Money Matters – Part 1 - PowerPoint Presentation

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Money Matters – Part 1

Developed for Crossroads Ministry of Estes Park

by

Andrea R. McCready, MBA; Marsha Yelick, CFABased on materials provided by

Spanish Version Translated by Eva BanuelosSlide2

Welcome

Introductions

Why arewe here?Slide3

Money Matters Seminars

WEEK 1 – Goals and Banking and Other Financial “Stuff”WEEK 2 - Dealing with Debt and Planning for the Future.

FUTURE - One-on-one financial counseling with a Crossroads case manager or Library Financial Counselor. Slide4

Set yourself up for success!

Policies and Procedures

Completing the SeminarsSlide5

Pre-TestSlide6

Session 1Objectives

Creating financial goals

Banking: (checking and savings)Money management without a bank.

TaxesSlide7

What are your Dreams?Slide8

Set Smart GoalsSlide9

Changing Dreams into Goals

Make the goal

SPECIFICBuy a laptop (what kind, what features, what cost? (Let’s say cost is $500.)Set a DEADLINE for the goal.

8 monthsMake a PLAN for achieving the goal.Perform extra jobs to set aside $15 per

week ($60 per month = $480)Slide10

Goal Setting Basics

Be SPECIFICSet a DEADLINEMake it REALISTICSlide11

Why Specific Goal Setting is Necessary

Few things are achieved without a plan.Goals give you a clear DIRECTION.

What you want.When you want it.What actions you will take to reach the goal.Goals keep you FOCUSED.

I want “this” more than “that,” even if “this” is down the road.8Slide12

Practice Setting GoalsSlide13

Protect Your Goals by

protecting Your Paycheck

BANKS - The safest place for your money Protect from theft

Protect from disastersProtect from visitorsProvide for record keepingMake transactions “mindful”If you choose to or are forced to work with cash, you must take steps to protect it.)

10Slide14

Choosing the Right Bank

Location

ServiceFees

RecommendationsFDIC insurance11Slide15

Main Types of Bank Accounts

Checking account

Savings accountCertificates of Deposit

IRACredit CardDebit Card

12Slide16

You still need to do work!

Deposit incomePay billsRecord transactions

Balance and ReconcileChoose various methods for all aboveSelect and manage credit/debit cards(For assistance, apps, the internet, and walk-in help,)

13Slide17

Make a Deposit

Over the counter at a

branchSlide18

Make a Deposit

Direct depositAutomated Teller Machine (ATM)

Self-service paying-in boxMail inAppsSlide19

Endorse your check

Endorsement

Back of checkUnder "ENDORSE CHECK HERE”As made out on front

 Do not write BELOW lineDo not endorse until you arrive at the bank.“For Deposit Only – Acct. XXXX” above your

signature IF SENDING THROUGH MAIL.Slide20

Types of Endorsements

Blank Endorsement Signature of the

Payee.  Once signed, may be cashed by ANYONERestrictive Endorsement Statement that check may only be deposited.Signature of the Payee 

Good for mailing deposits to the bank Special Endorsement (Very rare!)Used to sign check over to third partyStates “Pay to the order of”, name of party, Signature of payee Slide21

Accessing Your MoneySlide22

PIN selection

Immediate withdrawal

Used at ATMUsed at retail storesKeeping track

Fees or surcharges Overdraft protection???Debit cardsSlide23

Write a Check

Write in INK Write clearly and neatly. Fill in

ALL blank lines Long version amount usually rules. MEMO line for identifier. Slide24

Write a CheckSlide25

Set up an automatic paymentSlide26

Why use a check register?

Real time balanceBudget aid

Record of paymentBe intentionalAvoid fees

(Registry is free!)Check RegisterSlide27

Transaction type

DatePayee and “budget category”

Subtracted amountsFees

Added amounts“Running balance”Check RegisterSlide28

Checkbook Exercise

Your beginning balance for the month is $514.25

On 7/1 you get paid $1,239.36On 7/1 you pay your rent to Joe Landlord, check #101 for $700.00 On 7/4 You use the ATM at Elk Something Place to get $50.00. You can’t get to your own ATM, so You incur a $4.00 charge at the ATM.On 7/5 You write a check #102 to Town of Estes Park to pay your electricity bill. The amount is $92.65On 7/7 you use your debit card at Safeway to buy groceries for $57.36

On 7/15 Fred’s Bank auto-withdraws your car payment of $213.85Slide29

Different ways to keep a Check Register

Single Line Register

Double Line Register showing the math in the balance column.

A well-kept register should:

Tell you at a glance how much money is in the account.

Easily identify the purpose, type and amount of each transaction.Slide30

Bank Reconciliation

Why reconcile your bank account?Check the math (the bank and you)

Look for missing transactions (fees, etc.)Watch for fraudulent transactions

Know your account balanceSlide31

Bank ReconciliationSlide32

Bank Statement

The Ending Balance is the starting point for reconciling your bank statement against your check register.Slide33

Balancing a Checkbook

503.71

25.00

528.71

Debit

468.86

59.85

59.85

59.85

Balanced!Slide34

Savings Accounts

Money set aside for

the future.

Money set aside for

emergencies.Avoid borrowing when there’s an emergency.

Save for the big purchases to avoid borrowing

At least $1,000Slide35

How Savings Accounts Work

Accessible at any time.

No chance of loss.

FDIC insured.

Some (teeny, tiny) interest.

Some fees may apply.Slide36

Tips for Savings Accounts

Look for low fees.Combine savings and checking account balances to qualify for

no fees.Slide37

If banks are not an Option…

Reasons you might not want to use a bankRequired identification

Mismanagement historyTrust / bad experience Possible liens, garnishment, debts, etc.Slide38

Managing Cash

Conceal cashDo not carry large sums. Never mail

cash.Keep excess cash in a secure place. Fireproof strong box, locked drawer or locked filing cabinet. Avoid unlocked hiding places (freezer, book, rafters). Remember

where it is. Be sure a trusted person also knows.Slide39

Money orders to pay bills

Readily available.

Cost is face amount plus fee. Fees at Post Office:$

1.25 for $0.01-$500 $1.65 for $500.01-$1,000Similar to checkReceipt availableSlide40

Cashing Your Pay Check

Avoid check-cashing stores. (up to 5% percent of the check)Choose a safe time of day and environment

for check cashing.Use employer’s bank if there is a local branch.Comparison shop to find the best place to cash your check.Some banks offer prepaid card accounts (with monthly fee).Slide41

Sending Money Abroad

Cash to cash

: Walk in centers (Western Union, MoneyGram). Online using website or app, sometimes right from your phone (PayPal to PayPal).

Bank Accounts – bank to bank or using special remittance programs. Credit and Debit Cards – cash pickup or into accountPrepaid debit cardsSlide42

Figure the Cost

FEES, FEES, FEES:

By providersTo recipient. Currency exchange ratesSpeed of transfer

Cautions:Use correct informationInform recipient

Verify receipt of fundsSlide43

Taxes…

Unavoidable, but manageable!Slide44

Some tax myths

COMMON MISUNDERSTANDINGS

Filing is voluntary.Once you’ve past April 15, you’re in BIG trouble.Cash income isn’t reportable.Students and minors do not have to file tax returns.An extension to file means an extension to pay.Someone else must prepare your tax return.

Getting a big refund is the best result at tax time. Receiving a refund means the IRS agrees with my return. Slide45

Free tax preparation

IRS FreeFile. Estes Valley Library

has a program during tax time that provides tax preparation services through AARP:Program runs from February through mid April 15. Watch local newspapers for details.

Taxes are prepared by AARP trained volunteers and can usually be filed electronically free of charge. Bring prior year’s taxes, current year’s tax documents, social security cards, and photo IDCall Library for appointment: (970) 586-8116Slide46

Colorado Property Tax/Rent/Heat Rebate

"

PTC" rebate has been available every years in Colorado since 1971.  Qualified applicants could receive up to $792:Up to $600 for rent or property tax paid.

Up to $192 for heating expenses.Applicants have two years to submit the application. For example, the rebate for calendar year 2014 may be submitted on or before December 31, 2016.Slide47

SENIOR HOMESTEAD PROPERTY TAX EXEMPTION

The Senior Homestead Property Tax Exemption is currently available again.

Rebate is based on the applicant’s income and expenses and filing status. Submit Form 104 PTC to Colorado Dept. of Revenue   Qualified applicants could receive up to $792:

Up to $600 for rent or property tax paid.Up to $192 for heating expenses.Applicants have two years to submit the application. For example, the rebate for calendar year 2014 may be submitted on or before December 31, 2016.Slide48

Other tax credits

Possible Tax Credits for low to moderate income earners

Earned Income Tax CreditAmerican Opportunity Tax CreditLifetime Learning CreditChild and Dependent Care Credit

Savers CreditSlide49

Review

Realistic financial goals

Banking services

Safe cash managementTaxesSlide50

Any Additional Questions