Name Class Period - Teen Living

[Pages:3]Name__________________________________________________ Class Period___________

DAVE RAMSEY NOTES SAVINGS VIDEO NOTES

1. _____Savings____________________ must become a priority. Always pay______Yourself__________ first. What does it mean to pay yourself first? Put money into savings before you spend your discretionary income

2. The United States has a ________negative__________________ savings rate. 3. Savings money is about _______emotion____________________ and _______contentment_______________. 4. You should save money for three basic reasons.

Emergency Fund Purchases Wealth Building 5. ______Emergencies_____________ are going to happen. Count on it! A beginner emergency fund, is ________$1000______________ in the bank. Why do teenagers need an emergency fund? Lock keys in car or your car breaks down How much money should a teenager put in an emergency fund?_________$500________________ A fully funded emergency funds is _____3-6_____________ months of expenses.

6. A great place to keep your emergency fund is in a ____money___market_____ account from a mutual fund company. Your emergency fund is not an ______investment___________, it is insurance. The emergency fund is your ________first____________ priority. Do it quickly!!

7. The second thing you save money for is ______purchases_______________. Instead of ____borrowing_______ money to make a purchase, pay cash buy using a ______sinking fund approach__.

8. The third thing you save money for is _____wealth__building______ is a key ingredient when it comes to building wealth. Building wealth is a ______marathon________________, not a sprint

9. Pre-________authorized_ checking_______________ withdrawals are a good way to build in discipline because it make saving automatic.

10. _Compound Interest_______________________ is a mathematical explosion. You must start_____NOW_______. Define Compound Interest. Earning interest on Interest

What do Ben and Arthur teach us about savings? The earlier you start investing the more you will have in the end

11. The Rate of Return, or ____Interest_______________ rate is important when determining the future value of an investment. The higher the interest rate the larger the return.

Name__________________________________________________ Class Period___________ INVESTING VIDEO NOTES

1. What is the difference between saving & investing? Savings is for short term (up to five years) and Investing is for long term (five years or less)

2. ____Diversify_________________ means to spread around. Diversification lowers ____risk_____________.

3. With virtually all investments, as the ____risk___________________ goes up so does the potential return. 4. When discussing investments, _____liquidity__________________ is availability. (How quickly assets can be

turned in to cash.) 5. As there is more liquidity, there is typically _________less______________ return. 6. A C.D. is a _________Certificate of Deposit_____________________, typically at a bank.

7. Money market mutual funds are ____low______ risk money market accounts with check writing privileges. These are great for _____emergency_____________ _____funds___________.

8. Single stock investing carries an extremely _____high_______ degree of risk. When you buy stock, you are buying a small piece of _______ownership____________ in the company. Your return comes as the company increases in value or pays you, its owner, some of the profits-- otherwise known as ___________dividends_______________. A bull market is when the market goes ____up_______. A bear market is when the market goes ____down__________.

9. A bond is a ____debt__________ instrument by which the company owes _____you_________ money. Your return is the fluctuation in price and the ______interest____________ rate paid. Few individual do well with _____single__bond_____ purchases.

10. A mutual fund is when a group of investors pool their ____Money______________ and invest it. Portfolio managers manage the pool or ______money_________. Your _____return__________ comes as the ____amount_________ of the fund is increased. Mutual funds are good ____long_________ term investments.

11. Real estate is the least ______liquid_______________ consumer investment. You should have lots of ______cash___________ before using real estate as an _________investment______________.

12. The worst type of investments are ______Gold__________, ___Commodities______________ & Futures, Day____Trading___________, and Viaticals.

13. What can the "Rule of 72" Determine? The number of years it will take an investment to double

Name__________________________________________________ Class Period___________ Debt Video Notes

DEBT VIDEO NOTES

1. According to The Wall Street Journal, ______70_____% of Americans are living paycheck to paycheck.

2. When it comes to debt, if you tell a lie or spread a _____myth_____________ long enough, eventually it becomes accepted as the ______truth______________.

3. Debt has been _______marketed___________ to us with such intensity for so long that to imagine living without it requires a complete __paradigm____________ shift, a completely new way of looking at things.

DEBUNKING DEBT MYTHS

4. Myth: If I ____loan________________ money to a friend or relative, I will be helping them. Truth: The relationship will be strained or _____destroyed________________.

5. Myth: By ____cosigning_________________ a loan, I am helping out a friend or relative. Truth: The bank requires a cosigner because the person isn't likely to ____repay________. Be ready to pay the loan and have your credit damaged.

6. Myth: ____Payday_____ _____Lending______________, rent-to-own, title pawning, and tote-the-note lots are needed ___services___________________ for lower income people to help them get ahead.

Truth: These are greedy rip-offs that aren't needed and benefit no one but the owners of these companies.

7. Myth: The ___lottery______________ and other forms of gambling will make me ______rich_____________. Truth: The lottery is a ______tax_________ on the poor and on people who can't do math.

8. Myth: ___Car_________________ payments are a way of life and you'll always have one. Truth: Staying away from car payments by driving reliable cars is what the typical ___millionare________ does that is how they became millionaires. The average car payment today is $464 per month.

9. Myth: You can get a good deal on a ______new____________ car. Truth: A new car loses ____70%______________ of its value in the first four years. This is the largest purchase most consumers make that goes down in value.

10. Myth: You need a ______credit______ ___card______ to rent a car or make ___purchases___________ online. Truth: A ____debit______________ card does all of that.

11. Myth: I pay my __credit_____________ ______card_________ off every month with no payment or fee. I get points, air miles, and a free hat.

Truth: When you use cash instead of plastic, you spend ______12-18%________ less because spending cash hurts.

12. Myth: Debt is a _____tool_____________. It should be used to create prosperity. Truth: The _____borrower__________ is slave to the lender. When surveyed, the Forbes 400 was asked, "What is the most important key to building wealth?" ______75%___________ replied that becoming and staying _______debt__________ free was the number one key to wealth building.

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