Financial Survival 1 Maryland Content Standards on Personal Finance Short term.

Financial Survival 1

Maryland Content Standards on Personal Finance

Short term

Standard Three

• Goals, Spending Plans, and Markets

Short Term Goal Setting

• Short term goals are usually those you wish to accomplish in less than a year.

• Intermediate Goals usually are for one to five years, and

• Long term goals are usually for five or more years.

Setting Short Term Goals

• Financing your Future Activity 1.2.1

Some Short Term Financial Goals

• Pull your credit report at www.annualcreditreport.com

• Write a will

• Adjust your investment portfolio

• Adjust your tax withholding

• Pay down short term debt like credit card balances

Charity and Philanthropy

• Unfortunately, not all charities are legitimate or efficient.

• A good web site to check out charities is www.charitynavigator.org

Short Term Budgeting

• Activity 20.2A and 20.2B from FFFL

• John and Marcia’s Monthly Spending Plan

Short Term Tax Decisions

• Use a tax pro or do it yourself

• Health Savings accounts

• Child Care Savings Accounts

• Adjusting your tax withholding

Spending often requires signing contracts

Short Term Contracts

• Cell phone

• Apartment

• Car Rental

• Merchant Credit Card

• Student loans

Contract Obligations

Most people do not read the contracts they sign.

Young adults (18-24), especially, do not read what they are signing because they only recently became responsible for what they sign.

Cell Phone Contract

• From www.radicalparenting.com

• Cell phone contract for a teenager

Students Need to Know

• Co-signing means responsibility for 100% of the loan balance if the person for whom you have co-signed stops making payments.

Auto Buying Myth

• There is no “three day cooling off period” when you buy a car.

Markets Affect Spending

• Refer to “An Introduction to Market Structure” Handout

What do Consumers need to Know About Market Structures

• Perfectly Competitive:– Chance to negotiate the price?– Expectation of quality differences?– Need to comparison shop?– Expectation of Government regulation?

What do Consumers need to Know About Market Structures

• Monopolistically Competitive:– Chance to negotiate the price?– Expectation of quality differences?– Need to comparison shop?– Expectation of Government regulation?

What do Consumers need to Know About Market Structures

• Oligopoly:– Chance to negotiate the price?– Expectation of quality differences?– Need to comparison shop?– Expectation of Government regulation?

What do Consumers need to Know About Market Structures

• Monopoly:– Chance to negotiate the price?– Expectation of quality differences?– Need to comparison shop?– Expectation of Government regulation?

Supply and Demand Graphs

• Producers provide goods and services

• Consumers buy goods and services

Government Intervention

• Price Floor – When the gov’t says the price of something may not go below a certain set price.

• Price Ceiling – When the gov’t says the price of something may not go above a certain set price.

Price Floors and Price Ceilings

• See Handout from Capstone, “Unit 2, Lesson 14, Secondary Effects: Price Floors and Price Ceilings”

Another Look at Gov’t Intervention

• Lesson 6 – High School Economics in Virtual Economics CD –

• “Price Controls – Too High or Too Low?”

What are the Consequences for Consumers?

• Price Floors – Tend to cause surpluses – Why?

• Price Ceilings – Tend to cause shortages – Why?

• Other unintended consequences?