Lauren's Guide to Managing
MONEY
By: Lauren Lashly
Chapter 1 GOAL SETTING In order to be successful in life, you need to establish goals. Goals help motivate you to work towards something you want to accomplish. Most people set empty, unrealistic goals, but if you set SMART goals, you will be able to efficiently tackle anything! SMART stands for: Specific Measurable Attainable Realistic Timely Ex: I will go to the gym for 30 minutes everyday for three months, so I can lose at least 15 pounds.
CHAPTER 2 PLANNING AHEAD FOR THE FUTURE It's important to have an idea for what your future is going to be like. Even though life constantly changes, it's a good idea to create a timeline of what you want your life to be. You want to be able to plan accordingly and be organized so that you can be prepared for and stable when you retire.
CHAPTER 3 CREATING A BUDGET In order to make sure you are managing and keeping track of your expenses, you want to create a monthly budget. It will help show you how much money you need to set aside each month in order to cover your living costs. To create a monthly budget, you need to: 1. Set your financial goals 2. Estimate your income 3. Budget for unexpected expenses 4. Budget for fixed expenses 5. Budget for variable expenses 6. Record what you spend 7. Review spending and saving patterns
CHAPTER 4 WRITING PROFESSIONAL EMAILS If you are applying for a job, or simply want to email your boss, it is essential that you know how to do so professionally. Just follow these simply directions and you will be able to email like a pro in no time!
1. 2.
3.
4. 1. Subject that refers to something in the email 2. Professional greeting (other option: "To whom it may concern") 3. Body paragraphs: usually includes (in order) why you are writing, what you have to offer/ what you're seeking, and thanking person for whatever you are asking about/for 4. Restating interest
CHAPTER 5 KNOWING THE PARTS OF A CHECK At some point in your life, if you haven't already, you will have to write a check. What if you don't know anything about a check or what the parts of it are? DON'T WORRY! Just look at the sample check below to help you figure out what each part is. YOUR NAME ADDRESS
DATE PAYEE (who the check is to)
AMOUNT
AMOUNT IN WORDS OCCASSION BANK ROUTING NUMBER
ACCOUNT NUMBER
SIGNATURE LINE CHECK NUMBER
CHAPTER 6 PROS AND CONS OF USING CREDIT There are many types of payment methods such as checks, cash, and debit cards, but what is a credit card? A credit card is like a debit card, but instead of having money directly withdrawn from your bank account, you are given a loan of money from a bank that you will eventually have to pay back. Before using a credit card, it is very important to know what the advantages and disadvantages are so you know what you are getting into.
PROS
CREDITÂ CARD
-Convenient -Useful for emergencies -Can purchase big ticket items earlier -Easy form of debt consolidation -Protection against rip offs and fraud
CONS -Interest is costly -Additional fees are common -Tempting to overspend/easy to go in debt -Privacy is an increasing concern -Identity theft is easier
CHAPTER 7 LEARNING ABOUT INTERVIEW DO'S AND DON'TS: CLOTHES Job interviews are very crucial in determining your job status. It is important that you make a good first impression on your new possible employer. You need to dress for success, but do you know what you should wear?
DO -Wear blues: represents credibility, trustworthiness, and confidence -Wear black: represents leadership and authority -Wear sensible shoes -Dress appropriately depending on the type of job (you wouldn't wear a suit to an interview for a job at Target)
DON'T -Wear red: represents rebellion and aggression -Wear shirts with large logos on it -Wear orange: represents someone who's unprofessional -Wear brown: sends the message of being simple and old- fashioned
CHAPTER 8 LEARNING ABOUT COMPOUND INTEREST
Interest impacts the time value of your money, depending on if you're receiving the interest or paying it. However, if you are paying/receiving compound interest on an investment, it can have an immense impact on how long it takes to increase your money. Compound interest is interest that a person earns on interest. It is a lot more powerful than simple interest and can effect the weight of an investment. If you are paying compound interest, be careful and make sure you manage your money so you don't go into debt. If you have to chance to receive compound interest, take this as an advantage because it can grow your money fast!
CHAPTER 9 LEARNING ABOUT THE STOCK MARKET The stock market is where stocks, or small percentages of ownership in a company, are traded. They can be traded on the New York Stock Exchange (NYSE) or NASDAQ. The NYSE is on Wall Street in New York and the stocks are traded personally amongst large groups of people. NASDAQ is also in New York, but is only a building that electronically displays stocks being exchanged online. Stocks can be a great way to earn money quickly based on the performance of the company you bought ownership in. However, if the company's sales aren't doing well for whatever reason, it could reflect in your investment and you could actually end up losing money. If you decide to take part in the stock market, make sure you are financially prepared!
CHAPTER 10 70-20-10 RULE One of the most important things when it comes to finances, is figuring out a good strategy to rationing your money. A good tip to help you with this is the 70-20-10 Rule.
70
Spend 70% of your money
20
Save 20% of your money
10
Invest 10% of your money