LOAN STAR’ S BUILDING YOUR FINANCIAL FUTURE
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Loan Star’ s
Building Your Financial Future FINANCIAL LESSONS TO HELP TEENS NAVIGATE REAL LIFE
Small Payments Can Mean Big Costs When Borrowing
MONEY TIPS
Spring 2014
by FDIC Consumer Affairs
Here’ s a situation you won’ t encounter for a few years, but it’ s never too early to begin learning how credit (borrowing) works. The main message is this: The longer you take to pay back what you owe on a credit card or loan, the more you’ ll pay the lender in interest charges. In particular, if you use a credit card to make a major purchase and you only pay back a little of what you owe each month, “ it will take you a very long time to pay off the balance, and the interest costs can be shocking,”according to Janet Kincaid, FDIC Senior Consumer Affairs Officer.
The chart below shows what an expensive purchase will really cost you if you charge it and only pay back the minimum amount due each month, which may be something like $20 or $30. In this example, a $500 stereo would end up costing you about $900 when you figure in the total interest you’ d pay, and a $1,000 computer would set you back more than $2,100. If you instead pay back as much as you can each month—the entire balance, if possible— you can really limit interest charges.
Cut Back, Not Out These students discovered they spent $10 a week on soft drinks. They cut back half that, saved some calories and protected their health, and ultimately saved over $200 a year to use for future smart choices. What can you cut back, not out, and save for your future?
You’ re Not Alone!
Affairs Officer.
Don’ t think you’ re the only person with money issues! It’ s likely your friends and even your family worry about money too so try this: Get with your friends and family and talk about planning your financial futures. This collaboration will keep you accountable and on track and learn from each other. See “ Savings Club”article in this issue of Building Your Financial Future.
LOAN STAR’ S BUILDING YOUR FINANCIAL FUTURE | Issue2
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Graduation Goals by Loan Officer
It seems like a long time ago that I graduated from High School and to my teen friends and family it may seem like an eternity! But what I learned about finances after school are what I’ m hoping to pass on to teens BEFORE they graduate. This head start to money management is a lesson that will truly last a lifetime. Believe me, money issues never go away –you have enough, not enough, or rarely, too much! So I challenge every teen to write down your Graduation Goals in respect to your finances. To do that, make a plan for the following money matters:
GRADUATION GOALS: YOUR FINANCIAL FUTURE Simply writing out your goals –not just for money goals but for any goal –is a huge step in getting what you want. So get with some friends or family and write out your goals and a plan to get there and see what happens!
1.
By Graduation I will have saved $___________________
2.
I will need $ ________________ to attend college or trade school.
3.
Before Graduation I want to buy _____________________ and it will cost $_____________________.
4.
I will have not gone in debt more than $__________________ before Graduation.
5.
I will only borrow $ _____________________ in Student Loans for college or trade school and will earn the rest!
How to Start a Savings Club by Loan Officer
Starting a group to talk about money may not seem very cool, but once you and your friends are on track, have money saved and plans for the future, you’ ll be cool and loaded with respect and a pocket full of cash –now that’ s cool! Starting a Savings Club is easy. Start with your teachers –find one that will help get you started, a place to meet, and some tools to work with. And of course, advise you along the way too! Invite your friends to join you and plan your goals and make a plan to reach them – together. Once you get started it will evolve into a money adventure that will last a lifetime! Good luck and happy savings!
BUILDING YOUR FINANCIAL FUTURE Loan Officer | Senior Loan Officer NMLS 111111 LoanStar Home Lending Phone: 555.506.0542 Email: loanofficer@GoLoanStar.com
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