As you study the material, each student is urged to develop his/her personal economic empowerment goals and plans as well as be open to developing an accountability partnership with a fellow student. There will be a quiz at the end to insure students have grasped some of the basic concepts being discussed.
Summary Highlights -
1. Most people need health, disability, life, home or renter’s, and auto insurances. With life insurance, buy term and invest the difference between the term and what you would have paid with whole life or universal life. Avoid credit life or mortgage insurances.2. KISS - keep it simply, stupid. Use mutual funds to invest in stocks and bonds. There are annuities, municipal bonds, and commodities that may or may not be for you - check with a financial advisor
3. Look for funds with stable management (i.e., it may be a team), good performance, and low expenses compared to their peers. Look at the family of funds and volatility as well. Look for 10-15 year records, no less than 5 years. Start with a growth and income mutual fund. Add growth, international, and aggressive growth, as your portfolio and risk tolerance allows.
4. Invest long term with pre-tax dollars - IRA, 401 K, 403 B. There are educational saving accounts, educational IRA, and 529 saving plans for college.
5. Learn to negotiate, where to find bargains, and have patience. Look for scratch and dents. The lucky seven basic principles of negotiating - 1. Always tell the truth. 2. Use the power of cash. 3. Understand and use “walk away” power. 4. Shut up. 5. “That is not good enough. What can you really do?” 6. Good guy - bad guy. 7. “If I …” - Give and take. Individuals are a good source of great buys. Repossessed and public auction cars, coupons, and foreclosed real estate can be helpful.
6. Singles need to guard against impulse spending and not having a plan. They would do well to have a money mentor. Widow(-er)s should not make big decisions after the death of their spouse, until they have re-established their balance.
Christian Personal Financial Management Discussion Questions (use extra paper as needed):
1. Do you think having insurances are important? Why? What are your thoughts on buying term and investing the difference between what you would have paid for whole life and what you pay for term (i.e., agree, disagree, don’t know, etc.)? Why?
2. What are your thoughts regarding investing in mutual funds and tax advantaged instruments like IRAs? Why? List a couple of items to look for in a financial advisor.
3. What are your thoughts regarding negotiating? Why?
4. What are your thoughts regarding Ramsey’s advice to singles? Why?
5. What else would you like to share (e.g., goals, accountability partnership, etc.)?
Conclusion: Let’s work on being better stewards of our finances and helping others do the same. God has much for those who obey His will, regarding Christian personal financial management.
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