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Financial Literacy

a guide on financial litreacy

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aarissooch31
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344 views21 pages

Financial Literacy

a guide on financial litreacy

Uploaded by

aarissooch31
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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FINANCIAL

LITERACY
By – Aaris Sooch 8B
TABLE OF CONTENTS
INTRODUCTION ABOUT US
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OUR PROCESS STRATEGIES


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INTRODUCTION
In this presentation, I will cover important financial concepts that
help you manage your money. I’ll start with credit, which lets you
borrow money and pay it back later, and explain why good credit is
important. Then, I’ll explain debit, which uses your own money from
your bank account. I’ll also talk about loans, like personal, student,
and auto loans, and how they work. Next, I’ll discuss mortgages,
which are loans for buying a home, and how interest rates and down
payments affect them. Lastly, I’ll introduce investments, which are
ways to grow your money over time through things like stocks and
bonds. Understanding these basics will help you make smart
financial decisions.
1
CREDIT & DEBIT
CREDIT
• Credit is borrowing money to buy something now
and paying it back later, often with interest.
• Using a credit card is a common example, where
the company pays for your purchase, and you
repay them over time.
• Having good credit means you repay on time,
which helps you borrow money in the future.
DEBIT
• Debit is when you use your own money
from your bank account to pay for
things.
• For example, when you use a debit
card, the money comes directly out of
your account, and you’re only able to
spend as much as you have in there.
2
LOAN & MORTGAGE
LOAN
• A loan is when you borrow money and
agree to pay it back over time, usually with
interest.
• Loans can be for different things, like
education (student loans), buying a car
(auto loans), or personal needs (personal
loans).
• You make regular payments until the loan is
fully paid off.
MORTGAGE
• A mortgage is a special type of loan used to buy
a house.
• You borrow money from a bank or lender to pay
for the home, and then pay it back over many
years, usually with interest.
• To get a mortgage, you often need to make
a down payment(a portion of the home’s price)
upfront.
• If you don’t make your payments, the lender can
take the house back.
3
INVESTMENT
INVESTMENT
• Investment is when you put your money into
something, like stocks, bonds, or real
estate, with the goal of making more money
over time.
• You take on some risk, because the value
of your investment can go up or down.
• The idea is that, over time, your investment
will grow and help you reach financial goals,
like saving for retirement or buying a home.
4
REAL - LIFE APPLICATIONS
Tracking Income and Spending
1.Set Up the Budget Template
•Create or download a simple budget template in Excel, Google Sheets, or use
apps like Mint or YNAB.
•Divide the template into two main sections: Income and Expenses.
2.Input Income Sources
•List all income sources (e.g., salary, freelance work, rental income).
•Use columns for Projected Income (expected amount) and Actual
Income (received amount).
3.Track Expenses
•Categorize expenses into groups such
as Housing, Transportation, Food, Entertainment, and Savings.
•Add columns for Budgeted Amount, Actual Spending, and Difference to analyze
overspending or underspending.
4.Calculate Totals and Analyze
•Use formulas to calculate total income, total expenses, and savings (Income -
Expenses).
•Review the Difference column to identify areas to cut costs or reallocate funds.
EXAMPLES
Expense Category Budgeted Amount Actual Spending Difference Income Source Projected Income Actual Income

Salary $3,000 $3,000


Housing $1,200 $1,200 $0

Freelance Work $500 $600


Food $400 $450 -$50

Stocks $200 $250


FINANCIAL PLANNING TOOL
1. The 50/30/20 Method
• 50% Of the the income goes to Basic amenities.

• 30% to the The money goes to Wants

• And 20% of the money goes to investments or

savings.
2. Apps
• YNAB (You Need A Budget)

• EveryDollar
YNAB
EVERYDOLLAR
BIBLIOGRAPHY

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