FFIB Program Finance-Fraud-Insurance-Banking and you

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FFIB ProgramFinance-Fraud-Insurance-Bankingand
you
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Why Are We Here?
Teens Between 13 18 Spent 155,000,000,000 in
2000. Source Stages magazine, Fiscal
Fitness for Teens, Summer 2001 Issue.
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Your experience is limited. You are a Prime
Target for
SCHEMES SCAMS
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PERSONAL DEBT
The average college undergraduate student has
2748 in credit card debt. At 18 interest, and
paying 50 per month, it will take 9.5 years to
pay this debt off.
Source Stages magazine,Fiscal Fitness For
Teens. Summer 2001 issue.
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Your First Car Have you thought about.

• Needs vs. wants
• New -- Rebates and other incentives new car
  warranty
• Used -- as is -Lemon Law (does not apply to
  used autos)
• Financing or cash
• Reputable, licensed dealership
• Accurate/fair pricing check book values
• Insurance costs, maintenance/gasoline costs
• Can you pay for it ? Live with it ?

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Buying a CarHow will you pay?

• Lot Financing on the spot
• Bank
• Credit Union
• Credit Card
• Cash?

• leasing a car is an option

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Negotiate!!!

• Prices
• Interest rates
• Trade in allowances
• Down Payment

Signed Contracts are Final!!!
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Consider the Real Car Costs

• Do you have a trade-in?
• Is there a lien or outstanding loan on the car?
• What payment can you live with?
• What is the interest rate?
• How many payments?
• Out of Pocket Repair Expenses?
• What is the cost of the insurance premiums?
• Dont forget Other costs such as tag, title, or
  registration

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True Cost of 95 Mustang

• Itemization of Amount
  Financed
• Cash Price 5,900.00
• Down Pmt -900.00
• Unpaid Bal 5,000.00
• Tax
• Doc Stamps 18.00
• Tag/Title 35.00
• Optional
• Credit Life Ins 107.00
• Add-Ons. 1,000.00
• Amt Financed 6,160.00

• Amt Financed 6,160.00
• Finance Charge 3,141.60
• Total of Payments
  9,301.60

• plus monthly insurance premium

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RATE / MONTHLY PAYMENT COMPARISONS
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best deal

• Do not buy on impulse
• Take used cars to YOUR mechanic for a look before
  buying
• Dont believe verbal promises of sales staff
• We owe you Get it in writing!!
• Do not sign any papers with blank spaces, not
  fully completed
• Understand the payment schedule
• of payments is there a balloon note at end?
• Ask about any fees you dont understand
• Ask for the opinion of someone you trust
• Be ready to walk away the same deal will
  still be there tomorrow!

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Automobile Insurance
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Under state law, if you own a motor vehicle, you
must carry Property Damage Liability ( PDL )
and Personal Injury Protection ( PIP )
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Comp. Collision

• Comprehensive Coverage pays for replacement
  or repair when damage is caused by fire,
  theft, windstorm, vandalism, flood, or
  other non-collision damage.

• Collision Coverage pays to repair or
  replace your automobile when you collide with
  another vehicle or object, or your vehicle
  is overturned.

Banks and other lending institutions will require
comprehensive and collision when a car is
financed.
Force Placed Insurance
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The Deductible is what will come out of your own
pocket, after a crash.
Comprehensive Collision
Deductible 2,000 Damage
1,800 Coverage 0
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Full Coverage ?
NO SUCH THING !
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The Deductible is what will come out of your own
pocket, after a crash.
PIP
Medical Expenses 10,000 Deductible
2,000 You pay the deductible, plus 20 of
medical expenses (2,000) Total You Pay
4,000
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• Automobile Insurance

Driving history Type of vehicle you drive
Where you live Your gender Your age Drivers
Education Your grades How you use your
vehicle (workpizza delivery)

• RATE FACTORS

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• Automobile Insurance

The PREMIUM is the money you pay to the insurance
company.

• Pay in full coverage for 6 months
• Monthly payments
• Premium Finance Company

• TERMS

• A high interest rate may make the premium
  unaffordable.

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Insurance Quotes for 95 Mustang
www.YourInsuranceCo.com
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• Remember the 1995 Mustang that cost 5900?
• What will it really cost?
• 9301.60 is the total amount financed
• Monthly Car Payment 258.38
• Monthly Insurance Payment 312
• Total Monthly Cost of Your Car 570.38
• Total cost 20,533.68 over 36 months

Dont forget gas and maintenance!
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And then, there was Credit

• The reputation for solvency and integrity
  entitling a person to be trusted in buying or
  borrowing.
• An arrangement for deferred payment of a loan or
  purchase.

Loan A sum of money lent at interest.
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Credit Sources
Banks and Credit Unions are the Best. The
interest rates are lower.
Finance companies are less desirable.
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Establishing Your Credit
Open your own checking or savings account
before you turn 18.

• Once you turn 18
• Your first credit card
• Rental agreements
• Utilities in your name
• Cellular phone

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Interest Rates and Penalties

• Credit Limits
• APR Annual Percentage Rate
• Annual Membership Fees
• Over the Limit Fees
• Monthly Fees
• Late Payment Fees
• Any Incentives
• Secured Credit Cards
• Pre-paid or Guaranteed Credit Cards

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Credit Card Sense

• Pay off the balance as soon as possible. Make
  payments on time.
• Dont have more than one credit card.

• Check/verify all charges when you get your
  monthly statement.
• Immediately notify the company in writing of
  any inaccurate information.
• Save card use for special occasions or
  emergencies
• Never let friends borrow your credit card
• Shred unused credit card offers
• If your card is lost or stolen .

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Understand what you sign/Know Your Rights

• Dont hurry into a deal that you dont understand
• Research before you buy and ask questions
• Take an experienced friend with you

• ALWAYS read what you are signing
• Dont sign blank contracts
• Walk away from sales pressure
• GET COPIES of anything you sign, especially
  contracts and policies
• Keep receipts
• Get it in writing verbal agreements are not
  legally binding

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Dangerous Waters
Auto Insurance
CARS
Credit Cards
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• AUTOMOBILE

• FRAUD

Have I got a Package Deal for you!
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• AGENT AGENCY

• FRAUD

Pocketing
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• AGENT AGENCY

Joe Someone

• FRAUD

The Wrong Way
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• AGENT AGENCY

Insurance Company Name

• FRAUD

The Correct Way
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FRAUD

• FRAUD

Lying can land you in JAIL!!
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Is This Your Future?