17As Jesus went out into the street, a man came running up, greeted him with great reverence, and asked, "Good Teacher, what must I do to get eternal life?"

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• 17As Jesus went out into the street, a man came
  running up, greeted him with great reverence, and
  asked, "Good Teacher, what must I do to get
  eternal life?"  18-19Jesus said, "Why are you
  calling me good? No one is good, only God. You
  know the commandments Don't murder, don't commit
  adultery, don't steal, don't lie, don't cheat,
  honor your father and mother."

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• 20He said, "Teacher, I havefrom my youthkept
  them all!"
•  21Jesus looked him hard in the eyeand loved
  him! He said, "There's one thing left Go sell
  whatever you own and give it to the poor. All
  your wealth will then be heavenly wealth. And
  come follow me."

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• 22The man's face clouded over. This was the last
  thing he expected to hear, and he walked off with
  a heavy heart. He was holding on tight to a lot
  of things, and not about to let go.
• Mark 1017-22 MSG

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Amoral lacking or without morals holds no
moral implications
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PART ISaving Spending

• Is it worth having a job in college?
• How much money should I save vs. spend?
• What is the difference between a checking and
  savings account?
• How much money should I put in savings each month?

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Two Kinds of People
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Which Account Should I Take?

• CHECKING
• Primarily used for spending
• Connected with debit card/checks
• Sometimes requires low minimum balance/stipulation
  s
• Easy to withdraw money

• SAVINGS
• Primarily used for saving
• Typically used only to deposit money
• Sometimes requires a high minimum balance

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72 of All Statistics Are Made Up

• The Average American has 3800 in savings
• The US has a -0.6 savings rate
• 41 of Americans say they live paycheck-to-paychec
  k

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Saving is about

• Emotion ? people start saving money when its
  important to them
• Contentment ? people start saving money when they
  dont have to impress others to feel good about
  themselves

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What if you started saving now?

• 1 day
• 7 week
• 30 month
• 360 year
• In 40 years youd have
• 14,400

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What if you started saving now?

• 4 one pack per day
• 28 week
• 112 month
• 1460 year
• In 40 years youd have
• 58,400

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What if you started saving now?

• 5 cup per day
• 35 week
• 140 month
• 1680 year
• In 40 years youd have
• 67,200

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Its almost dumb to say

• If you want money, dont spend money
• Dont spend money that you dont have
• Be a saver, not a spender

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Reasons to Save

1. Emergencies
2. Purchases
3. Wealth Building

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Emergencies

• Save at least 10 of income each month
• 1000 in an emergency fund
• NOT for purchases
• NOT for investing
• Only used for emergencies
• Full emergency fund is 6 - 8 months expenses

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Purchases

• Always use cash for purchases
• Using a debit card is the same as using cash
• Never use credit, but if you do, make sure it is
  for something that is still around when you pay
  the bill.

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Purchases

• Lump sum saving
• 299 iPhone 4 32 GB
• 24.91 month for 12 months
• 299 _at_ 7.25
• 41.24 work hours
• about 2 work weeks (part time)

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Wealth Building

• There is no such thing as a get rich quick scheme
• Taking small steps in the right direction over
  time
• Live Like No One Else

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PART IIBudgeting 101

1. Should I hire someone to do my budget and my
   taxes or should I do that myself?
2. How do you go about making a budget but still
   have money left over to go out in college?
3. How should you start saving money to buy a house
   before or after college?

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• Is there anyone here who, planning to build a
  new house, doesnt first sit down and figure the
  cost so youll know if you can complete it? If
  you only get the foundation laid and then run out
  of money, youre going to look pretty foolish.
  Everyone passing by will poke fun at you He
  started something he couldnt finish.
• Luke 1428-30 MSG

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A budget is an estimate of revenue and expenses
over a certain amount of time.
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Choose

• BE REACTIVE
• Taking action after a choice is made.
• Reacting to a situation rather than planning for
  it.

• BE PROACTIVE
• Taking action before a choice is made.
• Anticipating a situation rather than reacting to
  it.

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People dont like to budget because

• It has a negative connotation.
• It has been used to control them.
• Theyve never had a budget that works.

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A written budget will

• Eliminate unnecessary spending.
• Motivate you to save more.

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The Envelope System
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Zero-Based Budget System

• Allocate every single dollar on paper before the
  month begins.
• Allows for you to plan ahead with your money.
• Helps forge discipline in your spending.
• Creates a standard to live by.

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Zero-Based Budget System

• List Prioritize your expenses
• If you could only spend money on one thing, what
  would it be?
• Allocate every single dollar (zero-based) to your
  expenses based on priority.
• Include savings and outstanding debt.
• Know exactly where every single dollar is going.

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your assignment scenario

• You are going off to college and will be making a
  budget that you will follow your first year.
• Your income will be based on
• Your current part time job
• A part time job you find at your college
• A part time job paid at minimum wage (dont
  include taxes)
• Your budget will be on a zero-based system.

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your assignment assumptions

• We will assume you have
• 2000 in savings from your summer job
• No outstanding debt.
• No car payment.
• Received a scholarship for tuition and books
• Chosen to live in an apartment off-campus

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your assignment specifics

• Zero-based budget.
• Short essays, photos, and citations describing
  your purchases for each category (1 paragraph
  maximum).
• Use real prices and information that you find.
• Final grade is based on assigned rubric.

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your assignment due dates

• This project is due Monday, May 2nd
• 10 deduction for each day late after that.
• No late budgets accept after Thurs, May 4th

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PART IIILoans Big Purchases

1. Is it worth paying 50,000 a year to go to
   college?
2. What are the advantages/disadvantages of only
   having a debit card an no credit card?
3. Is credit important? How do you get credit?
4. How should I deal with paying off my college debt?

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• The rich rule over the poor, and the borrower
  is slave to the lender.
• Proverbs 227 NIV

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MYTH If I lend a friend money, I will be helping
them out.
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TRUTH The relationship will be strained or
broken.
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Interested?

• Principal ? the amount you borrow
• Interest Rate ? percentage charged by bank on
  principal
• Based on past credit history, income, and credit
  score
• Term ? length of time you will pay back loan
  (typically in months)
• Ex 1,000 loan _at_ 10 interest for 60 months
• 18.33 month
• 1100 over course of loan

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• Credit score is an arbitrary number created by
  credit card companies to assign interest rates
  and has little or no real bearing on your life.

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2011 Audi A4 2.0T 35,375
2001 Audi A4 1.8T 5,500
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• NEW CAR
• 35,375 _at_ 1.9 for 60 mos.
• 618.50 / month
• 37,110 real cost
• PRO New car!, few repairs
• CON More expensive, fast depreciation

• USED CAR
• 5500 _at_ 6.9 for 24 mos.
• 247.50 / month
• 5,940 real cost
• PRO more affordable,
• CON Older model, harder to find a good deal

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• Save 600/month for 10 months 6000
• Purchase 2001 Audi for 5500
• Drive used Audi for 2 years, save 600/month
• 14,400
• Resell at 15 depreciation
• 5500 - 825 4675
• Use 15,225 to buy new car

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2004 Audi TT 15,200 used
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Helpful Tips

• Good questions to ask
• Has the car been in any major accidents?
• Have the owner had the car its entire life?
• Has the car been garaged?
• Is the owner a smoker?
• Has the car been driven in extreme winter
  weather?
• Other tips
• When buying used, you will have to compromise
• Always negotiate the price
• Shop around for a lower interest rate

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What if you dont pay?

• Property can be seized relative to loans value.
• Higher interest rates and less chance of
  receiving loans in the future.

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PART IVInvesting

1. Should I get involved with the stock market?
2. What is the most beneficial investment I can make
   during my college years?
3. What is the smartest way to distribute your
   income?
4. What mutual funds should I invest in?

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 14-18The Kingdom of God is like a man going off
on an extended trip. He called his servants
together and delegated responsibilities. To one
he gave five thousand dollars, to another two
thousand, to a third one thousand, depending on
their abilities. Then he left. Right off, the
first servant went to work and doubled his
master's investment. The second did the same. But
the man with the single thousand dug a hole and
carefully buried his master's money.
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 19-21After a long absence, the master of those
three servants came back and settled up with
them. The one given five thousand dollars showed
him how he had doubled his investment. His master
commended him 'Good work! You did your job well.
From now on be my partner.'
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 22-23The servant with the two thousand showed
how he also had doubled his master's investment.
His master commended him 'Good work! You did
your job well. From now on be my partner.'
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 24-25The servant given one thousand said,
'Master, I know you have high standards and hate
careless ways, that you demand the best and make
no allowances for error. I was afraid I might
disappoint you, so I found a good hiding place
and secured your money. Here it is, safe and
sound down to the last cent.'
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 26-27The master was furious. 'That's a terrible
way to live! It's criminal to live cautiously
like that! If you knew I was after the best, why
did you do less than the least? The least you
could have done would have been to invest the sum
with the bankers, where at least I would have
gotten a little interest.
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 28-30'Take the thousand and give it to the one
who risked the most. And get rid of this
"play-it-safe" who won't go out on a limb. Throw
him out into utter darkness.Matthew 2514-30
MSG
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Investing is long-term growth your money
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Only invest when

• You have enough money saved for an emergency
• Your car is paid off
• Your student loans are paid off
• Investing is the secondary action of living
  within your means

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Diversification lowers risk.- as risk
increases, return increases- as risk decreases,
return decreases- you need to make 6 to break
even
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Liquidity is the availability of your money.-
more liquidity means less return- less liquidity
means more return
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CD/Savings Account

• Low-risk, highly liquid, low return investment
• Best savings accounts average 1 return

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Money Market Account

• Low risk, highly liquid, low return investment
• Include check writing privileges
• Typically higher interest rates than savings
  account
• Require higher minimum balance than savings
  account
• Average 3-4 return on money

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Stocks

• High risk, highly liquid, medium return
  investment
• Stocks are pieces of ownership in a company
• When a company is more valuable, the stock is
  worth more
• If a company is profitable, it may choose to pay
  out a dividend
• Average 7 return

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Bonds

• A bond is a debt instrument for a country sold to
  investors
• Money is used to build the company
• Bonds are paid out at a due date and earn
  interest over time
• Average 8 return

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Mutual Funds

• Mid risk, low liquidity, mid return investments
• Investors mutually fund an account that is
  controlled by a fund manager
• Mutually funds can consist of hundreds of pieces
  of stock in many different companies and are
  branded
• Average 12 return long term

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PART VThe Future

1. How can I ensure that Im not broke when I
   retire?
2. What type of yearly salary should I strive for
   right out of college?
3. How much more marketable to employers will
   internships make me?
4. Should I focus on studying or working?
5. Should you save money after you retire?
6. How do you (economically) pick a wife?
7. If your parents pay for everything while youre
   in college is it going to be harder to support
   yourself later on in life?

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25The generous will prosper      those who
refresh others will themselves be refreshed.
Proverbs 1125 NIV
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In physics, a lever (from French lever, "to
raise) is a rigid object that is used with an
appropriate fulcrum or pivot point to either
multiply the mechanical force (effort) that can
be applied to another object or resistance force
(load), or multiply the distance and speed at
which the opposite end of the rigid object
travels.
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17 Every good and perfect gift is from above,
coming down from the Father of the heavenly
lights, who does not change like shifting
shadows. James 117 NIV
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• 2.5
• 10
• 15
• 27
• 90

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11 The wealth of the rich is their fortified
city they imagine it a wall too high to scale.
Proverbs 1811 NIV
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 6 Surely everyone goes around like a mere
phantom    in vain they rush about, heaping up
wealth    without knowing whose it will finally
be. Psalm 396 NIV
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38 As he taught, Jesus said, Watch out for the
teachers of the law. They like to walk around in
flowing robes and be greeted with respect in the
marketplaces, 39 and have the most important
seats in the synagogues and the places of honor
at banquets. 40 They devour widows houses and
for a show make lengthy prayers. These men will
be punished most severely.
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41 Jesus sat down opposite the place where the
offerings were put and watched the crowd putting
their money into the temple treasury. Many rich
people threw in large amounts. 42 But a poor
widow came and put in two very small copper
coins, worth only a few cents.
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43 Calling his disciples to him, Jesus said,
Truly I tell you, this poor widow has put more
into the treasury than all the others. 44 They
all gave out of their wealth but she, out of her
poverty, put in everythingall she had to live
on. Mark 1241-44 NIV
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An Economic Conundrum

• There are 100 hungry people
• There are 100 hamburgers
• What do we do with the 100 hamburgers?

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• 1 person takes 40 hamburgers
• 2 people take 25 hamburgers
• 4 people take 12 hamburgers
• 43 people take 22 hamburgers
• 50 people get 1 hamburger

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8-11"Begin by being honest. Do honest people rob
God? But you rob me day after day. "You ask,
'How have we robbed you?' "The tithe and the
offeringthat's how! And now you're under a curse
the whole lot of youbecause you're robbing me.
Bring your full tithe to the Temple treasury so
there will be ample provisions in my Temple. Test
me in this and see if I don't open up heaven
itself to you and pour out blessings beyond your
wildest dreams.Malachi 38-10 MSG