Welcome to Your Financial Fitness Checkup

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Welcome to YourFinancial Fitness Checkup
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Todays Goal

• To provide you with a few basic concepts and
  tools to improve your financial fitness.

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Topics Covered

• Overview of average debt.
• Do you know your debts.
• Avoid credit card tricks.
• Getting out of debt.
• Maximize your savings.
• Building a money reserve.
• Investing for a financially sound future.

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Average Credit Card Debt

• 1,363

Average Household Debt
8,940
Average Auto Loan Debt (New)
21,779
Average Auto Loan Debt (Used)
16,542
Average Mortgage Loan Debt
202,600
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The national savings rate fell from 8.7 percent
in 1992 to only 2.3 in 2003.
In 2003, a record 1.65 million people filed for
bankruptcy.
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List of Debts Form
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What Credit Cards Really Cost

• Interest.
• Balance Rate Payment.
• 5,000 21 2.5 (125)

Length Interest Total 33 yr. 9 mo. 11,027 16,027
5,000 21 150
4 yr. 3 mo. 2,569 7,569
5,000 15 2.5 (125)
21 yr. 5 mo. 4,757 9,757
5,000 15 150
3 yr. 8 mo. 2,388 7,388
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Examples of Credit Card Trickery

• Fees for paying off monthly balance accumulating
  no interest over a year.
• Shortening grace periods (1990 29.7 days, today
  21.1 days)
• Paying late triggers higher rates plus late fee.
• Higher rates if card not used.
• Higher cash advance rates.
• Over limit fees plus higher rates.
• Method of interest calculation - 30 day cycle/60
  day cycle.

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Take the Rebate and Save
2,000 2,000 0 2,000 18,000 16,000
60 months 60 months 2.9 5.75 323 307
19,380 18,420 Amt. Saved 960
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Easy Credit
Pay Day Loans
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How do I get out of debt?

• Tighten the Budget - Spend Less
• Impulse Buying
• Examine Your Expenses - Shop Around
• Cut the Cards - Reduce Temptation
• Refinance
• Carry Less Cash
• Track ATM Withdrawals
• Pay Off High Interest Bills
• Stack Your Payments
• Debt Consolidation

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Income Expenses

• Budgeting / Financial Planning
• Needs vs. Wants

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• PYF! (Pay Yourself First)
• You wont spend it if you dont see it!
• Save 1/2 of all raises!

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Develop a Goal Statement
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Goal Worksheet
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How much do you need to feel financially secure?
500,000
15 23 30 32
1,000,000
2,000,000
More than 3,000,000
Recent Poll on CNNMoney
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Net Worth Worksheet
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(No Transcript)
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Value of Time
20 year-old

• Amount Rate Time Total
• 100/mo 8 10 yr. 18,515.96

8 35 yrs. 273,764.84
100/mo 8 45 yr. 531,069.38
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Value of Time
450/mo 8 35 yr. 1,039,578.62
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Value of Time
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Investing
Junk Bonds Collectibles Growth Mutual Funds Blue
Chip Stocks Balanced Mutual Fund US Treasury
Bills Bonds Certificates of Deposit Insured
Bank Savings
Potential Return
Risk
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Financial Fitness Summary

• Dont be afraid
• Be consistent
• Examine
• Plan
• Start Now

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Comments Questions
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Thank You for Attending the Financial Fitness
Checkup