Green Student Workbook 2020 by Rock The Street, Wall Street

Table of Contents Our Mission and Vision

Our Goals

Women Suffer More From Math Anxiety

Statistics

Green Curriculum Workbook Sessions

Expectations for Classroom Sessions

Session 1 Agenda

Learning Objectives and Key Terms

Personal Finance Activity

RTSWS Stock Portfolio — Yahoo! Finance

After Session 1: Important Activities Before Session 2

Session 2 Financial Planning for Janella (Part One) Agenda

Learning Objectives and Key Terms

How to Read a Pay Check Stub

Janella’s Pay Stub Activity

Financial Planning Activity

Janella’s Budget Worksheet

Seven Retirement Planning Mistakes Millennials Are Making

After Session 2: Important Activities Before Session 3

Session 3 Financial Planning for Janella (Part Two) Agenda

Learning Objectives and Key Terms

Classroom Discussion: Economic Lessons from COVID-19

10 Ways to Prepare for a Personal Financial Crisis

Stock Market Comeback may hit wall as coronavirus cases spike

Important Actitivities Before Session 4

Session 4 Financial Planning for Janella (Part Three) Agenda

Learning Objectives and Key Terms

“What Is Risk Tolerance, and Why Is It Important?”

Janella’s Budget Review

Investments for Beginners (excerpts)

“What Compound Interest Means for Your Savings”

Important Activities Before Session 5

Post-Assessment Review Sheet

Session 5 Agenda

Post-Assessment and Financial Planning Presentations

Best Jobs for Graduates with a Finance Degree

Resources

For visual reference of Key Terms in this workbook, please go to: www.rockthestreetwallstreet.com/green-reference/

ABOUT ROCK THE STREET, WALL STREET

Our Mission Rock The Street, Wall Street is a financial and investment literacy program designed to spark the interest of a diverse population of high school girls into careers of finance. Girls learn about saving, investments, budgeting, stock and capital markets and their role in maintaining the welfare of their families, communities and the economy, while simultaneously helping them see the real world application of the math content they learn in the classroom. Rock The Street, Wall Street believes to close the gender gap in the wages, wealth and in the financial services sector, we have to inspire girls to pursue the M in STEM and finance, by exposing them to real life role models. The number one reason why girls are not choosing STEM professions - they don’t see women in those professions. The number two reason - they don’t see their friends choosing those majors in college. We engage female financial pros who walk the talk on all matters financial. They teach and motivate the next generation. Our students see girls in their RTSWS cohort choosing finance, economics or a related computational field as their majors/minors. Whether they choose the profession, or head into another field, our students are far better prepared for critical decision making on all types of financial and career prep matters.

Our Vision Rock The Street, Wall Street hopes to break the cycle of multi-generational financial naivete so that girls have a better chance at improving their lives, their households and their communities. Forty years after the adoption of Title IX, women continue to confront barriers to full equality at all levels; most critically of which is in their financial lives. This is even more egregious for women of color, where they earn, save and invest at lower rates. In college finance and economics classrooms, girls are few in number. As a result, their opportunities in pay, promotion, and life are unequal. Equipping girls with financial skills is a vital part of ensuring equal opportunity. Financial literacy is The Great Equalizer. Rock The Street, Wall Street is reaching young women at their local high schools. We offer young women a flight path to a financial education through hands-on financial projects, workshops, role modeling, mentoring and real-life Wall Street experiences. Girls are introduced to financial concepts such as savings, investments, post-secondary and college financial preparedness, budgets, stocks, bonds, financial analysis, venture capital and private equity.

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Our Goals OUR GOALS Our Goals • Address the economic inequality that exists among women and particularly among women of color. • Increase financial and investment literacy of girls at a young age so that they are aware of the financial responsibilities AND opportunities of post-secondary life, college life, at work, at home and in their communities. • Teach girls on how being financially independent is key to living a self-determined life. • Open girls’ minds to view math-focused fields of study as compatible with a career that has a positive impact on the world. • Spark girls’ enthusiasm for finance at a critical age and make them aware of the societal benefits personal financial knowledge and math-oriented careers can have. • Close the gender gap in wages, investments and wealth accumulation for all women, particularly for women of color. • Create the social capital between students and female financial professionals that will enable students to get a jumpstart on their personal money management behavior and on their college and work lives. • Increase the number of women studying finance, economics or related computational business field • Create an early pipeline of female talent so as to Increase the number of women who enter into the financial services industry. • Provide a pathway to better lifetime money management, academic performance, and college preparation. • Coach students on resume building • Provide career discovery by offering job shadowing and/or industry summer internships • Foster students’ continued growth in finance through their college years and into the workforce • Create a longitudinal cohort of girls who can network with each other across cities, socio-economic lines and industries.

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ARTICLE Women suffer from ‘math anxiety’ more than men do — here’s how to reverse it By Alessandra Malito, MarketWatch (October 24, 2019) https://www.marketwatch.com/story/women-suffer-from-math-anxiety-more-than-men-heres-how-to-reverse-it-2019-10-24

This teacher-turned-financial adviser on the different ways men and women approach math and life Many Americans suffer from “math anxiety,” which inhibits their ability to solve problems — a potential issue when it’s time to balance a checkbook or save for retirement. Math anxiety may start in the classroom during childhood but it has a way of following students throughout their lives, said Maddie Parker, a financial adviser at Parker Financial Group in Overland Park, Kan., who started her career as a high school math teacher before switching to financial planning. She has seen people postpone their financial plans and refrain from saving for retirement because they don’t want to deal with the possibly complicated equations and complex investing topics. A fear of math can be debilitating — and not just because it could result in poor math grades. Many students, especially girls, may avoid careers that include a heavy amount of math, especially those in STEM (Science, Technology, Engineering and Math) fields. https://www.marketwatch.com/story/the-gender-gap-starts-inninth-grade-2018-08-20 Girls made up just 30% of the top 5,000 ninth-graders in the American Mathematics Competitions, according to research distributed by the National Bureau of Economic Research in 2017. Just 18% of the top 500 ninth-graders were girls, and only 8% of the top 50. That gender gap worsens as they age — by senior year, only 22% of the top 5,000 are girls (compared with the 30% in ninth grade), followed by just 12% of the top 500. Parker, 30, taught Algebra II and geometry to high-school students before switching to financial planning and working with her 76year-old father, who has his own firm. She also became a Certified Financial Planner. “I have a math background and the CFP puts me in a good position to do financial planning in a way that educates people about the planning and why,” she said. Their age difference also helps them work with clients of all ages and provide their own perspectives, she added. Parker spoke with MarketWatch about her education background, why people are so worried about math and how to mesh the two: MarketWatch: How exactly would you describe math anxiety? Maddie Parker: A lot of people would say “I have that” and to a degree, a lot of people do, but it’s more than feeling like you don’t do well on exams. Kids who have math anxiety almost always have a physical inability to respond to being tested or asked to perform on math-related tasks. It is just built up over the years of different experiences, and it stops them from being able to learn any further. MW: Is it something adults face?Parker: It translates from kids to adulthood. When you get out of school, you’re less exposed or have less experience being tested so the anxiety may seem like it’s gone away but any time math or that skill is required, the anxiety comes right back. I think it has been perpetuated as a weird acceptance in our country, that it’s OK to be bad at math. Like, “oh, math is hard and it’s OK not to get it.” It definitely follows into adulthood and affects people dealing with finances, because they have to do math and they don’t know how to do it, and they’re stressed or embarrassed to ask for help. MW: How can math anxiety impact personal finances? Parker: In high school, you’re not required to take personal finance and the math you’re doing is unrelated to what you do in real life. And that real life math in your brain is still tied to calculus so you think, “I couldn’t do that at 16, I probably can’t handle finances now.” But it is different math. It’s not to say it’s simple, but it’s different, and it is applicable in such a way that people do find it easier to understand. It is not quite as challenging as graphing logarithmic equations. It’s a lot different.

4 MW: There are many people who say women generally are more likely to have math anxiety than men. Is that something you’ve seen? Parker: There are great articles and podcasts and TED talks about the same concepts, of how we’re raising our girls to be perfect and raising our boys to be brave. And there was one example at a girls’ coding camp, where they have to learn to do coding and the girls specifically would type up all this stuff and then if they couldn’t figure it out they’d erase it all and call the teacher over. The teacher would press undo and show all of this work and that they were really close, but because the girls couldn’t make it work they wanted to tell the teacher to show them from the beginning. They didn’t want to show this not perfect work. It is just a good example that demonstrates that girls are being raised to be perfect and not in the same way as boys, who may say (like in that example) that they don’t care and at least they’ll get partial credit. The only way to learn is by making mistakes, but that gets lost on girls when they feel they have to be perfect. MW: Does that concept translate to adult couples in financial planning? Parker: It is more apparent for women when they are single individuals. They’re more comfortable saying “I don’t get it” or it’s more evident. They’re not as afraid to ask for help. It’s when they’re with their spouses it is easier to be quiet or let them talk and pretend you understand things because your partner is helping you, but it is still relevant. I always work with most clients together and I will ask them both “do you understand this?” or make sure they’re both on the same page. MW: How would you say your background as a math teacher benefits you and your clients? Parker: One of the biggest ways is in my ability to explain things. It’s funny, I majored in math and decided to be a high school math teacher, but when I was in high school, I struggled with math. I had good grades and I didn’t have math anxiety, but I wasn’t some freaky Einstein genius kid who got it all. It made sense when I didn’t get something right and because I liked it so much I worked hard to understand it. I was good at explaining things to my friends. But my own struggle made me good at explaining it. A lot of math teachers are geniuses who understand it, and that makes it hard to explain it to students who are struggling. That ability translates nicely to doing financial plans. I can see what is probably going to confuse them and where they’ll get lost. MW: Are there any math-related topics that clients typically have a hard time understanding? Parker: It varies, but one big thing we talk about is inflation and compound interest. The need to factor in inflation because a dollar today is not going to be a dollar 10 years from now, and that it is a slow climb. People are amazed at how different the numbers look when I factor in 2.5% inflation. MW: Is there any way to overcome math anxiety? Parker: It is important that there be no stigma about it. There’s this expectation people have of themselves that they should know more about finance because it applies to their life. I am a financial adviser and I don’t know how to fix my car, so I bring it to be serviced by professionals. I don’t feel stupid because I didn’t focus on that and I know nothing about it. It can be scary if you don’t know who you’re going to and unfortunately there are some bad people out there, but if you do your homework to find the people to help you, you don’t need to feel ashamed or embarrassed. That’s the whole reason you find a professional to begin with — someone who is trained. That’s their job.

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Green Curriculum Workshop Sessions

Green Curriculum learning outcomes: • To play the role of a financial planner for Janella Sims, a 28-year-old female, where student teams create a budget for her keeping in mind her short-term and long-term financial goals. • To define basic investment terms. • To follow the price movements of Amazon (AMZN), Clorox (CLX), Netflix (NFLX) stock and the iShares Nasdaq Biotechnology ETF (IBB) over the weeks we’re together in class. • To understand and be able to explain where their tax dollars go. • To understand and be able to explain living expenses. • To become familiar with various types of careers in finance. Session Topics and Key Terms: Please write the date/time/location of each session in this book and in your phone calendar to set reminders. Session

Key Terms

1: Introduction and Pre-Assessment

• Saving • Investing • Stock • Exchange-Traded Fund

2: Financial Planning for Janella (Part One)

• Fixed Expense • Variable Expense • Occasional (or Periodic) Expense • Budget • Retirement Accounts

3: Financial Planning for Janella (Part Two)

• Checking Account • Savings Account • Bond • Loan • Debt • Mortgage • Stock Market Volatility

4: Financial Planning for Janella (Part Three)

• Investment Risk Tolerance • Mutual Fund • Venture Capital • Inflation • Interest • Compound Interest

5: Post-Assessment and Presentations

Date / Time / Location

Expectations For Classroom Sessions

We are all here to become financially literate, learn from fierce females in finance, and to have fun! In order to do so, we have classroom expectations so it’s a great experience for everyone. By participating in our program you are committing to these expectations. 1. Be on time and even better, early! 2. Let one of the school champions know if you will be absent or late to the session ahead of time. (Write below the name and contact information for the school champions) School Champion 1: _________________________________ School Champion 2: _________________________________ 3. Use the restroom before coming to the session. 4. All students are required to stay for the entire session. 5. You may eat during the session as long as it’s not disruptive. 6. Our expectation is that you will attend ALL sessions. If you miss any, please know it will impact your ability to attend our field trip and any ongoing opportunities. 7. Most of all - have fun and enjoy learning from these amazing women.

Girls Who Invest is a non-profit organization that prepares undergraduates at U.S. colleges and universities for careers in investment management. There are two internship opportunities availablein college with Girls Who Invest. As a result of our close relationship with them, our students have a unique head start over other applicants. We will be recommending a minimum number of students who have excelled in RTSWS to be fast tracked in their application process. • Only those who have strong attendance and post-assessment scores will be taken into consideration for these opportunities • You must also have your RTSWS student release form filled out completely and correctly to be considered • We will continue to reach out about this opportunity and other career opportunities throughout high school and college

Green Curriculum: SESSION ONE

Session 1 Agenda

1. Introduction: Volunteers and the Rock The Street, Wall Street Program 2. Get to Know Each Other: Class Discussion 3. Take the Pre-Assessment • You are NOT being graded we just want to know what you already know - it’s okay to put “I don’t know” as an answer • This will not be shown to your school or any teachers • You will recieve a text message with the link to take the pre-assessment. It will also be written on the board if you need to type it into your web browser. 4. Learning Objectives and Key Terms • Definitions and visuals are provided in this session for you to review. 5. Personal Finance Activity: Spending, Saving, Investing 6. Review Yahoo! Finance Portfolio • We will be following the same stocks each week. 7. Connect with Rock The Street, Wall Street’s Social Media Platforms

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Green Curriculum: SESSION ONE

Session 1 Introduction and Pre-Assessment Learning Objectives 1. Learn how the RTSWS program works and why it exists. 2. Understand what a stock portfolio and watch list are and become familiar with the stocks we will follow on our watch list in the weeks ahead. 3. Explore how people spend money and understand the distinction between saving and investing money. Learn the related key terms below.

Study These Key Terms 1. Saving Saving is setting aside money you don’t spend now for emergencies or for a future purchase. It’s money you want to be able to access quickly, with little or no risk, and with the least amount of taxes.* 2. Investing Investing is buying assets such as stocks, bonds, mutual funds or real estate with the expectation that your investment will make money for you. Investments usually are selected to achieve longterm goals. Generally speaking, investments can be categorized as income investments or growth investments.* 3. Stock A share of ownership in a business or corporation. Companies sell shares as a way to raise capital. 4. Exchange Traded Fund (ETF) An exchange-traded fund (ETF) is a collection of securities—such as stocks—that tracks an underlying index. The best-known example is the SPDR S&P 500 ETF (SPY), which tracks the S&P 500 Index. ETFs can contain many types of investments, including stocks, commodities, bonds, or a mixture of investment types. An exchange-traded fund is a marketable security, meaning it has an associated price that allows it to be easily bought and sold. The price of an ETF’s shares will change throughout the trading day as the shares are bought and sold on the market.*

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Green Curriculum: SESSION ONE

ACTIVITY - Personal Finance: Spending, Saving, Investing

Directions: For each topic you will brainstorm for 30 seconds writing down everything you can think of. There is no wrong answer! We want to gather your background knowledge on these topics. What do people spend money on?

–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––– –––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––– –––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––– –––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––– ––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––

What do people save money for?

What do you know about investing?

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Green Curriculum: SESSION ONE

ACTIVITY - Stock Portfolio

• We will be following the Amazon (AMZN), Clorox (CLX), Netflix (NFLX) stock and the iShares Nasdaq Biotechnology ETF (IBB) each week so you can see how the prices fluctuate and start following the market. • A stock portfolio is a collection of stocks that you invest in with the hope of making a profit. By putting together a diverse portfolio that spans various sectors you are able to become a more resilient investor. (https://public.com/learn/what-is-a-stock-portfolio)

• For the purposes of these sessions, we will only be following three stocks and one ETF (exchange-traded fund) so you can begin to learn the world of investing. • After Session 1 you will create your own stock portfolio on Yahoo! Finance.

The Summary tab in your saved portfolio on Yahoo! Finance features a number of useful data points for each stock, including: Last Price, Change (in dollars), % Change, Volume, Average Volume over the past 3 months, Day Range, 52-Week Range, Day Chart, Market Cap In addition, links to relevant news articles about stocks in your Portfolio are presented underneath.

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Green Curriculum: SESSION ONE

After Session 1 Important Activities Before Session 2 Activities During the week ahead, spend some time exploring the following activities before returning for Session 2. 1. Create a stock portfolio on Yahoo! Finance - www.finance.yahoo.com/portfolios/ • You will need to create your own username and password. (If you already have an existing account for other Yahoo! services, such as Yahoo! Mail, you can log in with that account.) Then, click on “My Portfolio” on the upper left side. Then, on the bottom right, click “+ Create Portfolio”. Name the portfolio “RTSWS 2020.” Under “Summary”, click on “+Add symbol”. Type in the name or symbol for what we are following this year to add them to your portfolio and watchlist. • This is what we are following this year - Amazon (AMZN), Clorox (CLX), Netflix (NFLX) stock and the iShares Nasdaq Biotechnology ETF (IBB). 2. Thoroughly review and get to know the key terms below. We want you to remember these long after RTSWS is over and all students will be taking a post-assessment in Session 5 to see how much you’ve learned. So make sure to study these! 3. Follow Rock The Street, Wall Street on our social media accounts.

Review of Key Terms from Session 1 1. Saving Saving is setting aside money you don’t spend now for emergencies or for a future purchase. It’s money you want to be able to access quickly, with little or no risk, and with the least amount of taxes.* • www.napkinfinance.com/videos/savings 2. Investing Investing is buying assets such as stocks, bonds, mutual funds or real estate with the expectation that your investment will make money for you. Investments usually are selected to achieve long-term goals. Generally speaking, investments can be categorized as income investments or growth investments. • www.napkinfinance.com/napkin/invest-money 3. Stock A share of ownership in a business or corporation. Companies sell shares as a way to raise capital. • https://napkinfinance.com/videos/stock-market/ 4. Exchange Traded Fund (ETF) An exchange-traded fund (ETF) is a collection of securities—such as stocks—that tracks an underlying index. The best-known example is the SPDR S&P 500 ETF (SPY), which tracks the S&P 500 Index. ETFs can contain many types of investments, including stocks, commodities, bonds, or a mixture of investment types. An exchange- traded fund is a marketable security, meaning it has an associated price that allows it to be easily bought and sold. The price of an ETF’s shares will change throughout the trading day as the shares are bought and sold on the market. • https://napkinfinance.com/videos/etfs/

*Source: https://www.napkinfinance.com

LinkedIn RTSWS Student & Alumnae Networking Group linkedin.com/groups/7029520/ If you are 16 years of age or older, join our RTSWS LinkedIn Students & Alumnae Networking Group. As a member, you will be able to learn about internship and job opportunities, connect with your peers, stay informed of relevant news and more. Students already in the group have successfully leveraged their membership to network with RTSWS students from all over the U.S. We strongly encourage you to join our RTSWS LinkedIn Students & Alumnae Networking Group.

LinkedIn RTSWS Company Page linkedin.com/company/rock-the-street-wall-street LinkedIn-company page is a social network that focuses on professional networking and career development. You can use LinkedIn to display your resume, search for jobs, and enhance your professional reputation by posting updates and interacting with other people. Please follow our company page for Rock The Street, Wall Street and get to networking!

Instagram Follow us at: girlsrockwallstreet

Facebook Follow us at: facebook.com/girlsrockwallst

Twitter Follow us at: @girlsrockwallst

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Green Curriculum: SESSION TWO

Session Session22Agenda Agenda

1. Introduction: Welcome and any new volunteer introductions 2. Learning Objectives and Key Terms • Definitions and visuals are provided in this session for you to review. 3. Review Yahoo! Finance Stock Portfolio 4. Classroom Discussion: Budgeting 5. Financial Planning Activity: Janella Sims 6. Important Activities Before Session 3 7. Ask about upcoming Student Field Trip* (subject to change)

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Green Curriculum: SESSION TWO

Session 2 Financial Planning for Janella (Part One) Learning Objectives 1.

Explore the concept of budgeting and learn the differences among fixed, variable, and occasional (or periodic) expenses, along with what retirement accounts are and the different types of accounts. These are all key terms for this session.

Understand how to read a pay stub (i.e. earnings statement) and become familiar with the various types of deductions that typically factor into an employee’s amount of take-home pay.

Apply your newfound knowledge to create a budget for Janella Sims, a fictional 28-year-old woman for whom your group will provide financial planning services.

Key Terms 1.1 Fixed Expense Fixed expenses cost the same amount each month. These bills cannot easily be changed and are usually paid on a regular basis, such as weekly, monthly, quarterly or from year to year. Examples: Rent, car payment, mortgage, home/rental/car insurance, gym membership. 2.

Variable Expense Discretionary expenses that vary from one month to the next. These bills can be easily changed. Examples: Utilities (water, gas, electric based on usage), groceries, gas for your car

Occasional (or Periodic) Expense Like fixed expenses, these bills generally cannot be easily changed, but do not occur on a regular weekly or monthly basis, making them more challenging to plan for. Examples: New seasonal clothing (winter jacket no longer fits), school tuition, home/ car maintenance

Budget A budget is an estimation of revenue and expenses over a specified future period of time and is utilized by governments, businesses, and individuals. Personal budgets are extremely useful in managing an individual's or family's finances over both the short and long periods of time. Short = 1 year, Long = 5-10 years

Retirement Accounts A plan for setting aside money to be spent after retirement.There are different kinds of retirement accounts: 401(k), 403(b), Roth IRA, Traditional IRA.

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Green Curriculum: SESSION TWO

ARTICLE How to Read a Pay Check Stub Co-authored by Michael R. Lewis, wikiHow, (December 20, 2019) www.wikihow.com/Read-a-Pay-Check-Stub

Before you can start financial planning for Janella you need to understand her monthly income by analyzing her pay stub. This might be the first time you’ve ever seen a pay stub so we’ve included an article to explain each part of the paystub before you take a look at Janella’s. How to Read A Paycheck Stub Learning how to read your paycheck stubs can help you to better track your income. Once you understand the layout and terminology of the paycheck stub, you can accurately track how much money you earned, how much money you took home, and how much of your earnings were given to any withholdings. Keeping a careful record of your earnings will help improve your overall personal finances. Understand Your Earnings: Look at the top of your pay stub You will find basic information at the top of your paycheck stub, such as the name and address of your employer and the date that the paycheck was issued. You may also find information about the company that processes payroll for your company. • You will likely find the check number financial records to track income sources and amounts at the top of your paycheck stub. This is useful for entering into your financial records to track income sources and amounts. • If something is wrong with your paycheck, it will likely be the fault of the payroll company. Check with human resources if you spot a problem. Find the area labeled “Gross Pay”. Gross pay is the total amount that you earned before any withholdings have been taken. The gross pay will usually be over a certain period of time, known as a pay period. • Any taxes or other withholdings will not be reflected in your gross pay. • A pay period will vary in length, depending on your employer. These pay periods may commonly cover weekly, bi-weekly, or monthly periods. Other pay periods are possible, however, not as common. Locate your “Net Pay”. Find the amount next to the area labelled net pay to learn how much of your earnings are yours to take home. An amount next to net pay has already had any withholdings or taxes removed from it. • Net Pay is the actual amount of your earnings that you will receive.

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Green Curriculum: SESSION TWO

Learning What Taxes and Withholdings Were Taken. Look for “Federal Tax Amount”. This area will give you the total amount that the Federal Government has taken from your pay for taxes due. This amount will vary depending on how many exemptions you claimed when your filed your W-4 tax form. • You can change the amount of exemptions at any time by filling out a new W-4 form. • Ask your human resources contact to change your W-4 form or how best to make changes to it. • Exemptions can be made for yourself, others, or you can claim none. Find the area labeled “State Tax”. The area marked state tax will usually be found very close to the item for federal tax. This listing for state tax will show your just how much of your earnings went to the state you live in. • State Tax will vary from state to state. • Not all states will collect an income tax. • State taxes are used for public projects such as education and health care. Locate the item labeled “Social Security”. Social security is a federally mandated payment into the social security system. When you reach an age at which you might retire, you will be able to access the social security system funds, receiving a monthly payment from them. • Paying into social security will help finance your retirement. • You will contribute 6.2% of your income to social security payments. • Your employer will also contribute 6.2% of your income to social security payments. Find the area listed as “Medicare”. Medicare is program that can help with medical payments and billing, once you are eligible for social security. Payment into Medicare is mandatory for both you and your employer. • Medicare payments are set at 1.45% of your paycheck. • Your employer is also required to pay 1.45% of your paycheck. • You may also find that your Medicare is part of another item labeled FICA. FICA usually includes Medicare. Finding Additional Items and Summaries Look for the item labelled “Year to Date”. Year to date is a useful entry on your paycheck stub that can show you exactly how much you have earned, and how much has gone to taxes or withholdings, up to the current date of that pay stub. • Use the year to date area of your paycheck stub to keep up-to-date and accurate financial records of your earnings.

Green Curriculum: SESSION TWO

Look for additional items that may appear. Each pay-stub will be unique. Beyond the more common items found on your pay-stub, there may appear additional items that you should look for. • Insurance Deductions. Your company may take money directly from your earnings and place it into your insurance policy payment. If this is so, you can keep an accurate record of how much you have paid for insurance and when the payment was made.

• Retirement Plan. If your employer offers retirement plans, they may take automatic deductions from your pay and apply them to your plan. This can be a great way to save money for retirement and if your paycheck stub has this item, you can easily keep track of your contributions. Your plan may be labeled by the type of plan you are using such as 401(k), 403(b), profit sharing, or IRA. • Time off. Some employers may enter the amount of time off you have used or have yet to use. This item, while not directly related to earnings, can still be useful in projecting how many hours of pay may be lost if taking time off. • Additional notices. Employers will sometimes put important information regarding changes to pay policies on the paycheck stub. These will help keep you informed about any upcoming modifications that may affect your net earnings.

Learn what some common abbreviations mean. Often times, your employer, or the payroll company they have hired, will make use of abbreviations on your paycheck stub to save space. Understanding these abbreviations will help you make better sense of the information presented. • YTD: Year-to-Date • FT or FWT: Federal Tax or Federal Tax Withheld • ST or SWT: State Tax or State Tax Withheld • SS or SSWT: Social Security or Social Security Tax Withheld • MWT or Med: Medicare Tax Withheld

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Green Curriculum: SESSION TWO

ACTIVITY - Janella’s Pay Stub

Now you’re ready to check out Janella’s pay stub! • This is a recent “pay stub,” or earnings statement, for Janella. She receives an annual salary of $68,000, which is divided into 24 semi-monthly payments that she receives on the 1st and 16th of each month. • For each half-two week period that Janella works, she earns a gross income (i.e. income before any deductions) of $2,833.33. • But as you can see from the Deductions column on her pay stub, she doesn’t actually get paid $2,833.33 a month because certain amounts get automatically subtracted, or deducted, from her paycheck. • Federal income tax and FICA taxes (contributions to Social Security and Medicare) are required to be deducted by law. ◦ In addition to those deductions, Janella voluntarily opts to have automatic deductions into her 401(k) investment account to save for her retirement and automatic deductions into her Healthcare Flexible Spending Account and Dependent Care Flexible Spending Account, to help her save money to cover her future healthcare and child care expenses. • After those deductions, her semi-monthly net pay is $2,152.99. This is the actual amount deposited into her account each month.

Green Curriculum: SESSION TWO

ACTIVITY - Financial Planning For Janella Sims

Introduction ––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––– Janella Sims, a 28-year-old professional, has hired your group to help with her financial planning. She needs a budget based on the annual salary from her new job, $68,000. Assume there is no statewide tax in her state.

Task ––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––– Break inrto teams of 3 or 4 students. Each team needs to come up with a feasible monthly budget that takes into account the items listed on Janella’s Budget Worksheet and her financial goals. • Each team needs to indicate the item number, item name (make more specific notes, if it is helpful), the kind of expense (fixed (F), variable (V) or occasional (O)) and the amount they want to put aside for that item. • Each team will use their phones, laptops or tablets to research the remaining expenses. • In Session 5, be prepared to present your group’s proposed budget and give Janella advice on her living and spending choices to better fit her budget and goals.

Janella’s Financial Goals ––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––– • Go to yoga three times a week. Her preferred club costs $200/month. • Have a nice dinner out twice a month, around $200/month. • Go on a major vacation every summer; she’ll need $4,000. • Buy a condo or house in the next three years. She’ll need $30,000 for a down payment. • Pay down her credit card debt of $5,000. Her minimum monthly payment is $200. • Pay off her student loans, which have a remaining balance of $11,000. She currently pays $250/ month, and at this rate, she will pay off her loans in five years. • Regularly put aside money for emergencies. • Increase the amount of money she is setting aside for retirement

Tips To Keep In Mind ––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––– • Be aware of the difference between Janella’s wants and her needs. • You won’t be able to meet all of Janella’s financial goals so pick the ones you think are best and make sure you have a reason why. • Be creative!

Green Curriculum: SESSION TWO

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Green Curriculum: SESSION TWO

Janellaâ&#x20AC;&#x2122;s Budget Worksheet

Green Curriculum: SESSION TWO

ARTICLE “Seven Retirement Planning Mistakes Millennials Are Making (And How They Can Get Back On Track)” by Dmitriy Fomichenko, Forbes (Apr. 25, 2019) www.forbes.com/sites/forbesfinancecouncil/2019/04/25/seven-retirement-planning-mistakes-millennials-are-making-and-how-they-can-get-back-on-track/#420472d944f4

The word “millennial” comes with baggage, as the generation is often called impatient and restless. A careful study of research from the past couple years indicates that millennials are not doing so great financially, especially when it comes to retirement planning. I decided to find out the truth behind these claims. Claim 1: Millennials invest in cash-only investment options. For a generation that witnessed the Great Recession and suffered from its economic aftermath, love for cash investments doesn’t come as a surprise. A survey commissioned by Bankrate.com revealed that cash is the favorite long-term investment of millennials, a stark deviation from earlier generations, which prefer stocks over other investment options. Unfortunately, this love for cash would likely leave them short of money during retirement. The survey found that millennials with cash accounts usually earn less than 1.5% returns on their holdings. For a 25-year-old contributing $5,000 toward retirement, cash investments generating 1.5% annually compounded returns would lead to a retirement fund of $271,340 at age 65 versus $1.29 million for investments done in the stock markets yielding 8% annual returns. Claim 2: They tap into 401(k)s early. Research indicates that as many as 60% of investors between 18 and 34 have drawn from their retirement savings for one reason or another. However, it’s unfair to take these figures at face value without considering the reasons for withdrawals. Nearly 23% of these withdrawals were made to pay for emergency medical bills, 22% for education and 17% because of unemployment. These figures hint toward some unique challenges millennials face, such as excessive student debts and unemployment. Claim 3: Millennial workers contribute less to 401(k)s and other retirement plans. Millennials are a little behind in making contributions toward their retirement. According to a report from the National Institute on Retirement Security, almost two-thirds of Millennial workers have no retirement savings. Despite 66% of working millennials having access to an employer-sponsored retirement plan, only one-third participate in them. However, there are additional factors at work here. Nearly 40% of millennials who don’t participate in their employers’ plans said they find it challenging to fulfill the eligibility requirements set forth for participation in the plans. Claim 4: They postpone retirement savings to pay student loans. Research indicates that America has net student debt of $1.5 trillion. Experts have taken the liberty to call it a crisis, which makes sense considering a delinquency rate of nearly 11% for student loans. Although Millennials are not the only generation in this category, they have borrowed the most among the generations. That same research shows that as of 2017, the total number of Americans under 30 with student debt stood at 16.8 million, followed by the age group of 30-39 (12.3 million). What’s even more interesting is that student loans are keeping millennials from contributing to their retirement. Millennials with student debt have average retirement savings of $21,160, which falls short of the average retirement savings of $39,905 by millennials with no student debt. Claim 5: They postpone long-term investments, such as homeownership. A recent report from the Federal Reserve suggests that student debt could be a reason for declining homeownership

Green Curriculum: SESSION TWO

in the age group of 24 to 32. According to the report, between 2005 and 2014, homeownership for this age group dropped from 45% to 36%. It is critical to consider that baby boomers purchased their first house at an average age of 25, nearly 10 years earlier than millennials. Claim 6: Millennials underestimate retirement expenses. One of the major financial mistakes any individual could make is underestimating the cost of retirement, and a 2018 survey indicates that millennials are guilty of committing this mistake. Thirty-four percent of those surveyed in this age group believe they need $200,000 or less to retire comfortably. That is in stark contrast to the $1.18 million estimated by AARP for a retiree withdrawing $40,000 annually for 30 years. Claim 7: They have no emergency fund. Last but not least, millennials arenâ&#x20AC;&#x2122;t doing so well when it comes to saving for emergencies. According to a 2017 report, about 46% of surveyed adults in the 18 to 24 age group had no emergency fund set in place, whereas this figure stood at 41% for those ages 25 to 34. The latter are doing better saving for contingencies. Furthermore, the lack of an emergency fund establishes a relationship between these groups and early 401(k) withdrawals. Millennials still have time to improve their retirement outlook. While many millennials are culpable of making one or more of these financial mistakes, they still have time to make corrections. A good first step in this correction course would be to start investing. One option is to leverage the growth potential of the stock market via low-cost index mutual funds. Another is investing in alternative assets, such as real estate, through self-directed IRA and Solo 401(k) plans. The ideal way to saving for retirement is to identify the financial needs of an individual during their retirement and then create a befitting saving strategy. To save more for retirement, a good place to focus is maxing out current retirement contributions. Self-employed professionals can benefit from the high contribution limits offered by Solo 401(k)s ($56,000 annually). It is also critical to consider retirement savings off limits, which means avoiding dipping into retirement funds when possible. Considering the student loan debt many millennials carry, another helpful strategy is to consult a financial expert and identify how to contribute more toward retirement while repaying student debt. As they save, millennials should also keep in mind the possibility of job loss, emergency medical bills or other financial crunches and start creating an emergency fund. The conventional wisdom recommends an emergency fund that can cover at least three months of household expenses. All of this research indicates that millennials are not only running short of retirement savings but are struggling financially overall. However, they still hold the advantage of time, so they can overcome these financial challenges through sound financial planning. The information provided here is not investment, tax or financial advice. You should consult with a licensed professional for advice concerning your specific situation.

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Green Curriculum: SESSION TWO

After Session 2 Important Activities Before Session 3 Activities During the week ahead, spend some time exploring the following activities before returning for Session 3.

1. If there were any articles or aspects of Session 2 you need to finish please do so before Session 3. 2. Thoroughly review and get to know the key terms below. We want you to remember these long after RTSWS is over and all students will be taking a post-assessment in Session 5 to see how much you’ve learned. So make sure to study these! 3. Spend some time engaging with RTSWS on our social media platforms.

Review of Key Terms from Session 2 1. Fixed Expense Fixed expenses cost the same amount each month. These bills cannot easily be changed and are usually paid on a regular basis, such as weekly, monthly, quarterly or from year to year. 2. Variable Expense Discretionary expenses that vary from one month to the next. These bills can be easily changed. 3. Occasional (or Periodic) Expense Like fixed expenses, these bills generally cannot be easily changed, but do not occur on a regular weekly or monthly basis, making them more challenging to plan for. 4. Retirement Accounts A plan for setting aside money to be spent after retirement. There are different kinds of retirement accounts: 401(k), 403(b), Roth IRA, Traditional IRA. 5. Retirement Accounts The primary difference between an IRA and a 401k is that a 401k plan must be established by an employer. For 401k plans that have employees, the employer has the option of making contributions to the employees' account. An IRA, on the other hand, is an individual account, not tied to an employer. napkinfinance.com/videos/iras-vs-401ks/ 6. Budget A budget is an estimation of revenue and expenses over a specified future period of time and is utilized by governments, businesses, and individuals. Personal budgets are extremely useful in managing an individual's or family's finances over both the short and long periods of time. Short = 1 year, Long = 5-10 years. napkinfinance.com/napkin/invest-money

Green Curriculum: SESSION THREE

Session33Agenda Agenda Session

1. Introduction: Welcome and any new volunteer introductions 2. Learning Objectives and Key Terms • Definitions and visuals are provided in this session for you to review. 3. Review Yahoo! Finance Portfolio 4. Continue Financial Planning Activity: Janella Smith 5. Classroom Discussion: Economic Lessons from COVID-19 6. Important Activities Before Session 4

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Green Curriculum: SESSION THREE

Session 3 Financial Planning for Janella (Part Two)

Learning Objectives 1.1 Work with your group to finalize your recommendations for Janella’s budget. 2.2 Learn the Session 3 Key Terms below. 3.

Learn the effects the coronavirus pandemic had on the capital markets and what lessons we can apply to the future.

Key Terms 1.

Checking Account A checking account is a deposit account held at a financial institution that allows withdrawals and deposits. Also called demand accounts or transactional accounts, checking accounts are very liquid and can be accessed using checks, automated teller machines and electronic debits, among other methods.

Savings Account Savings accounts are offered by banks and credit unions. The money in a savings account is insured by the Federal Deposit Insurance Corporation (FDIC) up to 250,000 per depositer. Restrictions may apply to savings accounts; for example, a service fee may be charged if more than the permitted number of monthly transactions occurs.

Bond A bond is a low-risk debt investment, similar to an IOU, which is issued by companies, municipalities, states and governments to fund projects. When you purchase a bond, you are lending money to one of these entities (known as the issuer). In exchange for the “loan,” the bond issuer pays interest for the life of the bond, and returns the face value of the bond at maturity. Bonds are issued for a specific period at a fixed interest rate. Each bond type involves a varying degrees of risk, as well as returns and maturity periods. It’s important to note that bonds have an inverse relationship to interest rate. When interest rates rise, bond prices fall, and vice-versa.

Loan A loan is money, property, or other material goods given to another party in exchange for future repayment of the loan value or principal amount, along with interest or finance charges. Examples: mortgage, car loan, home renovation, starting a business.

Debt Debt is an amount of money borrowed by one party from another. Debt is used by many corporations and individuals as a method of making large purchases that they could not afford under normal circumstances.

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Green Curriculum: SESSION THREE

Mortgage A mortgage, or deed of trust in some states, is a type of loan you can use to buy or refinance a home. Mortgages are also referred to as “mortgage loans.” Mortgages are a way to buy a home without having all the cash upfront. When you get a mortgage, your lender gives you a set amount of money to buy the home. You agree to pay back your loan – with interest – over a period of several years. You don’t fully own the home until the mortgage is paid off. It’s important to note that the period of years you have to pay back your mortgage will affect your monthly payment and how much interest you will pay in total. For example, a 15-year mortgage will have a higher monthly payment than a 30-year mortgage, but with a 15-year mortgage you will pay less interest since you are paying off your loan in a shorter amount of time.

Stock Market Volatility Stock market volatility in the simplest sense, measures fluctuations in stock prices. Low volatility means small fluctuations and high volatility means large fluctuations. Low volatility can be interpreted as investors being complacent, not worried. High volatility implies an element of fear in investors’ current attitudes. *Source: Investopedia

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ARTICLE

Green Curriculum: SESSION THREE

Classroom Discussion: Economic Lessons from COVID-19 Investopedia, Forbes, Statista

Volatility Explained: • Different events or occurrences like a pandemic can greatly affect the capital markets/stock market and cause volatility in the market • Volatility in the market measures fluctuations in stock prices. Low volatility means small fluctuations and high volatility means large fluctuations. Low volatility can be interpreted as investors being complacent, not worried. High volatility implies an element of fear in investors’ current attitudes. • During volatile times, many investors get spooked and begin to question their investment strategies. This is especially true for novice investors, who can often be tempted to pull out of the market altogether and wait on the sidelines until it seems safe to dive back in. • The thing to realize is that market volatility is inevitable. It's the nature of the markets to move up and down over the short-term. Trying to time the market is extremely difficult. One solution is to maintain a long-term horizon and ignore the short-term fluctuations. Finance Industry and Economy Takeaways: • Due to COVID-19 people all over the world have had to remain quarantined following Stay at Home orders in order to control the overall spread and impact. Due to these drastic measures of containment, there has been a substantial impact on the global economy. • Economic activity has decreased significantly as people are no longer traveling for work or vacation, companies have had to temporarily shut down or close facilities, and Americans aren’t spending as much money. • Uncertainty around the economy lead people to sell their stocks and take their money out of the stock market. This causes the stock prices to drop and the value of the company decreases. However, some stocks did increase because of its use during the coronavirus, such as, Zoom and Clorox. • All of these measures have caused unemployment rates to reach record highs. More than 38 million people filed for unemployment due to the coronavirus, predicted to be nearly 16% by July 2020 – higher than at any point since the Great Depression. This also means there is a severe lack of jobs due to coronavirus. • The US government passed a stimulus bill of roughly 2 trillion dollars to financially support American citizens and companies who are heavily impacted by the pandemic. Personal Finance Lessons: • Make sure to have at least a 3-6 month emergency fund that can cover all of your expenses • Your emergency fund should be saved where it can quickly be liquidated if needed - a bank savings account, CDs, money market accounts, etc. • Create a budget now so you can start saving and investing and also create a crisis budget to be prepared if a financial crisis happens • Don’t let credit card debt build up, this has a high interest rate so this can easily build when you can’t pay this off

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Green Curriculum: SESSION THREE

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Green Curriculum: SESSION THREE

ARTICLE 10 Ways to Prepare for a Personal Financial Crisis By Amy Fontinelle, Investopedia, Updated April, 2020 https://www.investopedia.com/articles/pf/11/prepare-for-a-financial-crisis.asp

The thought of being hit with a major negative event that could affect your finances, such as a job loss, an illness, a car accident—or a pandemic—can keep anyone awake at night. However, the prospect of something expensive and beyond your control happening becomes less threatening if you’re properly prepared. Here are 10 steps for how to deal with an economic crisis. 1. Maximize Your Liquid Savings Cash accounts, such as checking, savings, and money market accounts— as well as certificates of deposit (CD) and short-term government investments—will help you the most in a crisis. You’ll want to turn to these resources first because their value doesn’t fluctuate with market conditions, unlike stocks, index funds, exchange traded funds (ETFs), and other financial instruments in which you might have invested. This means you can take your money out at any time without incurring a financial loss. Also, unlike retirement accounts, you won’t face early withdrawal penalties or incur tax penalties when you withdraw your money, except for CDs, which usually require you to forfeit some of the interest you’ve earned if you close them early. Don’t invest in stocks or other higher-risk investments until you have several months’ worth of cash in liquid accounts. How many months’ worth of cash do you need? It depends on your financial obligations and risk tolerance. If you have a major obligation, such as a mortgage or a child’s ongoing tuition payments, you might want to have more months’ worth of expenses saved up than if you’re single and renting an apartment. A three-month expense cushion is considered a bare minimum, but some folks like to keep six months or even up to two years’ worth of expenses in liquid savings to guard against a long bout of unemployment. 2. Make a Budget If you don’t know exactly how much money you have coming in and going out each month, you won’t know how much money you need for your emergency fund. And if you aren’t keeping a budget, you also have no idea whether you’re currently living below your means or overextending yourself. A budget is not a parent—it can’t and won’t force you to change your behavior—but it is a useful tool that can help you decide if you’re happy with where your money is going and where you stand financially. 3. Prepare to Minimize Your Monthly Bills You might not have to do it now, but be ready to start cutting out anything that is not a necessity. If you can get your recurring monthly expenses as low as they can be, you’ll have less difficulty paying your bills when money is tight. Start by looking at your budget to see where you might currently be spending more money than necessary. For example, are you paying a monthly fee for your checking account? Explore how to switch to a bank that offers free checking. Are you paying $40 a month for a landline you rarely use? Learn how you might cancel it or switch to a lower rate emergency-only plan. You might find ways you can start cutting your costs now just to save money. Maybe you're in the habit of letting the heater or air conditioner run when you’re not home or leaving lights on in rooms you aren’t using. You may be able to trim your utility bills. Now might also be a good time to shop around for lower insurance rates and find out if you can cancel certain types of insurance, such as car insurance, in the event of an emergency. Some insurance companies might give you an extension, so look for the steps involved and be prepared. 4. Closely Manage Your Bills There’s no reason to waste money on late fees or finance charges, yet families do it all the time. During a job loss crisis, you should be extra studious in this area. Simply being organized can save you a lot of money when it comes to your monthly bills. One late credit card payment per month could set you back $300 over the course of a year. It could even get your card canceled at a time when you might need it as a last resort.

Green Curriculum: SESSION THREE

Set a date twice a month to review all your accounts, so you don’t miss any due dates. Schedule electronic payments or mail checks so that your payment arrives several days before it’s due. This way, if a delay occurs, your payment will probably still arrive on time. If you’re having trouble keeping track of all your accounts, start compiling a list. When your list is complete, you can use it to make sure you’re on top of all your accounts and to see if there are any you can combine or close. Don’t neglect your non-cash assets, such as frequent flier miles, credit card rewards points, and gift cards. 5. Take Stock of Your Non-Cash Assets and Maximize Their Value Being prepared might include identifying all of your options. Do you have frequent flyer miles you can use if you need to travel? Do you have extra food in your house that you can plan meals around to lower your grocery bills? Do you have any gift cards you can put toward entertainment or sell for cash? Do you have rewards from a credit card that you can convert to gift cards? All these assets can help you lower your monthly expenses, but only if you know what you have and use it wisely. Knowing what you have can also prevent you from buying things you don’t need. 6. Pay Down Your Credit Card Debt If you have credit card debt, the interest charges you’re paying every month probably take up a significant portion of your monthly budget. If you make it a point to pay down your credit card debt, you will reduce your monthly financial obligations and put yourself in a position to start building a better nest egg. Getting rid of interest payments frees you to put your money toward more important things. 7. Get a Better Credit Card Deal If you’re currently carrying a balance, it could really help you to transfer that balance to another card with a lower rate. Paying less interest means that you can pay off your total debt faster and/or gain some breathing room in your monthly budget. Just make sure that what you save from the lower interest rate is greater than the balance transfer fee. If you’re transferring your balance to a new card with a low introductory annual percentage rate (APR), aim to pay off your balance during the introductory period, before your rate goes up. It's also worth asking if your current credit card company will lower your monthly interest rate. Sometimes companies will do this to keep you as a customer; it's cheaper for them to keep an existing customer than it is to recruit a new one. There are always ways for you to earn extra money, whether it’s selling unneeded possessions, freelancing in your off hours, or even getting a second job. 8. Look for Ways to Earn Extra Cash Everyone has something they can do to earn extra money, whether it’s selling possessions you no longer use (either online or in a garage sale), babysitting, chasing credit card and bank account opening bonuses, freelancing, or getting a second job. The money you earn from these activities may seem insignificant compared to what you earn at your primary job, but even small amounts can add up to something meaningful over time. Besides, many of these activities have side benefits: You might end up with a less cluttered house or discover that you enjoy your side job enough to make it your career. 9. Check Your Insurance Coverage In step three we recommended shopping around for lower insurance rates. If you’re carrying too much insurance—or could be getting the same coverage from another provider for a better price—these are obvious changes you can make to lower your monthly bills. That being said, having excellent insurance coverage can prevent one crisis from piling on top of another. It’s also worth making sure that you have the coverage you really need and not just a bare minimum. This applies to policies you already have, as well as to policies you may need to purchase. A disability insurance policy can be indispensable if you sustain a significant illness or an injury that prevents you from working, and an umbrella policy can provide coverage where your other policies fall short. 10. Keep Up With Routine Maintenance If you keep the components of your car, home, and physical health in top condition, you can catch problems while they’re small and avoid expensive repairs and medical bills later. It’s cheaper to have a cavity filled than to get a root canal, easier to replace a couple of pieces of wood than to have your house tented for termites, and better to eat healthy and exercise than end up needing expensive treatments for diabetes or heart disease. You might think you don’t have the time or money to deal with these things on a regular basis, but they can create much larger disruptions of your time and finances if you ignore them. The Bottom Line Life is unpredictable, but if there’s anything you can do to stave off disaster, it’s to be prepared and careful. With the right preparation you can turn a potential financial tragedy into a merely temporary setback.

Green Curriculum: SESSION THREE

ARTICLE Second half Outlook: Stock market comeback may hit a wall as coronavirus cases spike Patti Domm, CNBC, Jun 24, 2020 https://www.cnbc.com/2020/06/24/second-half-outlook-stock-market-comeback-may-hit-a-wall-as-coronavirus-cases-spike-again.html

Stocks could face turbulence and limited gains in the second half of the year, as the Covid-19 pandemic continues to set the course for markets and the economy. The S&P 500 had been up more than 20% for the second quarter before Wednesday’s 2.6% decline, as a surge in virus cases in Florida, Texas and other sunbelt states raised fears that the economic rebound could be slowed. The first half of the year saw stocks rise to new highs amid optimism after the phase one China trade deal, but then plummet in March, as the virus shut down the economy. But a heavy and rapid dose of fiscal and Fed stimulus pulled markets out of a downward spiral, and the Nasdaq led the pack, as the first index to set new highs. The S&P 500, at 3,050, is still down 5.6% for the year-to-date. With just a week left in the second quarter, the negative news on the virus is a setback and a reminder that the health crisis could continue to dampen economic activity and strain health systems and local government budgets. Some strategists say the market mood is changing, and with the virus spread, the focus may shift to whether and how quickly Congress will approve more economic stimulus. “People who are looking for a magical V [recovery] are delusional,” said Julian Emanuel, head of equities and derivatives strategy at BTIG. “The delusional part is when you look at the Nasdaq, it made a new all time high. That’s buoying the public’s optimism and pulled institutions off the sidelines.” Investors jumped into defensive, stay at home stocks, like Netflix, Facebook, Amazon and consumer staples, when the economy was first shut down. But as they became optimistic about the economy recovering, they moved into the beaten down names, like airlines or casinos, and cyclicals like financials and energy to bet on the rebound. All of those stocks were hit Wednesday, as the Dow fell 710 points, off 2.7% Emanuel said the fact that institutions have put more money into stocks recently means they are no longer underinvested and compelled to buy. “That’s different than what we saw in May and the first several weeks in June,” when they had to chase performance, he said. “We are now no longer in a mindset where good n ews is likely tot be interpreted as good news and bad news is likely to be shrugged off,” said Emanuel. “Bad news will be bad news.” Emanuel expects the S&P to end the year at 3,000, and the market should start setting new highs next year. “The path is going to be extremely volatile. That’s what the VIX above 30 is telling you. Our price target is 3,000. We’re basically going to have a lot of volatility on either side of tat number, and it’s going to be more volatile, not less as we get closer to the election.” The VIX, the CBOE’s Volatility Index, reflects investing in puts and calls in the S&P 500. A higher VIX indicates more volatility, and it jumped more than 7.8% Wednesday to 33.84. Besides the uncertainty surrounding the virus, markets also face uncertainty as the presidential election approaches. Currently, the polls show former Vice President Joe Biden in the lead, ahead of President Donald Trump. Some political strategists believe there is a chance that a strong showing by Biden and the Democrats could result in a blue sweep with Democrats in the White House and both chambers of Congress.

Green Curriculum: SESSION THREE

Ed Keon, chief investment strategist at QMA, said the market may not react to the November election until after the summer. “Four months is a lifetime in politics,” he said. ’“If you actually look at the party of the president, it doesn’t have very much correlation with the stock market, and if anything it suggests that the market does better under Democrats than Republicans. If Democrats take control, you’re going to see some of the tax cuts reversed and that will probably be taken to be negative.” But in the meantime, the prime focus is on the virus and how it is impacting the economy. Besides the news of a jump in cases in the south and California, the governors of New York, New Jersey and Connecticut announced a quarantine for travelers from hot spot states. That slammed airline stocks and raised concerns of a slower economic recovery. “We were already down and that just took us down another leg,” Keon said. “I’ve been reasonably cautious for awhile. we’ve had some moves up and down, but we’ve pretty much been sideways on the S&P for a month plus.” Liz Ann Sonders, Charles Schwab chief investment strategist, said while there’s been a flat trend, the Nasdaq has bucked it in recent weeks. “Although the Nasdaq hit a new high and has been on a spike, less than 50% of its constituents are trading above the 200-day moving average. That’s the biggest divergence since 2001,” she said. “There are 45% of the Nasdaq trading above the 200 day moving average in a a rally that’s been epic.” The 200-day moving average is a technical measure of momentum. It literally is an average of the last 200 closing prices of a stock or an index, and a move above it is seen as positive momentum. “It’s hard to paint a rosy picture when that’s your classic story of the generals advancing and the soldiers falling behind. I think you add the virus stuff to more attention given to these technical divergences and sentiment being stretched and you have a recipe for a pullback,” she said. Sonders said the virus will steer stocks through the end of the year, and even with reopenings, the virus could still influence consumer and corporate behavior. “The market in both directions is impacted by the virus,” she said. She pointed to the fact that in just four sessions when there was positive drug or vaccine news, the Dow gained 2,700 points in just those sessions. “What concerns me is the market has gotten pretty frothy,” she said, noting it’s a positive that the small caps given back some gains. “Investors ares positioned very optimistically,” she said, adding some of the sentiment surveys don’t reflect the level of optimism apparent in investor behavior. “When you get to extremes of sentiment in either direction it often takes less of a catalyst to ignite the naturally contrarian move in the market. That’s what happened in February. I am pleased to see in the last week or two some of the air is coming out of the riskier small cap stocks.”

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Green Curriculum: SESSION THREE

After Session 3 Important Activities Before Session 4 Activities During the week ahead, spend some time exploring the following activities before returning for Session 4. 1.

If there were any articles or aspects of Session 3 you need to finish please do so before Session 4.

Thoroughly review and get to know the key terms below. We want you to remember these long after RTSWS is over and all students will be taking a post-assessment in Session 5 to see how much you’ve learned. So make sure to study these!

Spend some time engaging with RTSWS social media platforms.

Review of Key Terms from Session 3 1.

Checking Account A checking account is a deposit account held at a financial institution that allows withdrawals and deposits. Also called demand accounts or transactional accounts checking accounts are very liquid and can be accessed using checks, automated teller machines and electronic debits, among other methods.

Savings Account Savings accounts are offered by banks and credit unions. The money in a savings account is insured by the Federal Deposit Insurance Corporation (FDIC) up to $250,000 per depositer Restrictions may apply to savings accounts; for example, a service fee may be charged if morethan the permitted number of monthlytransactions occurs.

Bond A bond is a low-risk debt investment, similar to an IOU, which is issued by companies, municipalities, states and governments to fund projects. When you purchase a bond, you are lending money to one of these entities (known as the issuer). In exchange for the “loan,” the bond issuer pays interest for the life of the bond, and returns the face value of the bond at maturity. Bonds are issued for a specific period at a f ixed interest rate. Each bond type involves a varying degrees of risk, as well as returns and maturity periods. It’s important to note that bonds have an inverse relationship to interest rate. When interest rates rise, bond prices fall, and vice-versa. • www.youtube.com/watch?v=tuBDGjSh7ms

Loan A loan is money, property, or other material goods given to another party in exchange for future repayment of the loan value or principal amount, along with interest or finance charges.Examples: mortgage, car loan, home renovation, starting a business. • https://www.investopedia.com/terms/l/loan.asp

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Green Curriculum: SESSION THREE

Mortgage A mortgage, or deed of trust in some states, is a type of loan you can use to buy or refinance a home. Mortgages are also referred to as “mortgage loans.” Mortgages are a way to buy a home without having all the cash upfront. When you get a mortgage, your lender gives you a set amount of money to buy the home. You agree to pay back your loan – with interest – over a period of several years. You don’t fully own the home until the mortgage is paid off. It’s important to note that the period of years you have to pay back your mortgage will affect your monthly payment and how much interest you will pay in total. For example, a 15year mortgage will have a higher monthly payment than a 30-year mortgage, but with a 15-year mortgage you will pay less interest since you are paying off your loan in a shorter amount of time. https://www.investopedia.com/terms/m/mortgage.asp

Stock Market Volatility Stock market volatility in the simplest sense, measures fluctuations in stock prices. Low volatility means small fluctuations and high volatility meanslarge fluctuations. Low volatility can be interpreted as investors being complacent, not worried. High volatility implies an element of fear in investors’ current attitudes. napkinfinance.com/videos/volatility/

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Green Curriculum: SESSION FOUR

Session Session4 4Agenda Agenda

1. Introduction: Welcome and any new volunteer introductions 2. Learning Objectives and Key Terms • Definitions and visuals are provided in this session for you to review. 3. Review Yahoo! Finance Portfolio 4. Risk Tolerance Activity 5. Janella’s Budget Review Activity 6. Important Activities Before Session 5. 7. Get details about upcoming Student Field Trip (if available)

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Green Curriculum: SESSION FOUR

Session 4 Financial Planning for Janella (Part Three) Learning Objectives 1.

Evaluate your group’s budget for Janella, including how fully your plan might help her reach each of her financial goals.

Learn important concepts relevant to saving and investing, including “risk vs. reward” and the power of compound interest. Explore some of the best ways to save and invest. In the process, you should learn the related key terms below.

Key Terms 1.

Investment Risk Tolerance Risk tolerance is the amount of risk that an investor is comfortable taking or the degree of uncertainty that an investor is able to handle. Risk tolerance often varies with age, income, and financial goals. It can be determined by many methods, including questionnaires designed to reveal the level at which an investor can invest but still be able to sleep at night.*

Mutual Fund A mutual fund is a type of financial vehicle made up of a pool of money collected from many investors to invest in securities such as stocks, bonds, money market instruments, and other assets. Mutual funds are operated by professional money managers, who allocate the fund's assets and attempt to produce capital gains or income for the fund's investors. A mutual fund's portfolio is structured and maintained to match the investment objectives stated in its prospectus. Mutual funds trade only once per day after the markets close.*

Venture Capital Venture capital is financing that investors provide to startup companies and small businesses that are believed to have long-term growth potential. Venture capital generally comes from well-off investors, investment banks and any other financial institutions. However, it does not always take a monetary form; it can also be provided in the form of technical or managerial expertise.*

Inflation Inflation is the rate at which the general level of prices for goods and services is rising and, consequently, the purchasing power of currency is falling. Inflation can be viewed positively or negatively depending on the individual viewpoint and rate of change. Those with tangible assets, like property or stocked commodities, may like to see some inflation as that raises the value of their assets. People holding cash may not like inflation, as it erodes the value of their cash holdings. Increasing prices result in your money not going as far as it once did. Maybe you could buy our candy bars with a dollar in 1980, but today you could only buy half of one; that’s inflation. This tcan directly affect your bank accounts, for example, If inflation outpaces the interest you earn on your bank account, it will feel like losing money. Your balance might be increasing, but not enough to keep up with higher prices. Ideally, an optimum level of inflation is required to promote spending to a certain extent instead of saving, thereby nurturing economic growth.

Green Curriculum: SESSION FOUR

5. Interest Interest is the charge for the privilege of borrowing money in other words, you are paying a certain amount for the use of money. Simple interest is a set rate on the principle originally lent to the borrower that the borrower has to pay for the ability to use the money. Example: If you borrow $1,000 (principle) with 10% interest annually. 10% of $1,000 = $100. If you’ve paid nothing on the loan after one year you will owe $1,100. Each year the amount you pay will only go up by the fixed amount of $100. 6. Compound Interest Compound interest is interest on both the principle (starting amount of the loan) and the compounding interest paid on that loan. Example: If you borrow $1,000 (principle) with 10% interest compounded annually. 10% of $1,000 = $100. If you’ve paid nothing on the loan after one year you will owe $1,100 but after the second year you will owe 1,210 because you now have to pay 10% of $1,100 instead of just the principle of $1,000.

*Source: Investopedia

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Green Curriculum: SESSION FOUR

ARTICLE “What Is Risk Tolerance, and Why Is It Important?” by Barbara Marquand, NerdWallet (Nov. 14, 2018) www.nerdwallet.com/blog/investing/what-is-risk-tolerance-and-why-its-important/

Risk tolerance is how much of a loss you're prepared to handle. Your goals, investing timeline and comfort level all factor into the equation. Here’s one sure thing to know about investing: There is no sure thing. Every investment has some level of risk. The more risk you take, the greater the potential returns are — and the greater the potential for losing money. What is risk tolerance? Risk tolerance is the ability to withstand losses when things go south. If you buy stocks, for instance, how much of a drop in the market can you stomach? Knowing your risk tolerance helps create a game plan. In many ways it will drive how you invest, says Marianela Collado, a certified financial planner and co-owner of Tobias Financial Advisors in Plantation, Florida. If your tolerance is low, you’ll invest conservatively. For instance, a greater portion of your portfolio might be in low-risk bonds and a smaller portion in higher-risk stocks. The ingredients of risk tolerance “Everyone’s risk tolerance is going to be different,” says Charlie Horonzy, a certified financial planner and founder of Focused Up Financial in Chicago. Here are some of the determining factors: Goals: The purpose of financial planning isn’t to accumulate the biggest pile of money possible. It’s to decide what you want out of life, calculate how much money you need to reach those goals, and then choose an investment strategy that will deliver the appropriate returns. Timeline: Generally you can take more risk if you have a lot of time to ride out the bumps. “If you’re going to need money in five or 10 years, that’s much different than if you have 15 years or more,” Horonzy says. The stock market’s overall trajectory across decades is upward, but there are dips and plateaus. A 30-year-old who’s saving to retire at 65 has plenty of time to wait those out. But if you’re saving to buy a house in a few years, investing that savings in stocks is too risky because there likely won’t be enough time to recoup losses if the stock market drops. Age and life stage: “If you’re in your 80s, that tolerance can’t be as high as it would be for someone in their 30s,” Collado says. At 30, you’ve got time not only to ride out volatility but to make more money working. Portfolio size: Someone starting retirement with a $5 million portfolio may be able to take more risk than someone with $500,000, Collado says. The person with the larger portfolio has more cushion if values drop. Personal comfort level: Some people are naturally more comfortable with taking risk than others. “I always tell people, ‘You have to be able to sleep at night,’” Collado says. If market volatility is too stressful, that’s a signal that you need to understand better what to expect or to be in less-risky investments, she says. The risks of ignoring risk tolerance Investing without considering risk tolerance is like sleepwalking to the edge of a cliff. Imagine investing in stocks without thinking about how you’ll react if their value drops.

Green Curriculum: SESSION FOUR

“You’re going to get woken up very fast when the market goes down,” Horonzy says. A big danger then is freaking out and fleeing the market. Then “you’re falling into investing mistake No. 1 of selling low,” says Nora Yousif, a certified financial planner and vice president of RBC Wealth Management in Boston. A drop in the market is actually an opportunity to buy because prices are down. Another danger is playing it too safe, Yousif says. You don’t take enough risk to reach goals. Taking a slightly more aggressive position to get better returns can make a huge difference over the long haul. Take a look at the difference a 1% annual return can make for a one-time investment of $100,000 after 35 years: Assessing your risk tolerance Automated investing services called robo-advisors — and human financial advisors alike — have clients fill out questionnaires to help gauge their risk tolerance. (If you’re just starting out or don’t have a lot to invest, a robo-advisor is a low-cost way to get started. See our top picks for robo-advisors.) You answer questions like this one from Vanguard: “During market declines, I tend to sell portions of my riskier assets and invest the money in safer assets.” Possible answers: Strongly disagree, disagree, somewhat agree, agree, strongly agree. Answer questions about risk honestly — not as you think a smart investor would. Take risk seriously Besides evaluating questionnaire answers, human financial planners say they spend a lot of time talking about risk so clients don’t get caught off guard when values drop. “No one gripes about the value going up,” Yousif says. But it’s natural to wince when the market goes down and your portfolio shrinks. She stresses the normality of stock market volatility and helps clients mentally prepare so they can hang on when things get bumpy. “It’s one thing to guess how you’re going to handle a loss, and it’s another thing to assess after you’ve lost 12%,” Yousif says. She converts percentages to actual dollars when talking about what to expect if the market drops. “That tends to get people’s attention.” Take our quick risk tolerance quiz to begin exploring your attitude about risk-taking. The quiz isn’t intended to guide investment choices — you’ll need to consider your goals, timeline and other factors before making investment decisions — but it can give you insight into your natural tendencies.

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Green Curriculum: SESSION FOUR

ACTIVITY - Janella’s Budget Review

Gather with your group to go over the budget and investment plan that you created for Janella. As you do, complete the following activities and answer these questions:

What was most difficult in making choices regarding Janella’s budget?

If Janella is saving or investing, what type of account or investment would your group recommend for her to save money? To invest? Why?

As a group, go online and take The Motley Fool’s Risk Tolerance Quiz for Janella and review the results with your group’s recommendations. Find the quiz (dated May 21, 2017) via Google search for “motley fool risk tolerance quiz”. The actual web address is: https://www.fool.com/retirement/2017/05/21/whats-your-investment-style-take-this-risk-toleran.aspx

Consider the article “Investments for Beginners” (on the following page). Based on your group’s recommendation, how much will Janella have saved or invested, and by when? Turn to the article “What Compound Interest Means for Your Savings” (also on the following pages) to help you calculate Janella’s future balance.

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Green Curriculum: SESSION FOUR

ARTICLE “Investments for Beginners” (excerpts) by Arielle O’Shea, NerdWallet (May 21, 2019) www.nerdwallet.com/blog/investing/investments-for-beginners/

There are plenty of investment options for beginner investors, including mutual funds and robo-advisors. The biggest misconception about investing is that it’s reserved for the rich. That might’ve been true to some extent 10 years ago. But that barrier to entry is gone today, knocked down by companies and services that have made it their mission to make investment options available for everyone, including beginners and those who have just small amounts of money to put to work. In fact, with so many investments now available to beginners, there’s no excuse to skip out. And that’s good news, because investing is the best way to grow your wealth. Six ideal investments for beginners Here are six investments that are well-suited for beginner investors. 1. A 401(k) or other employer retirement plan If you have a 401(k) or another retirement plan at work, it’s very likely the first place you should put your money — especially if your company matches a portion of your contributions. That match is free money and a guaranteed return on your investment. You can contribute up to $19,000 to a 401(k) in 2019 (or $25,000 if you’re 50 or older), but that doesn’t mean you have to contribute that much. The beauty of a 401(k) is that there typically isn’t an investment minimum. That means you can start with as little as 1% of each paycheck, though it’s a good idea to aim for contributing at least as much as your employer match. For example, a common matching arrangement is 50% of the first 6% of your salary you contribute. To capture the full match in that scenario, you would have to contribute 6% of your salary each year. But you can work your way up to that over time. When you elect to contribute to a 401(k), the money will go directly from your paycheck into the account without ever making it to your bank. Most 401(k) contributions are made pretax. Some 401(k)s today will place your funds by default in a targetdate fund — more on those below — but you may have other choices. Here’s how to invest in your 401(k). To sign up for your 401(k) or learn more about your specific plan, contact your HR department. 3. Target-date mutual funds These are kind of like the robo-advisor of yore, though they’re still widely used and incredibly popular, especially in employer retirement plans. Target-date mutual funds are retirement investments that automatically invest with your estimated retirement year in mind. Let’s back up a little and explain what a mutual fund is: essentially, a basket of investments. Investors buy a share in the fund and in doing so, they invest in all of the fund’s holdings with one transaction. A professional manager typically chooses how the fund is invested, but there will be some kind of general theme: For example, a U.S. equity mutual fund will invest in U.S. stocks (also called equities). A target-date mutual fund often holds a mix of stocks and bonds. If you plan to retire in 30 years, you could choose a targetdate fund with 2050 in the name. That fund will initially hold mostly stocks since your retirement date is far away, and stock returns tend to be higher over the long term. Over time, it will slowly shift some of your money toward bonds, following the general guideline that you want to take a bit less risk as you approach retirement.

Green Curriculum: SESSION FOUR

4. Index funds Index funds are like mutual funds on autopilot: Rather than employing a professional manager to build and maintain the fund’s portfolio of investments, index funds track a market index. A market index is a selection of investments that represent a portion of the market. For example, the S&P 500 is a market index that holds the stocks of roughly 500 of the largest companies in the U.S. An S&P 500 index fund would aim to mirror the performance of the S&P 500, buying the stocks in that index. Because index funds take a passive approach to investing by tracking a market index rather than using professional portfolio management, they tend to carry lower expense ratios — a fee charged based on the amount you have invested — than mutual funds. But like mutual funds, investors in index funds are buying a chunk of the market in one transaction. Index funds can have minimum investment requirements, but some brokerage firms, including Fidelity and Charles Schwab, offer a selection of index funds with no minimum. That means you can begin investing in an index fund for less than $100. 5. Exchange-traded funds ETFs operate in many of the same ways as index funds: They typically track a market index and take a passive approach to investing. They also tend to have lower fees than mutual funds. Just like an index fund, you can buy an ETF that tracks a market index like the S&P 500. The main difference between ETFs and index funds is that rather than carrying a minimum investment, ETFs are traded throughout the day and investors buy them for a share price, which like a stock price, can fluctuate. That share price is essentially the ETF’s investment minimum, and depending on the fund, it can range from under $100 to $300 or more. Because ETFs are traded like a stock, brokers often charge a commission to buy or sell them. But many brokers, including the ones on this list of the best ETF brokers, have a selection of commission-free ETFs. If you plan to regularly invest in an ETF — as many investors do, by making automatic investments each month or week — you should choose a commissionfree ETF so you aren’t paying a commission each time. (Here’s some background about commissions and other investment fees.) 6. Investment apps Several investing apps target beginner investors. One is Acorns, which rounds up your purchases on linked debit or credit cards and invests the change in a diversified portfolio of ETFs. On that end, it works like a robo-advisor, managing that portfolio for you. There is no minimum to open an Acorns account, and the service will start investing for you once you’ve accumulated at least $5 in round-ups. You can also make lump-sum deposits. Acorns charges $1 a month for a standard investment account and $2 a month for an individual retirement account. Our unsolicited advice: Max out that IRA account before you start using the standard investment account — there are tax perks to the IRA that you don’t want to miss. (Learn more about IRAs here.) Another app option is Stash, which helps teach beginner investors how to build their own portfolios out of ETFs and individual stocks. Stash carries just a $5 account minimum and has a similar fee structure to Acorns, though balances that top $5,000 are charged 0.25% of that balance per year, rather than the flat fee.

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Green Curriculum: SESSION FOUR

ARTICLE What Compound Interest Means For Your Savings by Investopedia (Nov. 19, 2018) www.ally.com/do-it-right/banking/what-is-compound-interest-and-how-does-it-work/

Remember that old movie line, “I wish I had a dime for every dime I had”? Whether you’re adding money to a high-yield savings account or socking it away in a certificate of deposit (CD), you want it to grow. That’s where compound interest comes in. It’s a simple—yet powerful—tool for making your dollars and cents add up faster. What is compound interest? The easiest way to think of compound interest is this: it’s interest you earn on your initial principal and your accumulated interest. For example, say you deposit a set amount of money in a savings account or CD. Your initial deposit earns interest, then each time the interest compounds, you earn interest on the principal and on the interest you’ve already accrued. Sounds good, right? Interest can be compounded daily, monthly, quarterly, or annually, depending on where you’re keeping your savings. The more often interest compounds, the faster your money grows. Compound interest is different from simple interest, which is a set percentage of interest you earn on a deposit account each year. How to calculate compound interest For math lovers, there’s a specific compound interest formula you can use to calculate compound interest on savings. It looks like the image to the right. If that seems too complicated, the easiest way to calculate compound interest is to plug the numbers into a compound interest calculator. With a calculator, you’ll easily be able to see how interest compounded daily compares with interest compounded annually or monthly. The great thing about using a calculator is that you can run different scenarios to see how much interest you can earn, based on different compounding frequencies, interest rates, and deposit amounts. How compound interest impacts your savings Compound interest helps you grow your money and it can make a huge difference, whether you’re saving large or small amounts. Let’s look at the following example on the right of a $1000 initial deposit (amounts rounded to the nearest dollar): In this example the amounts are small, but you get the idea. With larger deposits over a longer period of time, that compounding effect can really add up. What determines compound interest? As you can see from the examples above, the interest rate is a major factor in calculating compound interest, but it doesn’t tell the full story. When you’re shopping around for a savings account or a CD, for instance, you should compare the APYs. The APY, or annual percentage yield, gives you a better idea of your potential earnings because it takes the frequency of compounding into consideration. At Ally Bank, we compound interest daily, which can give your savings an advantage over deposit accounts that compound interest just quarterly or annually. That means, in time, you really might just have a dime for every dime you have.

Green Curriculum: SESSION FOUR

After Session 4 Important Activities Before Session 5 Activities During the week ahead, spend some time exploring the following activities before returning for Session 5. 1. If there were any articles or aspects of Session 4 you need to finish please do so before Session 5. 2. Study session 4 key terms and the post-assessment review sheet with all key terms from sessions 1 through 4. All students will be taking the post assessment next session to see how much youâ&#x20AC;&#x2122;ve learned!Â 3. Spend some time engaging with RTSWS on our social media platforms.

Review of Key Terms from Session 4 1. Inflation Inflation is the rate at which the general`level of prices for goods and services is rising and, consequently, the purchasing power of currency is falling. Inflation can be viewed positively or negatively depending on the individual viewpoint and rate of change. Those with tangible assets, like property or stocked commodities, may like to see some inflation as that raises the value of their assets. People holding cash may not like inflation, as it erodes the value of their cash holdings. Increasing prices result in your money not going as far as it once did. Maybe you could buy our candy bars with a dollar in 1980, but today you could only buy half of one; that's Inflation. This can directly affect your bank accounts, for example, If inflation outpaces the interest you earn on your bank account, it will feel like losing money. Your balance might be increasing, but not enough to keep up with higher prices. Ideally, an optimum level of inflation is required to promote spending to a certain extent instead of saving, thereby nurturing economic growth. napkinfinance.com/videos/inflation/ 2. Investment Risk Tolerance Risk tolerance is the amount of risk that an investor is comfortable taking or the degree of uncertainty that an investor is able to handle. Risk tolerance often varies with age, income, and financial goals. It can be determined by many methods, including questionnaires designed to reveal the level at which an investor can invest but still be able to sleep at night.* 3. Mutual Fund A mutual fund is a type of financial vehicle made up of a pool of money collected from many investors to invest in securities such as stocks, bonds, money market instruments, and other assets. Mutual funds are operated by professional money managers, who allocate the fund's assets and attempt to produce capital gains of income for the fund's investors. A mutual fund's portfolio is structured and maintained to match the investment objectives stated in its prospectus. Mutual funds trade only once per day after the markets close.* www.investopedia.com/terms/mmutualfund.asp

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Green Curriculum: SESSION FOUR

4. Venture Capital Venture capital is financing that investors provide to startup companies and small businesses that are believed to have longterm growth potential. Venture capital generally comes from well-off investors, investment banks and any other financial institutions. However, it does not always take a monetary form; it can also be provided in the form of technical or managerial expertise.* www.investopedia.com/terms/venturecapital.asp

5. Interest Interest is the charge for the privilege of borrowing money in other words, you are paying a certain amount for the use of money. Simple interest is a set rate on the principle originally lent to the borrower that the borrower has to pay for the ability to use the money. Example: If you borrow $1,000 (principle) with 10% interest annually. 10% of $1,000 = $100. If youâ&#x20AC;&#x2122;ve paid nothing on the loan after one year you will owe $1,100. Each year the amount you pay will only go up by the fixed amount of $100. napkinfinance.com/videos/interest-rate/ 6. Compound Interest Compound interest is interest on both the principle (starting amount of the loan) and the compounding interest paid on that loan. Example: If you borrow $1,000 (principle) with 10% interest compounded annually. 10% of $1,000 = $100. If youâ&#x20AC;&#x2122;ve paid nothing on the loan after one year you will owe $1,100, but after the second year you will owe 1,210 because you now have to pay 10% of $1,100 instead of just the principle of $1,000. napkinfinance.com/videos/compound-interest/

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Green Curriculum: SESSION FOUR

ACTIVITY - Post-Assessment Review Sheet Study these terms below for the post-assessment quiz. For a visual reference of the terms below, please go to www.rockthestreetwallstreet.com/green-reference

1. Saving Saving is setting aside money you don’t spend now for emergencies or for a future purchase. It’s money you want to be able to access quickly, with little or no risk, and with the least amount of taxes. 2. Investing Investing is buying assets such as stocks, bonds, mutual funds or real estate with the expectation that your investment will make money for you. Investments usually are selected to achieve long-term goals. Generally speaking, investments can be categorized as income investments or growth investments. 3. Stock A share of ownership in a business or corporation. Companies sell shares as a way to raise capital. 4.4 Exchange Traded Fund (ETF) An exchange-traded fund (ETF) is a collection of securities—such as stocks—that tracks an underlying index. The best-known example is the SPDR S&P 500 ETF (SPY), which tracks the S&P 500 Index. ETFs can contain many types of investments, including stocks, commodities, bonds, or a mixture of investment types. An exchange-traded fund is a marketable security, meaning it has an associated price that allows it to be easily bought and sold. The price of an ETF’s shares will change throughout the trading day as the shares are bought and sold on the market. 5. Fixed Expense Fixed expenses cost the same amount each month. These bills cannot easily be changed and are usually paid on a regular basis, such as weekly, monthly, quarterly or from year to year. 6. Variable Expense Discretionary expenses that vary from one month to the next. These bills can be easily changed. 7. Occasional (or Periodic) Expense Like fixed expenses, these bills generally cannot be easily changed, but do not occur on a regular weekly or monthly basis, making them more challenging to plan for. 8. Budget A budget is an estimation of revenue and expenses over a specified future period of time and is utilized by governments, businesses, and individuals. Personal budgets are extremely useful in managing an individual's or family's finances over both the short and long periods of time. Short = 1 year, Long = 5-10 years. 9. Retirement Accounts A plan for setting aside money to be spent after retirement. There are different kinds of retirement accounts: 401(k), 403(b), Roth IRA, Traditional IRA. 10. Checking Account A checking account is a deposit account held at a financial institution that allows withdrawals and deposits. Also called demand accounts or transactional accounts, checking accounts are very liquid and can be accessed using

Green Curriculum: SESSION FOUR

11.

Savings Account Savings accounts are offered by banks and credit unions. The money in a savings account is insured by the Federal Deposit Insurance Corporation (FDIC) up to $250,000 per depositer. Restrictions may apply to savings accounts; for example, a service fee may be charged if more than the permitted number of monthly transactions occurs.

12.1 Bond A bond is a low-risk debt investment, similar to an IOU, which is issued by companies, municipalities, states and governments to fund projects. When you purchase a bond, you are lending money to one of these entities (known as the issuer). In exchange for the “loan,” the bond issuer pays interest for the life of the bond, and returns the face value of the bond at maturity. Bonds are issued for a specific period at a fixed interest rate. Each bond type involves a varying degrees of risk, as well as returns and maturity periods. It’s important to note that bonds have an inverse relationship to interest rate. When interest rates rise, bond prices fall, and vice-versa. 13.1 Loan A loan is money, property, or other material goods given to another party in exchange for future repayment of the loan value or principal amount, along with interest or finance charges. Examples: mortgage, car loan, home renovation, starting a business 14.1 Debt Debt is an amount of money borrowed by one party from another. Debt is used by many corporations and individuals as a method of making large purchases that they could not afford under normal circumstances. 15.1 Mortgage A mortgage, or deed of trust in some states, is a type of loan you can use to buy or refinance a home. Mortgages are also referred to as “mortgage loans.” Mortgages are a way to buy a home without having all the cash upfront. When you get a mortgage, your lender gives you a set amount of money to buy the home. You agree to pay back your loan – with interest – over a period of several years. You don’t fully own the home until the mortgage is paid off. It’s important to note that the period of years you have to pay back your mortgage will affect your monthly payment and how much interest you will pay in total. For e xample, a 15-year mortgage will have a higher monthly payment than a 30-year mortgage, but with a 15year mortgage you will pay less interest since you are paying off your loan in a shorter amount of time. 16.

17.

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18.3 Mutual Fund A mutual fund is a type of financial vehicle made up of a pool of money collected from many investors to invest in securities such as stocks, bonds, money market instruments, and other assets. Mutual funds are operated by professional money managers, who allocate the fund's assets and attempt to produce capital gains or income for the fund's investors. A mutual fund's portfolio is structured and maintained to match the investment objectives stated in its prospectus. Mutual funds trade only once per day after the markets close. 19.

20.0 Inflation Inflation is the rate at which the general level of prices for goods and services is rising and, consequently, the purchasing power of currency is falling. Inflation can be viewed positively or negatively depending on the individual viewpoint and rate of change. Those with tangible assets, like property or stocked commodities, may like to see some inflation as that raises the value of their assets. People holding cash may not like inflation, as it erodes the value of their cash holdings. Increasing prices result in your money not going as far as it once did. Maybe you could buy four candy bars with a dollar in 1980, but today you could only buy half of one; that's Inflation. This can directly affect your bank accounts, for example, If inflation outpaces the interest you earn on your bank account, it will feel like losing money. Your balance might be increasing, but not enough to keep up with higher prices. Ideally, an optimum level of inflation is required to promote spending to a certain extent instead of saving, thereby nurturing economic growth. 21.2 Interest Interest is the charge for the privilege of borrowing money in other words, you are paying a certain amount for the use of money. Simple interest is a set rate on the principle originally lent to the borrower that the borrower has to pay for the ability to use the money. Example: If you borrow $1,000 (principle) with 10% interest annually. 10% of $1,000 = $100. If you’ve paid nothing on the loan after one year you will owe $1,100. Each year the amount you pay will only go up by the fixed amount of $100. 22.2 Compound Interest Compound interest is interest on both the principle (starting amount of the loan) and the compounding interest paid on that loan. Example: If you borrow $1,000 (principle) with 10% interest compounded annually. 10% of $1,000 = $100. If you’ve paid nothing on the loan after one year you will owe $1,100, but after the second year you will owe 1,210 because you now have to pay 10% of $1,100 instead of just the principle of $1,000.

RockTheStreetWallStreet.com | Moving Girls Forward in the Field of Finance

Green Curriculum: SESSION FIVE

Session5 5 Agenda Session Agenda 1. Introduction: Welcome and any new volunteer introductions 2. Learning Objectives 3. Post-Assessment • Remember this is only so we can see how much you’ve learned! We will not show your results to your school or the volunteers. • Take your time to answer and remember we give out prizes for top scores! 4. Review Yahoo! Finance Portfolio 5. Financial Planning Presentations for Janella Sims 6. Discuss the Upcoming Field Trip 7. Review the Resources Page

RockTheStreetWallStreet.com | Moving Girls Forward in the Field of Finance

Green Curriculum: SESSION FIVE

Session 5 Post-Assessment and Financial Planning Presentations Learning Objectives 1.

Complete the RTSWS post-assessment to help us evaluate the impact of our program and see how much students have learned in Sessions 1 through 4, including FINRA Terms.

Each group presents their investment recommendations for Janella to the entire class.

In anticipation of the upcoming field trip, explore and discuss possible future career paths in the world of finance and the strengths the students could bring to the industry as women.

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Green Curriculum: SESSION FIVE

ARTICLE Best Jobs for Graduates with a Finance Degree by Mike Profita, The Balance (Apr. 5, 2019) https://www.thebalancecareers.com/top-jobs-for-finance-majors-2064048

Finance majors learn about a variety of investment vehicles, and this knowledge can help financial planners to advise clients about how to manage their finances. Finance majors can decipher trends in the securities markets and apply this perspective to their planning sessions. Financial planners must crunch numbers and apply principles of accounting in order to devise plans suitable for individual investors. They also need to inspire trust in people and promote their services. Therefore, finance majors with strong interpersonal skills and persuasive abilities will be most likely to succeed in this profession. Salary and Employment Outlook: According to the Bureau of Labor Statistics (BLS), personal financial advisors earned an average of $90,640 in May 2017 and jobs are predicted to expand at a much faster than average rate of 15% through 2026. 2. Financial Analyst Financial analysts research stocks, bonds, companies, and industries to assist bankers, investors, and corporate finance officers with mergers, acquisitions, and stock/bond offerings, as well as corporate expansions and restructuring. They can capitalize on their finance major training as they dissect financial statements and other financial data. Financial analysts build financial models and conduct complex quantitative analyses. Financial analysts also produce reports detailing their findings and present their analyses to other members of the banking or finance team. Salary and Employment Outlook: According to the BLS, financial analysts earned an average of $84,300 in May 2017 and jobs are predicted to grow at a faster than average rate of 11% through 2026. 3. Investor Relations Associate Finance majors with strong writing, organizational, and communication skills can thrive in this role. Investor relations professionals prepare and present financial information about their company or corporate clients to investors, analysts, and business media. Investor relations professionals must digest, interpret, highlight, and present information from financial statements. The analytical and software tools developed through their finance major training facilitate this process. Salary and Employment Outlook: According to Payscale, investor relations associates earn an average salary of $64,352. 4. Budget Analyst Budget analysts apply principles of finance to projects and proposals in the business, educational, governmental, and not-for-profit sectors. They analyze budgets and evaluate the financial impact of continuing ventures and new ventures. Budget analysts must have refined communication skills because they interview managers in order to gather information for proposals. They also train staff regarding the budget development processes for their organization. Finance majors develop the essential analytical and communication skills needed to become a successful budget analyst. Salary and Employment Outlook: According to the BLS, budget analysts earned an average of $75,240 in May 2017 and jobs are predicted to grow by as much as 7% on average through 2026.

Green Curriculum: SESSION FIVE

5. Actuary Actuaries play a leadership role in financially oriented businesses such as insurance, banking, rating agencies, and accounting firms. The finance graduate with strong mathematical skills is ideally positioned to calculate the likelihood of various events and to assess the financial consequences for those outcomes. Just like the finance major, actuaries manipulate software to perform calculations and represent their findings. They present their recommendations to managers at their firm and convince others of the soundness of their decisions. Salary and Employment Outlook: According to the BLS, actuaries earned an average of $101,560 in May 2017 and jobs are predicted to grow at a much faster than average rate of 22% through 2026. 6. Accountant Finance majors learn to construct, interpret, and critique financial statements while completing the accounting component of their studies. Thus, they become capable of carrying out complex accounting work in financially oriented industries. â&#x20AC;&#x153;Best Jobs for Graduates With a Finance Degreeâ&#x20AC;? by Mike Profita, The Balance retrieved from: https:// www.thebalancecareers.com/top-jobs-for-finance-majors-2064048 Students of finance develop a number of accountancy skills as they learn to analyze business problems with precision and attention to detail, which prepares them for the world of accounting. Just like accountants, finance majors learn to present financial information to clients and colleagues by using charts, graphs, and other visual aids. Entry level accounting jobs can be gateway jobs leading to corporate financial management positions, or leadership positions with non-profits and government agencies. Salary and Employment Outlook: According to the BLS, accountants earned an average of $69,350 in May 2017 and jobs are predicted to grow at a faster than average rate of 10% through 2026. 7. Credit Analyst Credit analysts evaluate the financial standing of loan prospects and assess the risks involved with offering them financing. Finance majors learn to appraise the financial viability of entities and interpret their financial records and data. The investigative mindset of a finance major would enable the credit analyst to scrutinize the legitimacy of financial information furnished by clients. Finance majors analyze trends in industries that can impact the ability of organizations to generate the income necessary to repay loans. They have the communication skills necessary for credit analysts to extract information from prospective clients and convey their analyses to colleagues. Salary and Employment Outlook: According to the BLS, credit analysts earned an average of $71,290 in May 2017 and jobs are predicted to grow by as much as 8% on average through 2026. 8. Attorney Lawyers in many areas of practice, including divorce, product liability, civil litigation, corporate, labor, and securities law, benefit from a knowledge of finance. Attorneys who investigate financial irregularities must read and understand financial statements. Lawyers in civil cases need the skills to estimate appropriate compensation for settlements. Research and analytical skills developed by finance majors enable attorneys to prepare their cases. Presentation skills and knowledge of presentation software help attorneys to deliver arguments and prepare exhibits. Salary and Employment Outlook: According to the BLS, lawyers earned an average of $119,250 in May 2017 and jobs are predicted to grow by as much as 8% on average through 2026.

Green Curriculum: SESSION FIVE

9. Commercial Real Estate Agent Finance majors with strong verbal skills and a sales orientation should consider a career as a commercial real estate agent. Commercial real estate agents analyze the business plans and financial status of clients in order to recommend appropriate spaces for their enterprises. When listing a property, brokers must estimate the value of the property based on its financial potential for prospective buyers. Agents advise clients about options for financing property acquisitions and launching new businesses. Salary: According to Payscale, commercial real estate agents earn an average salary of about $94,500. 10. Business Teacher Finance majors hone the communication and presentation skills that are essential to the teaching profession. Business teachers tap a broad knowledge of business as they instruct high school students about the fundamentals of accounting, management, marketing, and investments. Finance majors with an intense curiosity about the business world and an enthusiasm for business issues are well suited for this role. Individuals who earn advanced degrees in business can also pursue teaching jobs at junior and four-year colleges. Salary: According to Payscale, business teachers earn an average salary of $41,654.

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Resources We hope that your experience this semester in RTSWS’s five workshop sessions has been a positive and enriching one. Here are some ways to continue growing in the weeks, months and years ahead.

WE SUGGEST… 1.

Connecting with our LinkedIn Group: Rock The Street, Wall Street - Students and Alumnae. We share potential job shadowing opportunities, summer or college internship opportunities, job opportunities, and other great resources and information related to the Finance Industry and female empowerment in this group. Please email info@rockthestreetwallstreet.com your name and personal emai address so we can contact you with internship and job opportunities while you are in college. Also, ask friends, family members and anyone you meet in the financial field about possible job shadowing and internship opportunities. These will be strong additions to your resume and give you firsthand experience in the field.

Checking out the Rock The Street, Wall Street website where you can find lists of reference sources for careers in finance and more.

Seeking out podcasts, books, websites, online courses or videos about finance, savings, investing and the economy. Here are a few relevant podcasts with hundreds of episodes to explore: NPR’s Planet Money, The Fairer Cents: Women, Money and the Fight to Break Even, So Money with Farnoosh Torabi, The College Investor Audio Show.

WEBSITES Rock The Street, Wall Street • www.rockthestreetwallstreet.com Career Girls • www.careergirls.org Girls Who Invest- http://www.girlswhoinvest.org Napkin Finance • www.napkinfinance.com Keep your eyes and ears on the financial markets through sources such as CNBC and The Wall Street Journal

GENERAL Private Equity/Venture Capital: Consider courses in Entrepreneurship which teach basics about how to start a business, budgets, etc. • If you are more quantitative and technically inclined, consider majors in math and careers in quantitative analysis - good preparation for analyst positions in fixed income, credits, hedge funds, etc. • Do a Google search on “College Majors for Financial Careers” - there are useful websites on college, general articles, etc.