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					      Mind Over Money
                        A common sense approach

Jeff Turnbull
Student Financial Aid

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How much will I pay in tuition?

 Missouri Resident             Non-Missouri Resident
     $71,120                           $85,432 or $96,836

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Education Debt

 Most graduates have student loans
 You’re not alone
 Fear

     Q. What was the average student loan debt for the class of 2010?

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 Loan Basics
     Keep track of your loan information
     Have loan docs in a single place. It helps with


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  National Student Loan Data System

       Dept. of Ed’s central database for student
       Current lender
       Loan servicer
       Outstanding principal balance (OPB)

NSLDS is not real-time data, and non-federal loans are not listed on
the NSLDS website.
Note: For private student loan information, review your credit report.

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Summer Financial Aid

 Loans are available
 Amount ? - last year $3,500
 Grad PLUS for some – credit based

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                  • Loans
                  • Free blocks
                  • Financial aid refunds
                  • Costs
                  • Repayment
                  • Consolidation

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Monthly Payment Estimates
Federal Stafford Loans with 6.8% interest

Loan amount of $50k               Loan amount of $95k
10-year payment - $575            10-year payment - $1,093
25-year payment - $347            25-year payment - $659

Federal Grad PLUS loan with 7.9% interest

Loan amount of $30k
10-year payment = $345                     IBR
20-year payment = $208           

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True or False
Rudy, my Golden Retriever was featured in the
textbook Companion Animals, by Dr. Karen
Campbell and Dr. John Campbell.


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Financial Planning
 Live on a budget

 Have an emergency fund

 Pay off debt and live debt free

 Plan for and expect a rainy day,
   it’s gonna rain.

 Invest and save for retirement

 Pay off your house early

 Give to those that are less

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Financial Responsibility

 You are responsible for your future.
 Strive to make wise personal financial
 Harness the power of compounding.

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Building Blocks

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Where Do I Begin?

                               What you own and
                                what you owe.

                               What you earn and
                                what you spend.

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 Reaching Your Goals Through Budgeting

Your Spending / Savings Action Plan

  Your financial success is largely a matter of choice, not chance.

  Your budget is where you make and implement those choices.

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  Action Before:
Step 1. Set Goals

Your spending plan (budget) has three stages: before, during, and after

         Long-term goals – more than 5 years.

         Intermediate-term goals – 3-5 years.

         Short-term goals – less than 1 year.

      Remember to prioritize your goals.

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 Action Before:
Step 2. Estimate And Revise Your Budget

    Take Home Pay – called your disposable income.

    Discretionary Income – money left after necessities are paid.

            Don’t worry, your spending won’t conform to your

            You must reconcile your needs and wants so total
           expenses do not exceed your income.

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 Action Before:
Step 3. Plan Your Cash Flow

      Before the month begins.
      Income is usually constant month after month
      Expenses may rise – car insurance, taxes, etc.

 1. Use a cash-flow calendar to eliminate anxiety.
 2. Use a revolving savings fund. – borrowing from yourself

        Effective budgeting may involve curtailing your expenses. Borrow from
                         yourself to meet budget deficits later!

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 Action During:
Step 4. Control Spending

     Monitor your categories
     Debit cards – track online
     Use Cash
                         For some, CASH is King.
                             It helps to control

                                  The Envelope System
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 Action After:
Step 5. How Am I Doing?

      Evaluate at the end of each budgeting cycle.
      Gives feedback to use for the next cycle.

  This is done by comparing actual amounts with budgeted amounts.

               Evaluating will assess your
            progress in meeting your financial

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How many years has the
  Labrador Retriever
  been the number 1
  most popular dog in

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  Carry surpluses forward
  Put into savings
  Build a CASH reserve
  Blow money

                Pay down

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Budget Busters
 Car Payments
 Credit Cards
 Clothing   - Sadie and Kayla

 Electronics     - law student story

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Did You Know?

The Top 3 Financial Mistakes In Budgeting

  1.   Fail to plan for non-monthly expenses.

  2.   Underestimate how much they spend each month.

  3.   Use credit cards to balance their budgets.

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                                                  I’m gonna
 Words Of Wisdom                                need a bigger

      Look at your
   personal finances
 like a company. You                                        If you were the
   are in business to                                        chief financial
     make a profit!                                      officer of YOU INC,
                                                         would you fire you?

Your Net Gain
     Your household is like a company. You want to make a profit.

Your Net Loss
     You will need to borrow money or take money from savings to
     make ends meet.

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Major Purchases
Planned Buying – think about the details & do you homework

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How To Buy Smart
 Don’t buy on impulse
 Pay cash
 Buy at the right time
 Do not pay extra for a “name”
 Recognize the high price of convenience

   When buying a car, negotiate effectively and decide at home.
   1. Arm yourself with information.
   2. Negotiate your price.
   3. When negotiating a vehicle purchase, the key is to obtain
      a firm price before any aspects of the deal.
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Auto Buying
1.   Rule #1, don’t mention financing or trade until you have the
     salesperson down to a price.
2.   You will know from your pre-shopping research what a good
     price is.
3.   Start your haggling from your “good price” rather than the
     asking price or sticker price.
4.   Obtain prices from three or more dealers and let each one
     know that you have done so.
5.   This pressures the dealer to meet your needs rather than the
     other way around.
6.   Pay Cash

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The Top Financial Missteps In
Big-Ticket Purchases
 People slip up in purchasing vehicles and other big-ticket
 items when they do the following:

 1.   Rely upon the seller as their source of information for
      price, financing terms, and/or trade-in value.

 2.   Tell a seller what they can afford to pay (because the
      seller can then avoid disclosing their lowest price).

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Should You Rent or Buy
 Depends on your preferences.
 What you can afford.

Note: In the short run, renting is usually less expensive, in the long
run, the opposite is true.

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Buying a Home
In the next five years:
1.   Save the funds for a down payment within a tax-sheltered Roth IRA
2.   Get your finances in order before shopping for a new home by
     reducing debt, budgeting better, and clearing up anything that keeps
     you from having a high credit score.
3.   Buy a home as soon as it fits your budget and life-style so you can
     take advantage of special income tax deductions and price
     appreciation over time.
4.   If you make a down payment of less than 20 percent on a home,
     cancel private mortgage insurance as soon as the equity in your
     home pushes the loan-to-value ratio to 80 percent.

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Steps in the Process of Buying a Home

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Your Credit Score Affects Your Mortgage Interest Rate

Example: Interest rates

   Credit Score                            APR
   760–850                                 5.1%
   700–759                                 5.3%
   680–699                                 5.6%
   660–679                                 5.8%
   640–659                                 6.0%
   620–639                                 6.7%
   600–619                                 7.0%
   Below 600                         subprime market only
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   Want a free copy of your credit report?

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Saving For The Future

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Stuff You Might Find Useful
                                                     Debt Payments-to-Disposable
Debt Service-to-Income Ratio                         Income Ratio
(includes rent/mortgage)                             (excludes rent/mortgage)
      Annual debt pmts                            Monthly non mortgage debt pmts
       gross income                                 monthly disposable income

     A ratio of 0.36 or less is                          A ratio of .15 or less is desirable.

                                                 Note: disposable income is the amount of income
                                                 remaining after taxes and withholdings.

    Rome wasn’t built in a day!               If Jeff (a 30 year old) making 46K
                                              yr. invested 15% of his income for
   Understand Dollar Cost Averaging.          retirement at 10% he would have
                                              3.6 million when he’s 70.
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Words Of Wisdom

1. Don’t let your emotions get in the way.

2. Resist the urge to splurge

3. Be realistic

                                                    If your married, don’t
                                                       fight, be partners!
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Words Of Wisdom

 Be grateful for what you have.
 Being frugal is the cornerstone of building
 The best things in life really are free.

                       Mind Over Money
 Dave Ramsey –
 Mind Your Finances –
 Retirement video -
   Social Security estimate -
   Drive Free, Retire Rich -
   Introduction to Mutual Funds -
   The Millionaire Next Door – By Thomas Stanley -

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