Financial Workshops
Benjamin Franklin believed in living within your mean. Well, what is my mean?
MONEY CONCEPTS EXPLORED
Investment, know how, financial planning, basic money management
- Understanding Money
- Understanding yourself, your rights, and responsibilities
- Managing everyday money
- Planning ahead
- Selecting financial products suitable for you
INTEREST CONCEPTS TO KNOW
Typical Compound Interest case studies below:
| Jeremiah wants to put away $20,000 into a 401K that pays 8% interest monthly for 40 years. How much do you think Jeremiah will have in his account at the 40-year mark? | Betty wants to have at least $2,000,000.00 by the time she retires in 45 years. She opened an account that pays 9.5% quarterly. Betty wants to know how much she needs to invest today to reach the goal. |
| Compound Interest Formula: A=P(1+r/n) n*t A=amount we want to find. P=principle, the initial investment ($20,000) r=interest rate (8% or .08) n=number of annual payments (12) t=time or term (40 years) | Compound Interest Formula: A=P(1+r/n) n*t A=$2,000,000.00. P=principle unknown?? r=interest rate (9.5% or .095) n=number of quarterly payments (4) t=time or term (45 years) |
| Results: A = $485,467.79 is in Jeremiah’s account after 40 years of savings. | Results: P = $29,249.96 is starting principle needed for Betty to reach her goal of $2,000,000.00 of retirement funds after 45 years. |
Compound interest concepts means that your money will accumulate in a continuous compound fashion over a period of time.
How my FICO score is created:
Fact: FICO credit scores are used by creditors to determine your credit worthiness. Basically, are you able to pay back the money your borrowed on credit.
Five factors of credit score:
- Payment history length
- Amount currently owed on credit
- History of payment time
- Any new credit opened
- Type of outstanding credit
- Specific: Is the goal easy to understand; Does it answer: What – Why – Who – When – How
- Measurable: Can I set milestones; How do I measure progress
- Achievable: Is this something reachable; Do I have the tools, dedication to follow a plan.
- Realistic: Is it within the realm of reality it can happen.
- Time-bound: Can I put a time range to achieve this financial goal.