centre: date: viii conference “financial education for ... · 8 italy 1.814.762,86 9 brazil...

Speaker:

Centre:

Date:

VIII CONFERENCE “FINANCIAL EDUCATION FOR YOUNG PEOPLE”

INDEX

1. FINANCIAL EDUCATION

2. EDUFINET PROJECT

3. FAMILY BUDGET

4. ECONOMIC AND FINANCIAL INDICATORS

5. FINANCIAL SYSTEM AND THE MAIN

FINANCIAL PRODUCTS

Aim of the conference:

To approach the economic-financial world for

young people

Financial

Education

Daily

Reality

VIII CONFERENCE “FINANCIAL

EDUCATION FOR YOUNG PEOPLE”

THE INCREASING PROMINENCE OF

ECONOMIC AND FINANCIAL CONCEPTS

VII FINANCIAL OLYMPICS P

AR

TIC

IPA

NT

S

CLA

SS

ES

Vountary registation Tems of 2-5 members, registration deadline

17/03/17

Financial-economic case

Registration deadline: 02/04/17

5 best tems selection Technical committee

5/5/17

Financial-economic case argumentation

public defense

Unicaja Center of Financial Education:

26/5/2017

Malaga Ferris wheel visit

Pompidou museum

visit Draw of 1

USA grant

Jury

Winners:

First prize, second prize, third prize

PRIZES

First Prize

Present

Second Prize

Present

Third Prize

Present

Classroom

TV LG 24 ‘’

Teacher

iPad Air 2 16Gb

Portátil HP 15,6’’

iPad mini-2 16Gb

Students

iPhone SE 16Gb

iPad Air 2 16Gb

iPad mini-2 16Gb

FINANCIAL EDUCATION AND SPORT

Possibility to

assist to a match

of Unicaja Basket

PUBLICATIONS DISTRIBUTED IN THE

VIII CONFERENCE “FINANCIAL

EDUCATION FOR YOUNG PEOPLE”

Financial guide 5º edition

Cómic “Financial Education in the town”

1 copy for each institute

15.000 pendrives 1 for each participant

Accesible content from www.edufinet.com

INDEX

1. FINANCIAL EDUCATION

2.

3.

4.

5.

WHAT IS FINANCIAL EDUCATION?

• Improvement of the knowledge of financial products, concepts and risks.

1. KNOWLEDGE AND

UNDERSTANDING OF FINANCES

• Develpment of skills that allow people to serve better their own interests in relation with financial services

2. COMPETENCES: USE OF

KNOWLEDGE FOR ONE’S OWN

BENEFIT

• Decision making aimed to improve one’s own financial welfare, gaunging advantages and disadvantages

3. INFORMED CHOICES: FINANCIAL

RESPONSABILITY

THE IMPORTANCE OF FINANCIAL

EDUCATION

Pilot project of Financial

Education in 3rd year of ESO

2012 PISA report results,

published on the 9th of july 2014 Financial Education for Youth

The role of schools


EDUCATION

Rank Country Average Score

1º China (Shanghai) 603

2º Belgium (Flanders) 541

3º Estonia 529

4º Australia 526

5º New Zeland 520

6º Czech Republic 513

7º Poland 510

8º Latvia 501

OCDE countries average: 500

9º United States 492

10º Russia 486

11º France 486

12º Slovenia 485

13º Spain 484

14º Croatia 480

15º Israel 476

16º Slovak republic 470

17º Italy 466

18º Colombia 379

No. of students tested ≈ 29.000

Participant countries: 18

OECD’s PISA

report

1 out of 6 students

doesn’t reach the

basic

development level

in financial issues

RESULTADOS


EDUCATION

• 1) Large amount of financial products.

• 2) Complexity of financial products.

• 3) Consumers have a lack of information.

Difficulty in making

financial decisions


EDUCATION


financial decisions

• 1) Large amount of financial products.


EDUCATION

42,20% 39,00%

16,80%

2,00%

0,00%

5,00%

10,00%

15,00%

20,00%

25,00%

30,00%

35,00%

40,00%

45,00%

Efectivo y depósitos Renta variable yfondos de inversión

Prod. Previsión OtrosEstimate Products Cash and Deposit Equity and Investment funds Others

• 2) Complexity of financial products.

Structure of Financial Assets of Families in Spain

57,8%


EDUCATION

• 3) Consumers have a

lack of information.


financial decisions


EDUCATION

Vital cycle

Benefits of

financial

education for

young people

Understanding the value of money

Planning of budget and savings and

investment needs

Training for an indepndent life

Knowledge of financial products

and services

Edad 18 65

Revenues

•Saving books • Cards

•Loans •Current Accounts •Deposits •Cards •Equity •Fixed income

•Reverse mortgage

•Pensions Plan •Insurance

INDEX

1.

2. EDUFINET PROJECT

3.

4.

5.

EDUFINET PROJECT

CSR exercise

Transfer of knowledge related To the financial system

The improvement of financial literacy

To contribute to

In the financial

relationships of the

citizens

PROMOTION OF: Transparency Security Responsability

GOALS

Elaboration of a Manual

• Internet • Book

• Simple

• Clear

• Objective

•Financial System

• Financial products and services

Introductory Vision

Formation for making personal decisions

To increase financial services user’s

personal autonomy

ww.edufinet.com

Games

CO

NT

EN

TS

Edufinet’s

profiles in

Facebook and

Twitter

Search

engine

Glosary

Enquires

News

Simulators

Subscriptions

and contant

Groups

Library

Introductory course

Financial Education

www.edufinet.com/edufinext

Contents

News

Games

<<Education financiera en

la ciudad>> comic free

download

IV and V Financial

Olimpics best videos

Cooperation agreement

between Unicaja and

Territorial Delegation of

Education in Malaga

VIII Financial Education

Conference

2016-2017

VII Financial Olympics

Resumen de las VI

Olimpiada Financiera

www.edufinet.com/edufinext

COMIC

OLYMPICS

CONFERENCES

INTERNET

GATEWAY

DOCUMENTS

AND

DIVULGATIVE

TEXTS

INDEX

1.

2.

3. FAMILY BUDGET

4.

5.

FAMILY BUDGET

31.12.2016 Equity value (€)

A B C D

Assets and rights 450.000 200.000 300.000 500.000

Debts 200.000 30.000 35.000 190.000

2016 revenues and expenses

A B C D

Revenues 15.000€ 20.000€ 10.000€ 45.000€

Expenses 8.000€ 10.000€ 5.000€ 20.000€

What person is the richest in 2016?

FAMILY BUDGET

Family budget allows

1. To know available resources

and in what the money is

spent

2. To control deposits and

expenses

3. To make previsions

•Salaries

•Pensions

•Return of investments

REVENUES (R) •Loans

•Taxes

•Family expenses

Education

Telecommunications Tranport

Energy Clothes and shoes Food

Free time

•Insurante

•Pension Plans

EXPENSES (E)

(R) - (G) = BUDGETARY BALANCE If (R)>(E) = Surplus If (R)=(E) = Balance

If (R)<(E) = Deficit

FAMILY BUDGET

• Systematic integration of revenues and expenses: general vision and complete

01/01 31/17

2017

Money entries

Money exits

FAMILY BUDGET

• Identification all the big accounting intems: categorize

• Schedule the entries and exits money

• Calculate the budgetary situation: balance, surplus or deficit

• Estimate of the possible gap transitory between payments and revenues

FAMILY BUDGET

• Never exist a budget Improve personal financials

• Exist a gap betwen incomes and expenses The budget allows the

possibility of improve it

• Incomes are unstable Financial plans to face the stage when the

incomes are low

• Important changes in life New problems Expenses

When is important to have a budget?

FAMILY BUDGET

How to develop a budget?

• Exhaustively identification of revenues and expenses entries

Revenues and expenses

• Periodic reviewing of revenues and expenses

• Impact of taxation

• Suplementary expenses

Accuately quantification of revenues and expenses

• Revenues ≠ Collections

• Expenses ≠ Payments

Establishment of the collections and payments dates

FAMILY BUDGET

Income

Expenses

31.12.2016 Wealth1

31.12.2017 Wealth2

Year 2017

variable «flujo» – money influes in a given period

variable “stock”

Equity at a specific date

THE INCREASING PROMINENCE OF

ECONOMIC AND FINANCIAL CONCEPTS

ASSET LIABILITY

• Car

• Financial

products

• Current

account

• Stocks

• Fixed

income

• Mutual

founds

• Pension

Plans

• Real estate

• Mortgage

• Consumer debt

MONEY INFLOW AND OUTFLOW EQUITY

INFLOW

OUTFLOW

• Salary

• Pension

• Return of Invesments

• Loans

• Taxes

• Withholdings

• Family Expenses

• Insurances

• Pension Plans

If inflow > outflow savings

(Income statement) (Balance sheet)

↑ Asset ↓ Liability

FAMILY BUDGET

31.12.2016 Equity value (€)

A B C D

Assets and rights 450.000 200.000 300.000 500.000

Debts 200.000 30.000 35.000 190.000

2016 revenues and expenses

A B C D

Revenues 15.000€ 20.000€ 10.000€ 45.000€

Expenses 8.000€ 10.000€ 5.000€ 20.000€

What person is the richest in 2016?

INDEX

1.

2.

3.

4. ECONOMIC AND FINANCIAL INDICATORS

5.

ECONOMIC AND FINANCIAL

INDICATORS

Economic indicators

Financial indicators

• Gross Domestic Product (GDP)

• Inflation

• Labour market

• Exchange rate

• Profitability

• Leverage

• Solvency

ECONOMIC INDICATORS

Gross Domestic Product

(GDP) Inflation

Labour market Exchange rate

ECONOMIC INDICATORS

a. Because the growth of the GDP reflects an

increment in the economic activity.

b. Because the growth of the GDP means a

decrease of the unemployment rate.

c. Because the growth of the GDP is associated

with a reduction of the prices.

d. a) and b) are correct.

Why growth of GDP is so important?

ECONOMIC INDICATORS

World GDP Ranking 2015

Ranking Country Million of dollars

1 United States 17.946.996,00

2 China 10.866.444,00

3 Japan 4.123.257,61

4 Germany 3.555.772,43

5 United Kingdom 2.848.755,45

6 France 2.421.682,38

7 India 2.073.542,98

8 Italy 1.814.762,86

9 Brazil 1.774.724,82

10 Canada 1.550.536,52

11 South of Korea 1.377.873,11

12 Australia 1.339.539,06

13 Rusia 1.326.015,10

14 Spain 1.199,057,34

15 Mexico 1.144.331,34

Definition

GPD: Value of the productive activity

In a given period of time

In a country or a geographic zone

Resident agents (nationals and foreigners)

Only final goods and services included

Fuente: Banco Mundial

Recession: GPD decreases at least two consecutive quarters.

Fuente: INE

(Spain)

ECONOMIC INDICATORS

a. Because the growth of the GDP reflects an

increment in the economic activity.

b. Because the growth of the GDP means a

decrease of the unemployment rate.

c. Because the growth of the GDP is associated

with a reduction of the prices.

d. a) and b) are correct.

Why growth of GDP is so important?

ECONOMIC INDICATORS

The Nuñez Family gets an anual income of 24.000 euros in

2015 and 26.000 euros in 2016. It is known that the price

level has risen by 5% in 2016 with respect to 2015. The

increase revenue of the Nuñez Family in real terms is:

a. 4,21%

b. 3,17%

c. -5,58%

d. -6,03%

ECONOMIC INDICATORS

INFLATION

Example of CPI calculation

•Persistent increase in the general price level of an economy. •There are several inflation indicators, the CPI being the most used.

2016 2017

Assets Annual

consumption

per family

Price

(€)

Price

(€)

Food 40% 3.000 1.20

0

3.050 1.220

Clothes and

shoes 15% 1.500 225 1.600 240

Transport 25% 2.000 500 2.050 513

Spare time 20% 2.000 400 2.050 410

100% Weighted

Average

Price

2.32

5

Weighted

Average

Price

2.383

2.325 = 100 2.383 = x

x = 2.383* 100

2.325

102,47 x =

2,47%

ECONOMIC INDICATORS





a. 4,21%

b. 3,17%

c. -5,58%

d. -6,03%

ECONOMIC INDICATORS





a. 4,21%

b. 3,17%

c. -5,58%

d. -6,03%

26.000

1,05 = 24.761,90

3,17%

ECONOMIC INDICATORS

Thousands of persons

Total population 46.438.900

Working-age population 38.496.600

Labour-force 23.015.500

Population not in the labour-force 15.481.100

Unemployed 5.149.000

Which one is correct?

a. Population not in the labour-force / Working-age population: 40,21%

b. Unemployed / Working-age population: 13,37% c. Unemployed / Labour-force: 22,37% d. Population not in the labour-force / Total population: 33,33%

ECONOMIC INDICATORS

LABOUR MARKET

Ranking Country Unemploye

d rate 2015

1 Spain 20,1%

2 Italy 11,7%

3 France 9,9%

4 Brazil 8,2%

4 Canada 6,8%

7 Australia 5,8%

8 Russia 5,4%

5 United States 4,9%

6 United Kingdom 4,9%

9 Germany 4,2%

12 China (2014) 4,0%

11 Mexico 3,9%

13 India (2014) 3,6%

15 South of Korea

(2014) 3,5%

14 Japan 3,2%

TOTAL POPULATION

WORKING-AGE POPULATION

NON WORKING-AGE POPULATION (<16

YEARS OLD)

LABOUR FORCE

POPULATION NOT IN THE

LABOUR FORCE

EMPLOYED POPULATION

UNEMPLOYED RATE

EMPLOYEES

SELF-EMPLOYED

SEEKING THEIR FIRST JOB

HAVE WORKED BEFORE

RETIRED

STUDENTS

OTHER GROUPS

Fuentes: Banco Mundial

ECONOMIC INDICATORS

Thousands of persons

Total population 46.438.900

Working-age population 38.496.600

Labour-force 23.015.500

Population not in the labour-force 15.481.100

Unemployed 5.149.000

Which one is correct?

a. Population not in the labour-force / Working-age population: 40,21%

b. Unemployed / Working-age population: 13,37% c. Unemployed / Labour-force: 22,37% d. Population not in the labour-force / Total population: 33,33%

ECONOMIC INDICATORS

a. It is preferable to buy pounds.

b. It is preferable to buy euros.

c. None of the answer is correct.

Recent surveys predict

euro-pound exchange will

increase because of Brexit.

This means:

ECONOMIC INDICATORS

iPhone 6S

United Kingdom

539£

Exchange rate: 1,18 €/£

Spain

650€

= 635€

The exchange rate is the price of a currency in terms of another currency,

Where is the

iPhone 6 most

expensive?

539£ x 1,18 €/£

Price of iPhone 6 in United Kindom =

ECONOMIC INDICATORS

a. It is preferable to buy pounds.

b. It is preferable to buy euros.

c. None of the answer is correct.

Recent surveys predict

euro-pound exchange will

increase because of Brexit.

This means:

FINANCIAL INDICATORS

PROFITABILITY LEVERAGE

SOLVENCY


Balance (2015) Income statement (2015)

Sales 92.175 149.467

Cost of goods (74.043) (117.624)

GROSS MARGIN 18.132 31.843

Operating costs (8.520) (20.795)

OPRATING RESULT (EBITDA) 9.612 11.048

Depreciation and amortisation (19) 1.691 EBIT (Earnings before interests

and taxes) 9.593 12.739

Financial results (369) 5

INCOME BEFORE TAXES 9.224 12.744

Tax on earnings (2.828) (4.033)

NET INCOME 6.396 8.711 *Figures in millions dollars

Current assets 61.831 91.847

Non current assets 110.793 125.319

TOTAL ASSETS 172.174 217.166

Current liabilities 65.591 77.081

Non current liabilities 64.053 86.524

Equity 42.530 53.561 TOTAL LIABILITIES

+ EQUITY 172.174 217.166

*Figures in millions dollars


Which one is the most

profitable?

a) BMW

b) Mercedes-Benz

Which one is more

indebted?

Which one is more

solvent?

a) BMW

b) Mercedes-Benz

a) BMW

b) Mercedes-Benz

Sales 92.175 149.467

Cost of goods (74.043) (117.624)

GROSS MARGIN 18.132 31.843

Operating costs (8.520) (20.795)

OPRATING RESULT (EBITDA) 9.612 11.048

Depreciation and amortisation (19) 1.691

EBIT (Earnings before interests

and taxes) 9.593 12.739

Financial results (369) 5

INCOME BEFORE TAXES 9.224 12.744

Tax on earnings (2.828) (4.033)

NET INCOME 6.396 8.711 *Figures in millions dollars

Current assets 61.831 91.847

Non current assets 110.793 125.319

TOTAL ASSETS 172.174 217.166

Current liabilities 65.591 77.081

Non current liabilities 64.053 86.524

Equity 42.530 53.561

TOTAL LIABILITIES +

EQUITY 172.174 217.166

*Figures in millions dollars


Which one is the most profitable?

ROA Net income / Total assets 3.71% 4,01%

ROE Net income / Equity 15,04% 16,26%

Which one is more indebted?

Leverage Liabilities / Total assets 75,30% 75,33%

Which one is more solvent?

Solvency Equity / Total assets 24,70% 24,66%

INDEX

1.

2.

3.

4.

5. FINANCIAL SYSTEM AND THE MAIN

FINANCIAL PRODUCTS

FINANCIAL SYSTEM ROLE

PROVIDERS OF

FINANCIAL

RESOURCES

BORROWERS OF

FINANCIAL

RESOURCES

BANKING

INSTITUTIONS OR

CREDIT

INSTITUTIONS

FINANCIAL INTERMEDIATION

COLLECTIVE INVESTMENT

MARKET

FINANCIAL DESINTERMEDIATION

DECISION MAKING

VARIABLES TO CONSIDER IN

FINANCIAL SAVINGS PRODUCTS

PROFITABILITY

RISK

LIQUIDITY

TERM

What is the yield

obtained by the

invested capital?

Can I use the

invested

money at any

time?

What are the risks?

• Solvency of the

institution receiving our

money

• Invested capital

• Interest to be received

For what

period?

DEPOSITS BASICS ASPECTS

a. Investment fund

b. Building society

c. Credit union

d. Bank

Which of the following institution is not authorised to

receive public money from deposits?


Service fees

Depositor Custodian

(Deposit

insititution)

Money

Funds custody Movement statements Interest Services Funds availability

+

-

-

+

Liq

uid

ity

Pro

fita

bili

ty

Fixed-

term

deposit

(IPF)

Deposit

at sight

Early cancellation comission

Savings

account

Current

account

Bank statement

Cheque book

Savings books

No cheque book

Maintenance fee

Management fee

Building society

Credit union

Banks

Custodian

(Deposit

insititution)

MAIN FEATURES OF DEPOSITS

Account holder

DEPOSIT TITULARITY

INDIVIDUAL

COTITULARITY

INDISTINCT

CASH POOL ACCOUNT

Anyone by

himself

Every account

holder or some

account

holders

Account

Holder

OP

ER

AT

E W

ITH

TH

E D

EP

OS

IT

Authorized Only determined operating (i.e. funds withdrawals…)

Is the same to be an account holder than to be an authorized?

Account

holder

All kind of capacities: operate, modify contract terms, contract revocation, etc.

Owner of the balance

Authorized Only some operations: (i.e. funds withdrawal)

They aren’t owners of the deposit


a. Investment fund

b. Building society

c. Credit union

d. Bank

Which of the following institution is not authorised to

receive public money from deposits?

LOANS

What is the main feature of the installment systme of

loans?

Only interests payment +

amortization payment in the

last installment

Constant fees

Constant interest

Constant amortization

Interest Amortization

a) b)

c) d)

LOANS

Loan amount

Term

Potential tax benefits

Total redemption of the capital Initial fees

Taxes and formalization expenses

Repayment intallments = Capital + Interests

Operation setting up

TIPS TO CONSIDER WHEN APPLYING

FOR A LOAN

What do we want finance with a loan?

What do I have to

consider?

Interest rate Fixed interest rate usually

Amount Usually < 60.000€ No > 80% of the property value

Commissions and fees (Taxes)

Opening, study, cancellation commissions

Opening and cancellation commission, notary, valuation, …

Term Short and medium term ( 10 years)

Long term (> 20 years)

APR Real cost of the operation

Usually, variable interest rate: • Index used • Differential • Review date

LOAN WITH

PERSONAL

GUARANTEE

MORTGAGE LOAN

Personal rate > mortgage

What do we want finance with a loan?

What do I have to

consider?

Interest rate Fixed interest rate usually

Amount Usually < 60.000€ No > 80% of the property value

Commissions and fees (Taxes)

Opening, study, cancellation commissions

Opening and cancellation commission, notary, valuation, …

Term Short and medium term ( 10 years)

Long term (> 20 years)

APR Real cost of the operation

Usually, variable interest rate: • Index used • Differential • Review date

LOAN WITH

PERSONAL

GUARANTEE

MORTGAGE LOAN

Personal rate > mortgage

LOANS


loans?

Only interests payment +

amortization payment in the

last installment

Constant fees

Constant interest



a) b)

c) d)

LOANS


loans?

Only interests payment + amortization

payment in the last installment

Constant fees

Constant interest



a) b)

c) d)

MEANS OF PAYMENT

The credit cards utilizes the direct debit to the

account:

a) False, the credit card utilizes a limited preloaded

amount as the prepayment card.

b) False, the credit card utilizes and aprroved credit

to be used.

c) True, the credit card utilizes a direct debit to the

account as the debit card.

d) False, the credit cartd utilizes for each online

purchase as the virtual card.

MEANS OF PAYMENT

Concept They are payment instruments replacing coins and notes: cards,

transfers, commercial documents (bill of exchange, cheque,

drafts).

Cards

Credit: approved credit

to be used

Prepayment: Use limited to the preloaded

amount

Virtual: Request for a virtual card for

each online purchase

Debit: direct debit to the

account

Usual means of

payment: cards

MEANS OF PAYMENT

Validity date

Security chip

•Visa •Mastercard

Issuers institution’s logo

National network

1234 5678 9012 3456

Name of the card holder

Month / Year International brand

•Euro 6000 •4B •Servired

PAN 16 dígitos (unique)

Signature panel CVV2

Contact details of the issuer institution

Magnetic band

Code for e-commerce operations (3 digits)

Contactless

Validity date

Security chip

•Visa •Mastercard

Issuers institution’s logo

National network

1234 5678 9012 3456

Name of the card holder

Month / Year International brand

•Euro 6000 •4B •Servired

PAN 16 dígitos (unique)

Signature panel CVV2

Contact details of the issuer institution

Magnetic band

Code for e-commerce operations (3 digits)

Contactless

MEANS OF PAYMENT

The credit cards utilizes the direct debit to the

account:

a) False, the credit card utilizes a limited preloaded

amount as the prepayment card.

b) False, the credit card utilizes and aprroved credit

to be used.

c) True, the credit card utilizes a direct debit to the

account as the debit card.

d) False, the credit cartd utilizes for each online

purchase as the virtual card.

MEANS OF PAYMENT

Is it chepa the use of the credit card (because of the credit to be used)?

Cost of the credit card with 1,2% monthly rate:

APR = 1 + 1,2

100

12

– 1 = (1 + 0,012)12 – 1 = 1,01212 – 1 = 1,154 – 1 = 0,154 15,4%

Speaker:

Centre:

Date:

VIII CONFERENCE “FINANCIAL EDUCATION FOR YOUNG PEOPLE”

centre: date: viii conference “financial education for ... · 8 italy 1.814.762,86 9 brazil...

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