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WE’RE FIDELITY.
Family-owned company, 70 years experience
Provide a simple and straightforward experience so that you feel in control of your financial future
Home of financial education and research, along with specialists to work with you and help answer your questions
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TODAY’S WORKSHOP
Make smart choices with what you’ve got
Build a solid foundation for the future with just five simple money concepts
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ELECTRONICS GAMES HOUSE PHONE FOOD
SUNGLASSES SHOES CLOTHES MEDICINE WINE
FURNITURE TOOLS COMPUTER CAR FILMS FUEL
WHAT WOULD YOU DO WITH $1000?
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CONCEPT 1: BUDGET
Make the most of what you’ve got.
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• Felt shocked by how much you spend a month?
• Got hit with an unexpected expense?
• Tried budgeting and gave up?
HAVE YOU EVER?CONCEPT 1: BUDGET
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CONCEPT 1: BUDGET
Essentials Non-essentials
Long-term savingsShort-term savings
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CONCEPT 1: BUDGET
50%ESSENTIALS
15%RETIREMENT
5%SAVINGS
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• How do you stack up?
• How can you funnel your money into the right buckets?
ACTION PLAN
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CONCEPT 2: CREDIT
Use it to your advantage.
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WHAT DO YOU THINK…CONCEPT 2: CREDIT
• Of the phrases “good” and “bad” credit?
• Makes credit good or bad? How does that affect your money choices?
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FICO CREDIT SCORECONCEPT 2: CREDIT
PAYMENT HISTORY
LENGTH OF HISTORY
NEW CREDIT
CREDIT UTILIZATION
CREDIT MIX
SOURCE: FICO
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CONCEPT 2: CREDIT
Check your credit health
Build credit as needed
Check your debt load
Read the fine print
Pay on time & pay at least the minimum
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• How can you check on your credit health this week?
• How can you keep your credit history healthy?
ACTION PLAN
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CONCEPT 3: DEBT
Handle debt smartly.
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• In debt? How did you get there?
• Confused or frustrated about your debt?
• Completely debt free?
ARE YOU…CONCEPT 3: DEBT
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CONCEPT 3: DEBT
REPAY SAVE
+
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CONCEPT 3: DEBT
Build an emergency fund1 Contribute up to the
match on your 401(k)2 Pay off high-interest credit cards3
Pay off private student loans4 Contribute even
more to your 401(k)5 Tackle lower interest loans last6
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• Where are you on this map?
• Where do you want to focus first?
ACTION PLAN
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CONCEPT 4: INVEST
Reach your money goals.
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• About investing?• About the stock
market?
WHAT DO YOU THINK OF WHEN YOU HEAR…
CONCEPT 4: INVEST
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COMPOUNDINGCONCEPT 4: INVEST
Risk involved (as compared to a savings account)
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CONCEPT 4: INVEST
SHORT TERM0-5 Years
LONG TERM+5 Years
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CONCEPT 4: INVEST
LOWER RISK HIGHER RISK
Cash (short term) Bond or fixed incomeStocks (equities) andInternational stocks
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ASSET ALLOCATION ANDDIVERSIFICATION IN ACTION
Cash (short term)
Bond or fixed income
Stocks (equities)
Mutual fund
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• What goals do you have?
• How would investing help you reach these goals?
ACTION PLAN
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CONCEPT 5: RETIRE
Tackle retirement (even today).
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• When you hear the word retirement?
• You’ll need to retire?
WHAT DO YOU THINK…CONCEPT 5: RETIRE
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COMPOUNDINGCONCEPT 5: RETIRE
This hypothetical example assumes the following (1) $5000 annual IRA contributions on January 1 of each year for the age ranges shown, (2) an annual rate of return of 7% and (3) no taxes on any earnings within the IRA. The ending values do not reflect taxes, fees or inflation. If they did, amounts would be lower. Earnings and pre-tax (deductible) contributions from Traditional IRAs are subject to taxes when withdrawn. Earnings distributed from Roth IRAs are income tax free provided certain requirements are met. IRA distributions before age 59 1/2 may also be subject to a 10% penalty. Systematic investing does not ensure a profit and does not protect against loss in a declining market. This example is for illustrative purposes only and does not represent the performance of any security. Consider your current and anticipated investment horizon when making an investment decision, as the illustration may not reflect this. The assumed rate of return used in this example is not guaranteed. Investments that have potential for a 7% annual rate of return also come with risk of loss.
25 35 70AGE
$1.5M
$.5M
$1M
Hypothetical illustration
– $796,687
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COMPOUNDINGCONCEPT 5: RETIRE
This hypothetical example assumes the following (1) $5000 annual IRA contributions on January 1 of each year for the age ranges shown, (2) an annual rate of return of 7% and (3) no taxes on any earnings within the IRA. The ending values do not reflect taxes, fees or inflation. If they did, amounts would be lower. Earnings and pre-tax (deductible) contributions from Traditional IRAs are subject to taxes when withdrawn. Earnings distributed from Roth IRAs are income tax free provided certain requirements are met. IRA distributions before age 59 1/2 may also be subject to a 10% penalty. Systematic investing does not ensure a profit and does not protect against loss in a declining market. This example is for illustrative purposes only and does not represent the performance of any security. Consider your current and anticipated investment horizon when making an investment decision, as the illustration may not reflect this. The assumed rate of return used in this example is not guaranteed. Investments that have potential for a 7% annual rate of return also come with risk of loss.
25 35 70AGE
$1.5M
$.5M
$1M
Hypothetical illustration
– $1,641,122
– $796,687
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Compounding growth
Variety of investment options
Opened as an individual
INDIVIDUAL RETIREMENT OPTIONS
IRA ROTH IRA
TAXES AND WITHDRAWALS
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INDIVIDUAL RETIREMENT OPTIONS
Which one makes sense for you?
Tax on deposited funds
Early withdrawals incur penalties
Taxed upon withdrawal
IRA Roth IRA
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• Open an account• Make it automatic• Meet the match• Bump up your
contributions
GIVE YOUR FUTURE SELFCONCEPT 5: RETIRE
A FINANCIAL BOOST
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• What’s one thing you can do in the next year to give your future self a boost?
ACTION PLAN
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EDUCATION: Articles, videos, tools and more
ACTION: Simple ways to take action
UPDATES: Follow @fidelity for updates and find us on Facebook
FOR MORE INFORMATION
fidelity.com/mymoneynow
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Thank you!
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IMPORTANT INFORMATION
Investing involves risk, including the risk of loss.
Diversification and/or asset allocation does not ensure a profit or guarantee against loss.
As with all your investments through Fidelity, you must make your own determination as to whether an investment in any particular security or securities is consistent with your investment objectives, risk tolerance, financial situation, and your evaluation of the security. Fidelity is not recommending or endorsing any investment by making it available to its customers.
Fidelity does not provide legal or tax advice. The information herein is general and educational in nature and should not be considered legal or tax advice. Consult an attorney or tax professional regarding your specific situation.
In general, the bond market is volatile, and fixed income securities carry interest rate risk. (As interest rates rise, bond prices usually fall, and vice versa. This effect is usually more pronounced for longer-term securities.) Fixed income securities also carry inflation risk, liquidity risk, call risk, and credit and default risks for both issuers and counterparties. Unlike individual bonds, most bond funds do not have a maturity date, so avoiding losses caused by price volatility by holding them until maturity is not possible.
Stock markets are volatile and can fluctuate significantly in response to company, industry, political, regulatory, market, or economic developments. Investing in stock involves risks, including the loss of principal.
Fidelity Brokerage Services LLC, Member NYSE, SIPC, 900 Salem Street, Smithfield, RI 02917
© 2016 FMR LLC. All rights reserved.
755890.1.2
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Q&A