There

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Theres a lot to learn about money!

Why is Money Important?
Presented by the San Francisco Federal Reserve
Bank in Collaboration with Operation Hope
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Theres a lot to learn about money!

• Key Concepts
• Budgeting
• Rate of Return
• Risk

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What Is A Budget?
A plan for spending money

• Expense
• Income

Budget Game
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Budget Game Debrief

• What do you notice about the data?
• Why do you suppose there is a difference?
• Why do people create budgets?

A Budget Gives You Control
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Are you going to manage your money? Or

Is money going to manage you?
What would you do with the money left over at the
end of each month?
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Where can I save or invest my money?

• Types of Accounts Saving and Investing
• Savings Accounts
• Certificates of Deposits (CD)
• Stocks and Bonds
• Real Estate

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Key Factor 1 Saving Investing

• Rate of return
• The amount of money you earn on your
  investment
• Amount
• Rate of Interest
• Time

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Rate of Return

• What is your return if you invested 500 at 3
  for 1 year?

15
5
24
3
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How long would it take to double your money?
The Rule of 72 72 divided by the interest rate
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Key Factor 2 What is the Risk?
How much would I have to pay you to..

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Rate of Return

• What is your return if you invested 500 at 3
  for 1 year?

15
5
24
3
8
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Two Rules to Live By

• Spend Less Than You Make
• Pay Yourself First

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What Happens When You Violate Rule 1?
You Spend More Than You Make

• Borrow Money
• Credit Card
• Balance of 5,000 at 17 Interest
• Minimum Payment
• 81 years to pay off the balance

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What Happens When You Honor Rule 1?
You Spend Less Than You Make

• Honor Rule 2 Pay Yourself First

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Pay Yourself First
How Much Money Could You Earn If

Saved 15/day until you were 65?
1,000,000
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Why is Managing Your Money Important?

• Spend Less Than You Earn
• Pay Yourself First

• Budgeting
• Rate of Return
• Risk

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Got Questions?
www.frbsf.org

www.operationhope.org
www.FederalReserveEducation.org