Financial literacy
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Financial literacy presentation created by the Indiana State Library
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Financial literacy
- 1. Professional Development Office Indiana State Library
- 2. National Financial Educators Council (NFEC) It is “possessing the skills and knowledge on financial matters to confidently take effective action that best fulfills an individual's personal, family and global community goals.”
- 3. Financial literacy has become a vital issue to our country. America is currently in dire straits because of the bad financial habits of our government and our citizens. We need to return to the values of financial responsibility that were practiced by our forefathers. These values -- thrift, accountability, work ethic -are what made our country wealthy in the first place and if we don't return to them we will only continue to decline and go deeper in debt.
- 4. ◦Money management ◦Credit ◦Loans and debt ◦Identity theft
- 5. ◦ It’s never too early or too late to start understanding money! ◦ Librarians/library staff need this info! ◦ Customize your materials to the group. Children/Young Adults Adults/Retirees ◦ Know your community needs and find resources/organizations to whom you can refer patrons.
- 6. Budget Determine monthly bills Rent Utilities Insurance – auto, medical, vet Resources available: mint.com, Microsoft Excel, themint.org, Quicken http://money.cnn.com/magazines/mon eymag/money101/lesson2/index.htm
- 7. List down other expenses Food Fuel Entertainment Clothes Credit cards Loans Unexpected and upcoming expenses Create your own saving plan for short term expenses, retirement, and rainy day fund.
- 8. How much do you make? Total all your expenses. -Spreadsheet -Check register
- 10. Safe places to keep your money. Checking Savings Loans – home, auto http://www.allbanks.org/top_banks.html
- 11. Open checking account at the bank Convenient -ATM Treat it like cash Track your expenses
- 12. Protect your debit card ◦ Keep PIN safe/private ◦ Report loss immediately ◦ Unauthorized purchases ◦ Avoid using it to purchase online Know the policies of your bank – fees http://www.consumer.ftc.gov/articles /0213-lost-or-stolen-credit-atmand-debit-cards
- 13. Debit vs. Credit pre-paid Terms & Fees Keep track of your expenses Good for improving credit. . .if payments are made on time! http://www.prepaidcards. org/
- 14. Compare prices Favorite stores ◦ Good: Frequent shopper key fobs ◦ Avoid: Retail credit cards Coupons ◦ Example: coupons.com Sale (seasonal) ◦ Buy winter clothes during the summer! Bulk vs. retail *Ask yourself: Is it a want or a need?
- 15. A credit report contains information on where you work and live, how you pay your bills, and whether you’ve been sued or arrested or have filed for bankruptcy. Credit reporting agencies (CRAs) gather this information and sell it to creditors, employers, insurers, and others.
- 16. Equifax: 1-800-685-1111 or www.equifax.com Experian: 1-888-397-3742 or www.experian.com TransUnion: 1-877-322-8228 or www.transunion.co http://www.consumer.ftc.gov/articles/0155free-credit-reports
- 17. Pay your bills on time. Keep balances low on credit cards and other “revolving credit.” Apply for and open new credit accounts only as needed. Pay off debt instead of moving it around. Owing the same amount, but having fewer open accounts, may lower your score.
- 18. Compare several credit cards Annual fees Low APR (Annual Percentage Rate) Fine fine lines! http://banktruth.org/rates-2012/
- 19. Use it wisely Few times in a month Do not over-spend Pay whole bill every month. Pay on time. Cash advances!
- 20. Car loans ◦ ◦ ◦ ◦ Lease APR Terms Used car vs. brand new Associated fees: Registration, Insurance
- 21. RESEARCH, RESEARCH , RESEARCH •Terms •Fixed Rate vs. Variable Rate •Adjustable Rate Mortgage (ARMs)
- 22. U.S. Department of Education’s website, www.studentaid.ed.gov, provides information on preparing for and funding education beyond high school with details on the federal aid programs. Another source of information on financial assistance is www.finaid.org 529 plans and the plans available in each state, visit www.collegesavings.org
- 24. ◦ Keep financial records safe ◦ Purchase a shredder ◦ Get your mail as soon as possible Choose email option if possible ◦ Guard your SSN ◦ Phishing – spam mail ◦ Passwords – special characters, numbers, upper cases ◦ CAPTCHA
- 25. Retirement accounts http://www.irs.gov/Retirement-Plans/PlanSponsor/Types-of-Retirement-Plans-1 Investment options Insurance ◦ Health Savings Accounts ◦ Auto ◦ Use a retirement calculator ◦ http://www.aarp.org/work/retirementplanning/retirement_calculator.html
- 26. Credit Reporting Companies ◦ Equifax (1-800-525-6285) ◦ Experian (1-888-397-3742) ◦ Transunion (1-800-680-7289) Federal Trade Commission (1-877-438-4338) Police Agency Financial Counselor
- 27. Publications.USA.gov ◦ http://publications.usa.gov/USAPubs.php?NavCode =C National Financial Educators Council ◦ http://www.financialeducatorscouncil.org/ U.S. Department of Treasury ◦ http://www.treasury.gov/resourcecenter/financial-education/Pages/commissionindex.aspx
- 28. Federal Trade Commission ◦ http://www.ftc.gov/bcp/consumer.shtm Mymoney.gov ◦ http://www.mymoney.gov/index.html Consumer Action Handbook Public Library Association Financial Literacy Handbook ◦ http://www.ala.org/pla/tools/financiallit
Editor's Notes
- The US government established financial literacy to educate the people how to manage their money effectively. We are experiencing economic crisis, and there is no better time to educate ourselves with finances than now. Although April is the month of Financial Literacy, this does not mean that we have to postpone educating the people about financial management. This should be done regularly, and as librarians, we provide information to our patrons and eventually assist them in making their decisions.
- National Financial Educators Council cannot emphasize the importance of educating the public. There is economic crisis all over the country and the United States should take lead in solving this matter, but only and only if we as citizens should do our part.
- When presenting financial literacy, programs should be designed depending on the audience. Children will be interested if there are activities involved that are suitable for them. Incorporating games, for example, will keep the children more involved. If your budget permits, some form of incentive can boost attendance and involvement. Tweens and young adults prefer to have a sense of control of their environment. Therefore, designing a program that involves them from planning to evaluating the event will have more positive outcomes.Researching about the lifestyle of your community is important. This is EXACTLY where you should start. Creating a program that is no way relevant to patrons will be perceived as a waste of time. And that is not our goal in this project.
- According to CNN Money, budget is a “necessary evil”. The only way to effectively manage your income is to have a clear cut budget. There are resources out there that can assist you in tracking your income and expenses. Software such as Microsoft Excel, Quicken will make things easier. For us who are not yet comfortable using electronic resources (software), sometimes investing with them has more advantages than we will ever know. There are websites available out there.This is the hyperlink for CNN Money and it has a lot of information about financial literacy.http://money.cnn.com/magazines/moneymag/money101/lesson2/index.htm
- This is when utilization of software is very beneficial. Some software can be expensive at first glance, but weigh in the advantages of having one. Will spending $50 for a software save my sanity?Utilize a system that works for you. If you are comfortable using something simple as a check register, go ahead. You have several options; you just need to look at them closely and determine whether they are applicable to your situation.
- Storing your money under your mattress is not the best idea even though your great grandparents told you that it is the safest place in the world.It is important to compare banks. The hyperlink above shows you information about banks in the country. Do your own research.
- Most banks offer debit cards when you open an account with them. Make sure that there are “no strings attached” when you sign up. Remember that banks compete for customers, so you have the hand in deciding what is good for you. Beware of “promotions”.
- In case that you lost your debit card, you must contact your bank immediately. The Federal Trade Commission’s site enumerates the steps you need to take when this unfortunate event happens.
- You can always ask your bank for prepaid cards. Most banks offer this service. Compare prepaid cards and choose what is the best for you.
- Our credit history is important in our daily lives. Prospective employers sometimes check our credit worthiness especially if those jobs involve finances or even national security.
- Check your report at least once a year. You are entitled to one free credit report through annualcreditreport.com. Check every item. If you found a discrepancy, report it immediately to the agency.
- Check your banks. This is the website that can give you some information about the rates being offered by banks.
- Fixed rate vs. variable rate: A variable interest rate loan is a loan in which the interest rate charged on the outstanding balance varies as market interest rates change. As a result, your payments will vary as well (as long as your payments are blended with principal and interest). Fixed interest rate loans are loans in which the interest rate charged on the loan will remain fixed for that loan's entire term, no matter what market interest
- Don't be afraid to ask—it could save you from ultimately paying more than necessary for your student loans.Check the Department of Education about their student debt policy and tips how to pay off your debts. There are still talks about student loan interest rates increasing which will burden most students. Whether you have children who are in college or going to college, make sure you keep in tune with current events.
- Identity theft is : ”the crime to include an intent to use another's identity to commit, aid, or abet any unlawful activity” -- http://definitions.uslegal.com/i/identity-theft/
- This goes back to Credit Reports. Check your bank statements and credit reports.
- Consult a financial advisor or human resources and inquire about your retirement plans.The AARP is a good resource for retirements and investments for seniors.