much money you’re bringing. Source of Income : Identify all scorches of income, such as your in,including salary, side gigs, or any other source. salary, side gigs, investments, or rental income. Ensure you account. Expenses: Record all your spending, including fixed expenses for the net income( after tax) rather that gross income when evaluating ( rent, utilities, insurance) and variable expenses ( groceries, your budget. entertainment, dining out ).. Stability: Consider the stability of your income. If it’s irregular or -Set Financial Goals fluctuating, plan accordingly by adjusting your expenses and building a larger.Identify short-term and long-term financial goals, such as saving for a emergency fund - Evaluate your savings and investments vacation, paying off debt, or building an emergency fund. Have clear goals helps prioritize your spending -Create spending Categories. Emergency fund: Ideally, you should have 3-6 months of living expenses saved in an easily accessible accounts (e.g., savings account) for unexpected situations. If you’re lacking this, prioritize..Fixed Cost: These are consistent monthly expenses, like. Retirement savings: Review your retirement accounts (401(k), IFA, pension plans) rent, utilities, and insurance premiums. and check if you’re on track to meet your retirement goals. Ensure you’re taking.Variable Costs:These fluctuate, like groceries, transportation, advantage of employer matches if available. and entertainment. Other investments: Assess other assets like stocks, bonds, or real estate..Savings and Debt Repayment: Set aside a portion of your Review their performance and do ersiyu of your portfolio to manage risk income for savings and debt repayment effectively. - The 50/30/20 Rule.50% Needs: Essential living expenses ( housing, utilities, food, - Review your debt. Debt types: List all debt, including credit cards, student loans, healthcare).. 30% Wants: Non- essential but enjoyable spending (dining car loans,and mortgage. Note the interest rates,monthly out, entertainment, vacations ). payments, and remaining balances..20% savings/Debt: Allocate at least 20% of your income to. Debt-to-income ratio: Calculate your debt- to -income ratio ( monthly debt savings or debt repayment. payments divided by monthly income) to understand how manageable your - Build an Emergency Fund debt is.. Aim to save at least 3 to 6 months’ worth of living expenses in. Paying down debt: Prioritize high-interest debts ( like credit cards) first case of unexpected events, like job loss or medical emergencies and consider refinancing or consolidating if it lowers interest rates. - Use Budgeting Tools - Insurance Coverage. Considering using apps (like Mint, YNAB, or Everydollar) to track. Adequacy: Review your health, life, auto, home, and disability insurance. Ensure spending, categorize expenses, and set savings goals. These can help you have sufficient coverage for you needs. you stay on track.. Cost-effectiveness: Shop around periodically to see if there are better, more cost- effective options without sacrificing coverage. - Review and Adjust Regularly. Adjustments: Life changes like marriage, children, or purchasing a home. Monitor your budget monthly.Life circumstances change, so adjust your may necessitate adjustments in your insurance coverage. budget as necessary to reflect new priorities or changes in income/ expenses. - Calculate your net worth -Avoid Impulse Spending. List your assets: Include savings, investments, real estate, and. Plan your purchases in advance and stick to your list. other valuables. Consider using the 24- hour rule: wait 24 hours before making. List your liabilities: Include credit card debt, loans, mortgages, etc. an impulse purchase to determine if it’s really necessary.. Net worth: Subtract your liabilities from your assets to calculate your net - Cut Unnecessary Costs worth. Monitoring your net worth over time gives you a clear picture of your. Review your spending regularly and look for areas where financial health. you can reduce costs, such as canceling subscriptions you - Seek Professional Guidance ( if necessary) don’t use, cooking more at home,or shopping for better deals.. Financial advisor: if you’re unsure about certain areas like investments or tax’s, -Prioritize Debt Repayment consider consulting a financial advisor for personalized advice.. If you have high-interest debt(like credit cards), prioritize. Tax planning : You might also want to speak with a tax professional to paying off it to avoid accumulating more interest. Use optimize your tax situation, especially if you have complex financial strategies like the avalanche( pay highest interest first) or circumstances snowball (pay smallest balance first) methods.  Creating a Budget Budgeting Benchmarks - Question your needs and wants: -Tips for students. Make two lists: one for needs and one for wants.. Establish budgeting habits to track progress and achieve financial milestones, like paying off loans or saving for a car.. Ask yourself why you want each item, how it would improve your life, and which items are essential.. Identify your financial priorities, whether your parents over housing or you’re. Reevaluate your needs before making purchases that impact paying rent, and adjust your budget accordingly.. Set monthly goals to manage expenses like meals and housing, and prepare your budget. for new responsibilities. - Set Guidelines: - Planning as a New Employee. Balance your budget by setting clear guidelines for both needs and wants.. When starting a new job, reevaluate your budget to reflect changes in income. If you splurge on something (e.g., a vacation), adjust other expenses that and expenses. month to stay on track.. Lower expenses where possible, and increase savings for future goals. - Track, Trim, and Target:. Take advantage of employer benefits, like 401(k) retirement savings plans,. Track your spending to identify areas where you can cut back, like dining out which offer tax-deferred growth until retirement. - Challenges for Parents: or entertainment.. Focus on trimming unnecessary expenses rather than eliminating them entirely for a more sustainable budget.. Raising a child adds significant financial responsibility, with an estimated cost of $245,000 for birth to age 18.. Create specific and realistic financial goals to balance a family budget, covering areas like emergency funds, education, housing, and vacation.. Adapt your budget as your family grows, addressing new challenges like daycare and college expenses. - Budgeting as a Retiree:. Retirement changes your financial situation, so plan ahead by exploring retirement options and preparing for programs like Social Security and Medicare.. Budget for retirement early to secure your future, and stay informed on laws affecting government programs.. Many retirees work part time to offset expenses, but advanced planning is key to financial stability in retirement.  Saving Basics Choosing Savings Options - Create a budget: - Basic Bank Savings Accounts:. Overestimate your expenses to leave room for savings, and stick to Offer low interest (usually under 1%) and easy access to funds, with no required your budget. minimum balances. - Money Market Accounts: - Pay yourself first: Higher interest rates than basic savings, but often require a higher. Set aside 10-12% of your income each month, treating it like a non- minimum balance. negotiable bill. - Online Savings Accounts: - Save wisely: Similar to basic savings, but offer higher interest rates since they operate without the overhead of traditional banks.. Choose the best savings methods and research options with favorable - Credit Union Savings Accounts: interest rates. Typically offer better interest rates than banks, as credit unions are - Prepare for the unknown: member- owned.. Build an emergency fund covering 3-6 months of living expenses for - Automatic Savings Plans: Allow you to set up automatic transfers from your checking account to your unexpected costs. savings, helping you save consistently. - Set Financial Goals: A certificate of deposit (CD) is a low- risk savings options that offers higher interest. Define clear, realistic financial goals to stay on track and measure rates in exchange for locking your money away for a set period, for several months to years. Early withdrawals may incur penalties. progress over time. - Traditional CDs: - - SMART goals help make savings clear and achievable: Fixed interest rate for a set term, with access to funds after the term ends. - Specific: - Bump-Up CDs: Set a clear goal( e.g., saving for a vacation). Allows you to increase the interest rate during the term after an initial - Measurable: lower rate. Track progress with numbers( e.g., $3,000 goal, $800 saved). - Brokered CDs: Purchased through a brokerage, typically offering higher rates than - Attainable: banks CDs. Ensure the goal is realistic (e.g., saving $100 per week ). - Relevant: Align the goal with your values ( e.g., saving for a home). - Time- related: Set a deadline ( e.g., save $3,000 by June).  Growing you money Building an emergency fund An emergency fund is money saved for unexpected expenses like medical bills or home repairs. It’s essential because emergencies can The Rule of 72 and attention to detail when reviewing financial institution documents are key happen at any time, and having a fund helps you avoid financial strain. to maximizing savings. By understanding fees, charges, and interest rates, you can avoid Experts recommend saving three to six months’ worth of living losing money to penalties. Compound interest can also grow your savings significantly; for instance, a $100 deposit at 6% interest would grow to $112.36 in one year with compounding. expenses. Over 40 years, that $100 could grow to over $1,000. The Rule of 72 helps you estimate how long it takes to double your money—just divide 72 by your interest rate. For example, at 6%, it To start, set a monthly savings goal and automate transfers to a would take 12 years to double your savings. Being aware of these concepts will empower you savings account. Keep the fund in a safe, liquid account so you can to manage your money more confidently. access it quickly if needed. The amount you save should be based on your financial situation, but it’s important to consistently set aside money each month, even if it’s a small amount. 1. Make savings a priority by setting aside a portion of your income each time you’re paid, regardless of the amount. 2. Automate your savings by setting up automatic transfers from checking to savings through your bank or mobile app. 3. Find money to save by tracking your spending for a week and adjusting your habits to save more. 4. Keep the change by collecting loose coins and exchanging them for cash to put into savings. 5. Cancel extra costs by reviewing and canceling unused subscriptions, such as gym memberships or streaming services, to save hundreds each year.  Opening a checking account. Financial Institutions Basics 1. Security: Your deposits are protected by the When choosing a checking account, FDIC, insuring up to $250,000, ensuring your consider your habits and preferences. money is safe from theft or loss. Many banks offer free checking accounts 2. Convenience: You can access your money easily if you set up direct deposit or maintain a through ATMs, online banking, or customer service, and set up direct deposit for quicker minimum balance. Be mindful of potential paychecks. fees, such as ATM fees for using out-of- 3. Budgeting: Reviewing bank statements helps network ATMs, and overdraft fees if you you track your spending and stay on budget by spend more than your balance. Once showing where your money is going. you’ve researched your options, choose 4. Making More Money: With interest on your balance, bank accounts allow you to earn money an account that fits your needs and offers on your savings, with interest added monthly. the best features for managing your money efficiently.  Debt Cards and Prepaid Cards Electronic Banking 5 Smart Debit Card Practices: Electronic banking offers three main benefits: 1. Always know your bank account balance and ATMs, direct deposits, and debit card available funds. purchases. 1. ATMs provide 24/7 access to withdraw, 2. Be aware of your daily withdrawal and deposit, and transfer funds between accounts. spending limits; contact your bank if you need to 2. Direct Deposit allows your employer to adjust them. automatically deposit paychecks and lets you 3. Get cash back when making purchases to set up automatic payments for recurring bills, avoid ATM fees. ensuring timely transactions. 3. Debit Card Purchases offer the convenience 4. Set up alerts for activities like large of credit cards, but the funds are directly transactions or changes to your account. deducted from your account, preventing 5. Notify your bank ahead of time if you plan to overspending. use your debit card out of state or internationally to prevent security alerts. Using electronic banking improves convenience and helps you track transactions. You can also manage your finances via mobile How Prepaid Cards Work: banking for added flexibility. Prepaid cards aren’t tied to a bank account. You load money onto the card, and the balance is deducted as you make purchases. They can be used to make purchases, withdraw cash, reload with funds, receive direct deposits, or give as gifts. Prepaid Cards as Financial Tools: For Teaching Budgeting: Prepaid cards help young people practice budgeting and using ATMs without the risk of overdrawing, as they aren’t linked to a credit line. Parents can also monitor the account online. As an Alternative to Check Cashing: Prepaid cards can be a cost-effective alternative to check cashing services, allowing for direct deposit of checks without expensive withdrawal fees. For guidance on filling out financial forms, use step-by-step guides for making deposits, writing checks, using a transaction register, and reading bank and credit card statements.  Mobile Banking Credit Basics Here are 10 key credit card terms to understand: Mobile banking allows you to manage your finances on-the-go, offering features like 1. Annual Fee: The yearly cost of owning a credit checking balances, tracking spending, reviewing card; some cards offer no fee. account history, locating ATMs, depositing 2. APR (Annual Percentage Rate): The interest rate checks, transferring funds, paying bills, and charged annually on outstanding credit balances. receiving alerts. 3. Balance: The amount of money owed on a credit card or in a savings account. Benefits include 24/7 access to your money, 4. Credit Bureau: Agencies (Equifax, Experian, convenience, and no fees from most financial TransUnion) that collect credit information. institutions. Mobile banking apps are tailored to 5. Credit Line: The maximum amount you can each bank’s services. charge on your credit card. 6. Credit Rating: An evaluation of your ability to Security is a common concern, but mobile manage debt, affecting borrowing options. banking is secure, with advanced features like 7. Grace Period: The time after a payment is due to fingerprint authentication and NFC technology pay without incurring interest or fees. ensuring safe transactions. 8. Introductory Rate: A low interest rate offered initially to attract new cardholders, which changes Overall, mobile banking simplifies managing your after a set period. money, providing easy access and enhanced 9. Minimum Payment: The least amount you must security. pay each month to keep your account in good standing. 10. Overdraft Protection: A service linking your checking account to prevent overdrawing. Pros of Credit: 1. Instant Purchasing Power: Credit provides flexibility to cover emergency expenses and pay over time. 2. Security: Lost credit cards can be canceled, and unauthorized use can be prevented with prompt reporting. 3. Record Keeping: Credit card statements help track monthly spending, aiding in budgeting. 4. Convenience: Cards are widely accepted and faster than checks for payments. 5. Bill Consolidation: Payments can be automatically charged to your card, simplifying multiple payments. 6. Rewards: Credit cards with reward programs offer benefits like travel perks. Cons of Credit: The primary downside is the potential cost from interest and fees. To avoid this, it’s important to track spending and pay off your balance in full each month.  Credit Scores Credit Report Your FICO score ranges from 300 to 850 and helps lenders A credit report is a detailed record of your financial assess your credit risk—higher scores indicate lower risk. history, showing how you’ve managed money, including debts, unpaid bills, bankruptcies, and 10 Tips to Maintain a Strong Credit Score: credit card usage. It helps lenders, landlords, and employers assess your reliability. 1. Fill out credit applications accurately. 2. Use credit cards responsibly and avoid maxing them out. Who can see your credit report? 3. Understand credit card terms before applying. Lenders, banks, credit card issuers, auto financing companies, insurance companies, landlords, and 4. Pay off your balance in full each month, or at least make potential employers may review your credit report. the minimum payment. Employers usually need your written consent. 5. Always pay bills on time. Beware of “Fast Fixes”: 6. Contact creditors if you’re having trouble paying. Negative items like late payments, foreclosures, 7. Notify creditors if you change your address. and bankruptcies can stay on your credit report for 8. Report lost or stolen cards immediately. up to 7–10 years. Be cautious of companies claiming to fix credit problems for a fee, as it’s 9. Regularly check your credit report for errors and dispute legally impossible to alter accurate credit history. inaccuracies. For help, consider contacting a nonprofit credit counseling agency. 10. Maintain a steady work history. Credit Resources Building Credit You are entitled to a free credit report every A credit score changes based on your debt and bill 12 months from each of the three major credit management. To build credit wisely, understand the bureaus (Equifax, Experian, and TransUnion). Five C’s of Credit: To access your report, visit 1. Character: Lenders assess your reliability to repay annualcreditreport.com. debt through your credit history, bill payments, and job stability. Paying on time is crucial to building trust. 2. Capital: Lenders look for valuable assets like real Review your credit report regularly for errors, estate or savings to ensure you can repay if income is unavailable. Saving for these assets can improve your such as incorrect payments or accounts. If credit. you find inaccuracies, contact the credit bureau immediately to report the issue. If the 3. Capacity: This refers to your ability to pay off debt, problem isn’t resolved, provide a written considering your income, existing debts, and dependents. explanation to include with your report. 4. Collateral: For some loans (like auto loans), lenders may require assets to secure the loan. 5. Conditions: Economic factors that could impact Contact Information for Credit Bureaus: your ability to repay. Equifax: 1-800-685-1111, Fraud: 1-888-766-0008, equifax.com The 20-10 Rule advises borrowing no more than 20% Experian: 1-888-397-3742, experian.com of your annual income and ensuring loan payments don’t exceed 10% of your monthly income. TransUnion: 1-877-322-8228, Fraud: 1-800-680-7289, transunion.com A secured credit card can help build or rebuild credit by limiting spending to your deposit amount. If you make timely payments, you may transition to an unsecured card, which can further boost your credit score.  Debt Basics Understanding Debt Load When managing debt, it’s important to have a clear 1. Calculate Monthly Debt Payments: Add up all repayment plan, as interest on debt compounds over time, as your monthly debt payments. If some aren’t fixed, making it easy for a small amount to grow. estimate them as a percentage of the total debt. 2. Determine Monthly Income: Divide your gross The Power of 50: By paying just $50 more a month on a annual income by 12 to get your monthly income. $3,000 debt with 18% annual interest, you can cut your repayment time from 8 years to 3 years, saving over $1,800 in 3. Calculate Debt-to-Income Ratio: Divide total interest. monthly debt payments by monthly income. 4. Convert to Percentage: Move the decimal two The 28/36 Rule: Lenders recommend that housing payments places right to get your debt-to-income ratio as a should be no more than 28% of your gross monthly income, percentage. and total debt (including housing and loans) should not exceed 36%. A higher ratio increases financial stress. A debt-to-income ratio of 10% or less is ideal, 10-20% is good, but above 20% signals high Types of Loans: debt, which can make it harder to secure loans or result in higher interest rates. Student Loans: For education, with federal and private options. Net Worth: To calculate your financial health, Mortgage Loans: For buying homes, with varying interest subtract your liabilities (debts) from your assets rates and repayment terms. (things you own). The result is your net worth. Auto Loans: For financing vehicles, available from dealerships, banks, and credit unions. Prioritizing Loans: Personal Loans: Unsecured loans for various purposes, such Debt Snowball Method: Pay off smaller debts first for visible progress as debt consolidation or vacations. and motivation. Debt Avalanche Method: Focus on high-interest debts first to save on Peer-to-Peer Loans: Loans arranged through online interest and pay off loans more efficiently. platforms, often unsecured, but carry higher risks. Getting Out of Debt Consolidating Loans: Combining multiple loans into one can reduce your overall interest and simplify repayment. It Rebuilding Your Finances makes it easier to track debt, and the Consumer Financial Protection Bureau offers guidance on methods for debt 1. Credit Builder Loan: Apply for a short-term loan (usually up consolidation. to $1,000) where the borrowed amount is deposited into an interest-bearing account you can’t access until repaid. Once repaid, the lender reports your positive payment history to credit bureaus. Credit Counseling: Agencies like the National Foundation for Credit Counseling help you manage debt by reviewing your 2. Secured Credit Card: Use a secured card backed by a finances, creating a budget, negotiating with creditors, and deposit, where your credit limit equals your deposit (e.g., planning for future expenses. $500 deposit = $500 limit). Consistently making payments on time can help convert it into an unsecured card, improving your credit score. 3. Authorized User: Become an authorized user on someone Your Rights: The Fair Debt Collection Practices Act protects else’s credit card account. Their positive payment history will you from harassment by creditors, including threats, be added to your credit report, helping boost your score. obscene language, and repeated calls. If violated, file a complaint with the Consumer Financial Protection Bureau. 4. Make Timely Payments: Ensure you make all credit card and loan payments on time. If you’re unable to pay, contact creditors in advance to explain your situation. This shows responsibility and can help maintain trust with creditors. Bankruptcy: As a last resort, bankruptcy can eliminate or reorganize debts under court supervision. It stays on your 5. Create an Emergency Fund: Build an emergency fund with credit report for up to 10 years and can impact future loans. three to six months’ worth of living expenses to cover Chapter 7 involves liquidating nonexempt assets to pay unexpected costs, preventing further debt accumulation. creditors, while Chapter 13 allows you to keep property and 6. Ensure Reporting: Verify that your financial activity is pay over 3-5 years. reported to the three major credit bureaus—Equifax, Experian, and TransUnion—so your efforts to repay debt positively impact your credit score.  Identify Theft Basics How to Prevent Fraud 1.Know Your Rights: You’re not liable for unauthorized purchases on credit and debit cards, as they offer zero-liability guarantees. Credit 1. Practice Safe Internet Use: Keep antivirus software cards also give more time to address fraud compared to debit cards. updated, avoid spam emails requesting personal info, 2. Cash and Prepaid Cards: If cash is stolen, little can be done. and shop only on secure websites (look for “https” and a Prepaid cards, like debit cards, are linked to accounts, so treat them lock symbol). Never share sensitive information via email. like cash and keep them secure. 2. Destroy Private Records: Shred documents containing 3. Protect Your Finances: financial details, such as credit card statements and Check Your Credit Report: Request a free report annually to spot receipts. inaccuracies or fraud. 3. Secure Your Mail: Regularly empty your mailbox, use a Keep Your SSN Private: Only share it with trusted companies, and mailbox lock, and drop payments in secure mailboxes. avoid sending it via email or text. 4. Be Careful with Your SSN: Don’t carry your Social Safeguard Financial Documents: Shred old bills/statements and put Security card with you. Keep it in a safe place and never a hold on mail when on vacation. write it on checks. Smart Online Security: Use strong, unique passwords for different 5. Check Your Credit Report: Review your credit report accounts, change them regularly, and ensure websites are secure annually to spot any suspicious activity. when entering financial information. 6. Be Aware of Scams: Avoid giving out personal information to telemarketers or suspicious emails. Always High Risk for Identity Theft contact the company directly to verify any requests. Elderly individuals are particularly vulnerable to identity theft, with incidents increasing over time. Here are key tips to help protect the Identity Theft Protection Whilst Traveling financial security of children or elderly family members: To protect against identity theft and financial security while traveling, 1. Recognize Warning Signs: Watch for collection calls, bills for consider these key tips: services not used, or IRS notices about misuse of Social Security Numbers (SSNs). The elderly are also prone to phishing scams, both 1. Payments: Use travel pouches to secure your wallet and prevent online and over the phone. accidental loss. When paying at restaurants, sign receipts and hand them directly back to the server. Keep a copy of receipts and store checkbooks 2. Check Credit Reports: Monitor credit reports annually for unusual in a locked safe at home. activity, especially if the individual is over 14 years old. You can request a free report once every 12 months from the three major credit 2. Technology: Secure your smartphone with complex passwords, disable bureaus. Bluetooth, and install tracking apps. Avoid public Wi-Fi for sensitive transactions and clear your browser history and cookies after use. Never 3. Be Careful with Personal Information: Only share SSNs when save passwords or autofill on public computers. absolutely necessary and ensure the request comes from a reputable institution. Remind elderly relatives to avoid giving out their SSN over 3. Preparing to Travel: Before traveling, secure valuable information at the phone or by mail. home, put your mail on hold, and ensure your luggage doesn’t contain financial details. On flights, avoid letting others see your card information. 4. Monitor Online Activity: Educate family members, especially the Never carry your Social Security Number. Once at your destination, lock elderly and children, on online security. Be cautious of phishing emails, up valuables, including documents, in a hotel safe. avoid sharing personal info, and only shop on secure websites. 5. Store Important Documents Safely: Keep financial and personal records in a secure place. Regularly check the mailbox, shred By combining these practices, you can create a strong safety net for your unnecessary documents, and ensure all important information is privacy and financial security while traveling. Tools to protect your identity protected. These steps can help safeguard against identity theft and protect the financial well-being of loved ones. If you fall victim to identity theft, follow these steps to report and recover: 1. Report to Law Enforcement: Contact your local police department, and if the theft occurred elsewhere, report it to the relevant law enforcement agency. Request an identity theft report and keep a copy. 2. Contact Credit Reporting Companies: Notify the fraud departments of the major credit bureaus (Equifax, Experian, and TransUnion). Request a fraud alert on your file and consider a security freeze to prevent new credit from being issued in your name. 3. File a Fraud Report: Report the theft to the Federal Trade Commission (FTC) through their website or hotline. They won’t investigate but will share your information with nationwide investigators. 4. Create a Fraud Recovery Plan: The FTC offers a personalized recovery plan, allowing you to track your progress and manage the steps to recover from identity theft. Visit identitytheft.gov for more resources.  Going to College Buying a Car Higher education is a crucial investment, offering better employment opportunities. For example, in 2012, millennials with a bachelor’s degree had a much lower unemployment rate (3.8%) compared to those with just a high school diploma (12.2%), according to Pew Research. However, the costs can be steep, ranging from $15,640 at public institutions to $40,614 at private universities per year. Despite the high cost, a degree can yield an average lifetime earning of $1 million more than a high school diploma. Yet, student debt remains a significant burden. As of 2015, U.S. student debt reached $1.3 trillion, with the average loan debt for 2016 graduates at $37,172. Deciding on the type of post-secondary education is crucial and depends on individual goals. Types of Post-Secondary Institutions: 1. Trade Schools: Focus on specific skills for hands-on careers, ideal for those looking to start working quickly after high school. 2. Two-Year Colleges: Offer affordable college-level courses, with the option to transfer to a four-year university for a bachelor’s degree. 3. Four-Year Colleges: Provide a broader education and higher degrees but come with significantly higher costs, especially for out-of-state students. College Preparations: High School Transcript: AP courses can save money by providing college credits if students pass the exams. Standardized Tests: SAT and ACT scores are still important for many colleges and can influence scholarships. Many schools have begun to move away from requiring these scores, but it’s important to check specific requirements. Tips for College Prep: Consider prep courses and retaking exams for better scores. Many high schools offer college counselors to help with the application process. Overall, choosing the right path for higher education involves balancing costs, career goals, and educational opportunities.  Renting a Apartment Buying a Home Cosigning If you have no credit When buying a home, consider history or have only just started the following: working, a landlord may not be 1. Down Payments: Typically at least 3% of convinced that you are able to the home’s price, with 20% down avoiding make your rent payments. You private mortgage insurance (PMI). may be required to get a cosigner, 2. Mortgage Payments: Monthly payments or guarantor - someone who will may be similar to rent, but you’ll also pay for taxes, insurance, repairs, and utilities. share financial responsibility for the lease. If for some reason you 3. Leasing a Home: Leasing offers flexibility for specific timeframes (6-12 are unable to make the payments, months), with stricter terms than rental the cosigner will be responsible for agreements. making the payments. Breaking a 4. Renting vs. Buying: Renting involves Lease Avoid breaking a lease fewer responsibilities but no long-term investment. Buying requires more upfront (moving out before the end of the costs and ongoing maintenance but can be agreed-on term) if at all possible a good investment in the long run. Each lease agreement has its own penalties for breaking the terms If you must break a lease, some Your choice should depend on your financial goals and market conditions. landlords require paying a fee, working with the property management company to find new renters, subletting the apartment or conting to pay rent until the apartment is re-rented.  Landing a Job Health Care The hiring process can vary by industry, but typically involves multiple rounds of interviews, Health insurance plans are including phone or video calls, followed by in- person meetings. To prepare, ask the hiring categorized into four tiers— manager about their specific process. bronze, silver, gold, and platinum —based on pricing and coverage In your profession, it’s important to stay updated levels. Insurers must provide plan on the skills, experiences, or credentials valued details, including deductibles and by employers. Technical proficiency and coverage rules, to help consumers continued learning through courses or internships can help you stand out. compare options. They cannot deny coverage or set premiums based on gender or pre-existing Consider the work-life balance you want when conditions. Young adults can stay evaluating job opportunities. Think about flexibility, work hours, and remote options before on their parents’ plan until age 26. making a decision. Despite the Affordable Care Act’s reforms, health care costs remain Before relocating for a job, weigh the costs of high. To choose the best plan, it’s moving and living expenses. If the job involves crucial to understand all available travel, make sure it aligns with your preferences. options based on your medical and financial needs. When looking for a job, think about the growth opportunities it offers. Some employers provide development training or financial support for further education. For students, career centers are great resources to find job opportunities and attend career fairs. Alumni can also provide valuable insights and networking opportunities, and many schools offer exclusive job boards or connections with companies.  Family Life Elder Care Planning for family life requires careful financial consideration and preparation. When planning for long-term care, Here are key factors to think about: whether for yourself or a relative, 1. Financial Planning: Meeting with a it’s crucial to understand your financial planner can help you and your options and the financial impact. partner set shared financial goals and Long-term care can focus on create a budget. Understand each other’s medical procedures or managing financial history before marriage, as joint pain and comfort, but it can be finances will impact both of you. expensive and affect your family’s 2. Taxes: Once married, you can choose to finances. file taxes jointly or separately. Filing jointly often offers benefits, but consulting a tax professional is advisable to make the best decision. Care options include assisted living 3. Bank Accounts: Decide whether to keep facilities, nursing homes, home separate or joint bank accounts. Some health aides, and adult day care. couples combine finances while others Costs vary by region and service maintain individual accounts and contribute type. Prioritize your health, to shared bills. emotional well-being, and financial situation when considering care, 4. Credit Cards: Each person should maintain at least one credit card in their own and explore available funding name to build a separate credit history. This options to ensure you’re prepared. helps with future financial needs like mortgages or loans. 5. Debt: Address any significant debt as a priority. Create a plan to pay it off quickly to free up resources for other financial goals. 6. Retirement: Plan for a comfortable retirement by ensuring you both contribute sufficiently to retirement funds. Consider your long-term needs, especially as people live longer. By carefully managing these financial areas, you can secure a stable and prosperous future for your family.  Retirement Handling the Unexpected Starting to save for retirement early is key to ensuring a comfortable future, Unexpected expenses, such as job especially as people live longer. For loss, car repairs, or home issues, example, women born in 2019 are can disrupt your budget. To prepare expected to live to around 81, and men for these, aim to set aside 10-15% to 76. of your monthly income into a checking or savings account automatically. Over time, adjust this If you begin saving early, you can take percentage as you get a clearer on riskier investments since you have picture of your spending. time to recover from potential losses. Key retirement savings options include 401(k) plans, Individual Retirement Accounts (IRAs), annuities, and health savings accounts (HSAs). Using It’s also wise to build an emergency retirement calculators can help you fund with three to six months’ worth assess your current situation and of living expenses. Make it part of estimate your future savings. your monthly budget, even if you start with small amounts. Unlike retirement savings, emergency As retirement approaches, it’s funds should be easily accessible, important to evaluate your financial so keep them in a savings account standing. If you’re behind on savings or or money market fund. While you carrying debt, consider adjusting your hope never to use it, having this budget to save more. While retirement planning isn’t guaranteed, taking safety net will provide peace of proactive steps can significantly mind when unexpected costs arise. improve your financial outlook.  Making Purchases online Selling Online When shopping online, security is key. Ensure the retailer has strong security measures to protect your personal information. Selling online can be a great way to make extra money, whether it’s used Layaway items, new goods, or services. Online layaway programs allow you to pay for items gradually, avoiding large upfront costs and interest Used Goods: Ensure items are in fees if used correctly. However, be aware of hidden fees and the impact of missed payments on your good condition and decide whether to credit. sell locally (for large items) or ship. Choose reputable platforms, take Installment Payments or Buy Now, Pay Later quality photos, and price items based These programs let you receive items immediately on their condition and market value. but pay in installments. Some may charge interest, Be aware that marketplaces usually while others are interest-free, so always check the terms carefully. take a percentage of the sale. Subscriptions New Goods: For handmade or Subscriptions offer convenience by allowing refurbished items, craft marketplaces automatic payments for products or services you use are ideal. Provide clear product regularly. Be cautious not to keep paying for unused descriptions with details like size, subscriptions, and remember to cancel free trials before they turn into paid ones. Online tools can help color, and shipping time. you manage and track your subscriptions. Services: If offering a service, Autopay, like subscriptions, is a convenient way to ensure that your important bills are paid on time, create a detailed profile with helping you avoid late fees and interest charges. experience and past projects. Ensure However, it’s important to monitor your bank account clear communication about to prevent surprises. Automatic payments can availability and timelines, and aim for sometimes take out larger sums than expected, leaving you with less money for other expenses. positive ratings. Additionally, if your account balance is low or negative, you might incur overdraft fees. To use In all cases, use secure platforms, autopay wisely, keep track of the amounts being provide honest descriptions, and withdrawn and ensure your account has enough funds deliver excellent customer service to to cover them. succeed in online selling.  Digital payments methods Security online Paying with a Card Identity Theft Debit, credit, and prepaid cards can be used Identity theft happens when someone steals your both online and in person. Online, you enter your personal or financial information to commit fraud, card details (card number, expiration date, such as making unauthorized purchases or opening security code, etc.). In-person, you can swipe accounts in your name. You may not realize your (magnetic strip), insert (microchip), or tap identity has been stolen until you notice unusual (contactless payment). Microchips are more account activity, missing bills, or a significant drop secure and faster than magnetic strips. Some in your credit score. cards also offer tap-to-pay functionality via NFC (Near Field Communication) for quicker, hygienic transactions. Gift Cards Third-party auction sites selling gift cards may Paying through Digital Devices seem like bargains, but they can be fraudulent, especially if the cards have a zero balance. Mobile wallets, like those on phones or smartwatches, let you store card information and tap to pay. QR codes are another option where you scan a code to input payment details, though Phishing Schemes not all retailers accept these methods. Scammers may send fake emails or texts that look legitimate, often claiming to be from companies you know. These messages ask for sensitive personal Making Person-to-Person Payments information, like your address, ID number, or credit card details. Online money transfer tools allow you to send and receive money from friends or family without cash. Be mindful of service fees and security risks, and ensure your account has a strong, Ransomware unique password. Ransomware is a type of malware that locks your files until you pay a ransom. Scammers may threaten to release sensitive information unless you Super Apps comply. A super app combines multiple functions—such as social media, e-commerce, and bill payment— into one platform, streamlining access to various Tips to Protect Yourself Online services. 1. Use strong passwords for online accounts. 2. Limit how much personal info you store online. Mobile Money 3. Research new businesses by reading Mobile money allows you to store and transfer online reviews. funds linked to your phone number, providing access to your balance via your mobile 4. Only shop on secure websites (look for “https” provider’s network, making it easy to send or and a lock icon). receive money on the go. 5. Be cautious of phishing scams and monitor bank statements for unauthorized transactions. 6. Ask why your ID number is needed and how it will be protected.