Tips and Tools For Financial Success - Newton Free Library

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Read the scenario, review the Monthly Income and Expense Worksheet on the following page, and answer the questions below. Scenario Shanise is recently divorced and has two children. Her ex-husband has not been able to provide child support for the last two months because he was laid off from work. Shanise was working parttime before the divorce and had planned to do so until her youngest child went to school. However, that plan has changed and she had to get a full-time job. Her monthly net wages, or take-home pay, is about $1,850. She also receives an Advance Earned Income Credit (EIC) of $150 a month. During the divorce Shanise and her husband lost their house because neither of them could afford the mortgage. She is currently renting a place for $750 a month. She has a $420 car payment, and it costs her about $100 a month for gas. Car insurance averages about $75 a month. She has been able to save some money on child care because her husband is able to care for the kids some of the time. However, she still pays about $150 a month on child care. Shanise also pays $110 for her cable, Internet, and home phone and $45 a month for her cell phone. Water is included in the rent, but her electric bill averages out to about $80 a month with budget billing. She pays about $400 a month for groceries and at least $150 on personal expenses for herself and the kids. Additionally, her monthly credit card payments are about $100 a month. When she does not have time to prepare meals she takes the kids out to eat or eats out for lunch, which probably totals about $120 a month. Questions Do her expenses exceed her income? Can you identify some ways she might change her spending to help balance her income and expenses? If Shanise is unable to balance her income and expenses, how would you recommend she prioritize her spending or expenses? 45
Shanise’s Monthly Income and Expense Worksheet Income Expenses Wages $1,850 Fixed Expenses Rent/Mortgage $750 Public Assistance Child Support/Alimony Interest/Dividends Social Security Advance EIC $150 Property Taxes/Insurance Cable/Telephone/Internet Cell Phone Car Payment Car Insurance $110 $45 $420 $75 Other Health Insurance Other Loan Payments Flexible Expenses Savings Water Electric $80 Gas/Oil Groceries Eating Out Transportation/Gas $ Credit Cards Day Care/Elder Care $400 $120 $100 $100 $150 Car Maintenance Education Personal Expenses $150 Donations Total Income $2,000 Total Expenses $2,500 46
Page 1 and 2: Financial Literacy at the Library T
Page 3 and 4: Background and Acknowledgments Fina
Page 5 and 6: Chapter V. Credit Overview of Credi
Page 7 and 8: 6 Newton Free Library hosted Financ
Page 9 and 10: 8 © 2011 American Consumer Credit
Page 11 and 12: Goal Setting & Financial Planning (
Page 13 and 14: Financial Goals Worksheet (SMART)
Page 15 and 16: Planning For Unexpected Life Events
Page 17 and 18: 1. Determine what to keep at home a
Page 19 and 20: 5. Keep a close watch on your bank
Page 21 and 22: 20 Kip Child, FDIC Community Affair
Page 23 and 24: Introduction to Banks (from FDIC Mo
Page 25 and 26: 24 Debit Cards • Fees? • Fee wa
Page 27 and 28: Ways to Take Money Out of Your Acco
Page 29 and 30: Using Electronic Banking (from FDIC
Page 31 and 32: Activity 1: Checking Account Fees (
Page 33 and 34: Activity 3: Record Transactions in
Page 35 and 36: Sample Check Register Check Number
Page 37: Paper Money Copy, cut, and put the
Page 40 and 41: III. Budgeting Practice Good Habits
Page 42 and 43: Create a Budget—and Pay Yourself
Page 44 and 45: Household Budgeting Worksheet Housi
Page 48 and 49: Increase Your Income How might how
Page 50 and 51: Develop a Spending Plan A spending
Page 52 and 53: Implement Your Plan Seek Assistance
Page 54 and 55: • Educate yourself and learn more
Page 56 and 57: Budgeting Quiz 1. How long should y
Page 58 and 59: Budgeting Quiz -Answers 1. Correct
Page 60 and 61: IV. Saving and Investing Preparing
Page 62 and 63: The true magic of compound interest
Page 64 and 65: 9. Pay off high-interest credit car
Page 66 and 67: Risk-Return Relationship Table (FIN
Page 68 and 69: Compounding with Tables (FINRA Inve
Page 70 and 71: Retirement Savings Vehicles (FINRA
Page 72 and 73: In most cases, you roll over a trad
Page 74 and 75: Activity 2: Savings Goals Worksheet
Page 76 and 77: Investing Quiz 1. Which of the foll
Page 78 and 79: Investing Quiz - Answers 1. Correct
Page 80 and 81: Making your First Investments http:
Page 82 and 83: V. Credit Overview of Credit What i
Page 84 and 85: What Is a Credit Report? (from FDIC
Page 86 and 87: How the Credit Report Is Used (from
Page 88 and 89: How to Get Your Free Annual Credit
Page 90 and 91: Credit Cards: What Are They Used Fo
Page 92 and 93: Credit Card Comparison Chart (from
Page 94 and 95: ACCOUNT ACTIVITY Date of Transactio
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Activity 1: Maria’s Credit Report
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Activity 3: Who Poses the Most Cred
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Credit Terms and Definitions Bankru
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8. All of the following appear on y
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VI. Borrowing Basics Types of Loans
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Car Loans (from FDIC Money Smart) T
Page 108 and 109:
To Rent or To Own? (from FDIC Money
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Activity 1: Which Loan Is Best? (fr
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Activity 3: How Much Mortgage Can P
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Note: Make sure you compare loan of
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Estimated prepaid amounts for inter
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Borrowing Basics Quiz 1. Which of t
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Answers for Borrowing Basics Quiz 1
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VII. Life Skills Menu Planning Work
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Grocery Shopping Tips 1. Clean out
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Computer Terms and Definitions Comp
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Housing Terms and Definitions Appli
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8. According to the 2010 Consumer E
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VIII. Glossary Glossary (excerpted
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Compounding: Interest paid on money
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Interest: A percentage of your bala
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Stocks: Parts of a company, called
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IX. Recommend Resources Bibliograph
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Careers and Life Skills Bostick, Na
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Heath, Julia A. Personal finance es
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Debt information for teens: tips fo
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Tutor/Teacher Cordell, Jane. Cambri
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Newton Free Library Financial Educa
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I. Learning English Online Resource
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Investor Knowledge Quiz - http://ww
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American Consumer Credit Counseling
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Nationwide Resources (from American
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This publication is made possible b
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