![Page 1: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/1.jpg)
How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans
20022002
![Page 2: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/2.jpg)
22
Marsha A. Goetting Ph.D., CFP®, CFCSMarsha A. Goetting Ph.D., CFP®, CFCS
Professor & Extension Family Professor & Extension Family Economics SpecialistEconomics Specialist
Department of Agricultural Department of Agricultural Economics & EconomicsEconomics & Economics
![Page 3: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/3.jpg)
Have you wondered? Have you wondered? • What the monthly What the monthly payments would be on payments would be on a student loan after a student loan after graduation?graduation?
![Page 4: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/4.jpg)
Have you wondered? Have you wondered? • How much you would How much you would
save in interest charges if save in interest charges if you increased your you increased your payment?payment?
![Page 5: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/5.jpg)
WorkshopWorkshop• You are going to learn how You are going to learn how
to solve these & similar to solve these & similar problems quickly & easily problems quickly & easily by using a by using a financial financial calculatorcalculator
![Page 6: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/6.jpg)
Financial CalculatorFinancial Calculator
• Texas Instruments Texas Instruments BA-35 Solar Business BA-35 Solar Business AnalystAnalyst
• No longer availableNo longer available
![Page 7: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/7.jpg)
IntroductionIntroduction• Getting Acquainted Getting Acquainted
with your Financial with your Financial CalculatorCalculator
![Page 8: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/8.jpg)
Turn on Turn on
MODEMODE
CE/CCE/C
2nd2nd CPTCPT AC/ONAC/ON
NN
XX 12 12
% i% i PMTPMTPVPV FVFV
1212
FixFix
![Page 9: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/9.jpg)
Financial Mode Financial Mode
FinFin 0. 0.
• If If FINFIN is not lower left is not lower left cornercorner
• PressPress MODEMODE AC/ONAC/ONCPTCPT
![Page 10: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/10.jpg)
Decimal Function Decimal Function
FINFIN 0.00 0.00
• PressPress 2nd2nd
2nd2nd
FixFix
CPTCPT 22
![Page 11: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/11.jpg)
Clearing Screen/DisplayClearing Screen/Display
• Press key oncePress key once Clears Display Clears Display Corrects Incorrect Corrects Incorrect
EntriesEntries Clears word “Error”Clears word “Error”
CE/CCE/C
![Page 12: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/12.jpg)
Clearing Financial Registers Clearing Financial Registers • Press keyPress key Clears numbers in Clears numbers in
registers & displayregisters & display
NN %i%i PVPV PMTPMT FVFV
CE/C 2nd2nd
CMRCMR
CE/C
![Page 13: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/13.jpg)
Finance KeysFinance KeysNN
% i% i
PMTPMT
Number of PeriodsNumber of Periods
Interest RateInterest Rate
Payment AmountPayment Amount
![Page 14: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/14.jpg)
Finance KeysFinance KeysPVPV
FVFV
Present ValuePresent Value
Future ValueFuture Value
Compute keyCompute keyCPTCPT
![Page 15: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/15.jpg)
Student LoansStudent Loans
![Page 16: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/16.jpg)
Student LoansStudent Loans•CalculateCalculate
•PaymentsPayments
•Interest paidInterest paid
![Page 17: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/17.jpg)
Student Loans Student Loans • Bernie’s Loan Bernie’s Loan $23,000$23,000
• APR APR 8.258.25%%
• 2020 years pay years pay
![Page 18: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/18.jpg)
Student Loan $23,000 Student Loan $23,000 • Clear registers Clear registers 2nd CE/C CE/C2nd CE/C CE/C
• Loan amountLoan amount 23,000 PV23,000 PV
• Periods Periods 20 x 12 = 240 N20 x 12 = 240 N• % Rate% Rate 8.25 8.25 12 = 0.69 %i 12 = 0.69 %i
• CPT PMT 195.98 CPT PMT 195.98 (don’t clear)(don’t clear)
![Page 19: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/19.jpg)
Interest Paid Interest Paid
• $195.98 payment$195.98 payment
• x 240 # monthsx 240 # months
$47,034.02 paid $47,034.02 paid
- 23,000.00 loan- 23,000.00 loan
![Page 20: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/20.jpg)
Interest Paid Interest Paid
$24,034.02$24,034.02 interest paid interest paid by Bernie by Bernie over 20 yearsover 20 years
![Page 21: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/21.jpg)
Student Loans Student Loans • John John $19,000 $19,000
• APR 8.25%APR 8.25%
• 15 year loan 15 year loan
![Page 22: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/22.jpg)
Student Loans $19,000 Student Loans $19,000 • Clear registers Clear registers 2nd CE/C CE/C2nd CE/C CE/C• Loan AmountLoan Amount 19,000 PV19,000 PV
• Periods Periods 15 x 12 = 180 N15 x 12 = 180 N• % Rate % Rate 8.25 8.25 12 = 0.69 %i12 = 0.69 %i
• CPT PMT 184.33 CPT PMT 184.33 (don’t clear)(don’t clear)
![Page 23: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/23.jpg)
Interest Paid Interest Paid
• $184.33 payment$184.33 payment
• x 180 # of periodsx 180 # of periods
$33,178.80 paid$33,178.80 paid
- 19,000.00 loan amount- 19,000.00 loan amount
![Page 24: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/24.jpg)
Interest Paid Interest Paid • $14,178.80 interest $14,178.80 interest
paid by John over paid by John over 15 years15 years
![Page 25: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/25.jpg)
SummarySummary
•CalculatedCalculated•PaymentsPayments
•Interest paidInterest paid
![Page 26: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/26.jpg)
Student Loan Student Loan • Payment knownPayment known• How long to pay off How long to pay off
debt?debt?
![Page 27: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/27.jpg)
Student Loans Student Loans • Red’s Loan Red’s Loan $23,965$23,965
• APR APR 8.258.25%%
• $250$250 payments payments
![Page 28: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/28.jpg)
Student Loan Student Loan • Clear registers Clear registers 2nd CE/C CE/C2nd CE/C CE/C• Loan AmountLoan Amount 23,965 23,965 PVPV
• Payment Payment 250 PMT 250 PMT• % Rate% Rate 8.25 8.25 12 = 0.69 %i 12 = 0.69 %i • CPT NCPT N (months) (months) 157.04157.04
• 12 = 13.09 years 12 = 13.09 years ((don’t clear)don’t clear)
![Page 29: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/29.jpg)
Compute interest paidCompute interest paid
• Press again: Press again:
• CPT N 157.04CPT N 157.04
• # of monthly # of monthly paymentspayments
![Page 30: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/30.jpg)
Interest Paid Interest Paid
157.04 months157.04 months
x $250 paymentsx $250 payments
$ 39,260.99 paid back$ 39,260.99 paid back
- 23,965.00 - 23,965.00 loan amountloan amount
![Page 31: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/31.jpg)
Interest Paid Interest Paid
• $15,295.99 interest $15,295.99 interest paid by Red over paid by Red over 13.09 years13.09 years
![Page 32: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/32.jpg)
What if ??? What if ???
• Increase payment from Increase payment from $250$250 to to $350$350 ….just change ….just change the payment amount the payment amount
PMTPMT
![Page 33: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/33.jpg)
Student Loan Student Loan • Clear registers Clear registers 2nd CE/C CE/C2nd CE/C CE/C• Loan AmountLoan Amount 23,965 23,965 PVPV
• Payment 350 PMTPayment 350 PMT• % Rate% Rate 8.25 8.25 12 = 0.69 %i 12 = 0.69 %i • CPT N (months) 92.87CPT N (months) 92.87
• 12 = 7.74 years 12 = 7.74 years (don’t clear)(don’t clear)
![Page 34: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/34.jpg)
Interest Paid Interest Paid 92.87 months92.87 months
x $350 paymentsx $350 payments
$ 32,503.53 paid back$ 32,503.53 paid back
- 23,965.00 - 23,965.00 loan amountloan amount
![Page 35: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/35.jpg)
Interest Paid Interest Paid
• $8,538.53 interest $8,538.53 interest paid paid by Red over by Red over 7.74 years7.74 years
![Page 36: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/36.jpg)
The differenceThe difference• $250 13.09 yrs = $15,295.99$250 13.09 yrs = $15,295.99
• $350 7.74 yrs = $ 8,538.53$350 7.74 yrs = $ 8,538.53
$6,757.46$6,757.46
![Page 37: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/37.jpg)
Central IdeaCentral Idea• By increasing the amount of By increasing the amount of
paymentpayment• A loan can be paid A loan can be paid
off sooner off sooner
• You pay less INTERE$TYou pay less INTERE$T
![Page 38: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/38.jpg)
Student Loans Student Loans • Troy’s Loan Troy’s Loan $34,000$34,000
• APR APR 8.258.25%%
• $300$300 payments payments
![Page 39: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/39.jpg)
Student Loan Student Loan • Clear registers Clear registers 2nd CE/C CE/C2nd CE/C CE/C• Loan AmountLoan Amount 34,000 34,000 PVPV
• Payment Payment 300 PMT 300 PMT• % Rate% Rate 8.25 8.25 12 = 0.69 %i 12 = 0.69 %i • CPT NCPT N (months) (months) 220.44220.4412 = 18.37 years 12 = 18.37 years (don’t clear)(don’t clear)
![Page 40: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/40.jpg)
Compute interest paidCompute interest paid
• Press again: Press again:
• CPT N 220.44CPT N 220.44
• # of monthly # of monthly paymentspayments
![Page 41: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/41.jpg)
Interest Paid Interest Paid 220.44 months220.44 months
x $300 paymentsx $300 payments
$ 66,132.34 paid back$ 66,132.34 paid back
- 34,000.00 loan - 34,000.00 loan
![Page 42: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/42.jpg)
Interest Paid Interest Paid • $32,132.34 interest $32,132.34 interest paid by Troy over paid by Troy over 18.37 years18.37 years
![Page 43: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/43.jpg)
Summary Summary • Student Loan Student Loan
Payment knownPayment known• Computed how long to Computed how long to
pay off debtpay off debt
• Interest paidInterest paid
![Page 44: How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans 2002](https://reader030.vdocuments.us/reader030/viewer/2022032800/56649d375503460f94a10805/html5/thumbnails/44.jpg)
How a Financial Calculator Can Help Teens Make Deci$ion$ about Student Loans
20022002