Financial Literacy

Financial Literacy

This personal financial literacy course is designed to alert, inform, and educate students in concepts of personal finance and money management. Students will begin to develop the skills and strategies that promote personal and financial responsibility related to financial planning, savings, investment, and charitable giving in the global economy. Effective money management is a disciplined behavior. It is difficult to master, and much easier when learned earlier in life. This course will start students on a path toward being in control of their financial futures. Five broad topics will be the foundation of the course: college and career planning, money management, savings and investing, income, and spending. The course will teach students to search and assess college and career opportunities, identify and prioritize their personal money management goals, develop personal spending and savings plans, comprehend the impact of time on the value of money, understand the cost of using credit, and protect assets.

Topics/Outcomes:

· Use a rational decision-making process to set and implement financial goals.

· Explain the effect that goals, decision-making, and planning have on personal financial choices and behaviors including: home ownership, work ethic, charity, civic virtue, net worth statements, budgets, income and expense records, insurance plans, savings and investing plans, personal financial plans, and shortterm and long-term financial plans.

· Analyze the role that cultural, social, and emotional influences have on financial behavior. Analyze the impact of marketing, advertising, and sales strategies/techniques on purchasing decisions (e.g., impulse buying, delayed payment).

· Determine the role that financial decisions play and their impact on personal and societal consequences (e.g., increased consumer costs, inflation, family instability). Describe the social and economic consequences of bankruptcy. •

· Understand various sources of income and the relationship between income and career preparation.

· Identify various forms of income and analyze the factors that affect these types of income including wages, investments, self-employment, insurance, leave, retirement. Compare income to the cost-of-living in various geographical areas. Analyze how economic conditions affect income. 26

· Identify and understand required income withholdings including taxes and the reason for taxation as well as the uses of tax revenues, Social Security, Medicare, payroll, and personal state and federal income taxes. CWR 3.4.8

· Analyze criteria for selecting a career and identify the impact of career choices on both income and financial stability. Describe the correlation between income and a worker’s skills and education, the value of the work to society, the condition of the economy, and the supply and demand for workers.

· Describe the role of planning and maintaining a balanced budget and develop one. Develop, monitor and evaluate a personal budget that includes debit, checking, savings accounts. Evaluate the impact of major purchases on budgeting (e.g. automobile, housing). Interpret multiple personal budget examples. CWR 3.4.9

· Understand credit uses and compare costs associated with them. Calculate and compare costs associated with the use of credit including: finance charges, interest, late fees, default rates, closing costs. Calculate loan repayments and the total costs when borrowers make minimum payments. CWR 3.4.7

· Describe and analyze the impact of credit on money management. Compare both the advantages and disadvantages of different payment methods. CWR 3.4.7

· Analyze the rights and responsibilities of buyers and sellers under consumer protection laws including but not limited to: “Identity Theft and fraud”, financial contracts, payment penalties, method of interest calculation, disclosure information, repayment, financial scams and schemes designed to defraud consumers such as pyramid schemes. CWR 3.4.7

· Compare and contrast the role of insurance as a device to mitigate risk and to calculate expenses of various options (e.g., automobile, health, homeowners, renter’s, life, long term disability). CWR 3.4.11

· Develop an effective retirement savings plan to meet personal financial goals including IRA’s, ROTH accounts, and annuities. Explain the effects of inflation on savings and investments. CWR 3.4.10

· Describe the value of investing and types of investments in the financial planning process including: stocks, bonds, real estate, hard assets. Compare long-term and short-term investments.

· Compare savings and investment including the risk, return, liquidity, and costs for savings and investments. Solve problems involving compound interest. Demonstrate the relationship between simple interest and linear growth and compound interest and exponential growth.