Lesson 1-2
Give one example of a "need" and one example of a "want"
Need: food, clothing, paying bills, water, rent
Want: video game, takeout food, fancy clothes, iphone
A spending plan to help manage your money
What is a budget?
A loan from the bank
What is credit?
Risk-return ratio of stocks
What is high risk and high return?
What is a check?
What is the name of a bank account you keep your money in and do not spend from?
A savings account
Restriction on the amount of money a person can spend
Spending limit
Usually comes with low risk
What is low return?
The risk-return ratio on government bonds
low risk, low return
Sarah and Max both receive their weekly allowance of $10 from their parents. They want to buy a new book that costs $8.
Question: Sarah wants to use her debit card, while Max prefers to use his credit card. Which option do you think is better: using a debit card or a credit card? Explain your answer.
What is a debit card because you do not have to borrow money?
Kate wants to go out with her friends but she is trying to save money for a new car
What is opportunity cost?
The possibility that something bad might happen
What is a risk?
A plastic card that takes money out of your checking account
What is a debit card?
A certificate sold by the U.S. government or a company
What is a bond?
Sarah loves to draw and wants to participate in an art class after school. The art class meets every Monday for a month and costs $5 per session. Sarah also enjoys playing basketball with her friends during that time. If Sarah chooses to attend the art class, what is the opportunity cost?
What is $20 and missed time playing basketball with her friends?
Give me an example of a short term saving goal.
Answers may vary. Moderator use discretion
Putting money into a savings account
What is a deposit?
A paper form of debit
What is a check?
A share of the company
What is a stock?
Jay wants to raise money as quickly as possible so that he can buy a new pair of Nike sneakers. His grandmother gave him 75 dollars for his birthday, but he will need more to buy the shoes. He is thinking of investing. Which payment option is the best decision for him? What is the risk-return option for the answer chose?
a. Certificate of Deposit
b. Stocks
Type of savings goal necessary to save up for a car
What is a long-term savings goal?
Taking money out of a savings account
What is a withdrawl?
Process for how a credit card works
What is when you swipe a credit card the following happens:
1. The credit card company pays the store
2. Then the credit card company charges you.
3. You pay them back the money with interest
Documentation you get when you lend money to the bank for a set amount of time. At the end, the bank pays you back the money with interest.
What is a certificate of deposit?
Name five types of information that should be kept personal.
·Birth date
·Phone number
·Home address
·Bank account number
·A parent’s credit card number
·Passwords
·School name and address