1

Money

Management Class

For more information contact the class coordinator:

MM@foundcom.org (512) 815-7184

2

3

Staff use only Recertification Indicator Status

☐ Annual ☐ No Change or Change (Check one):

☐ Residency ☐ Income ☐ Family Size ☐

Identification _____________/____________ Staff Initials and Date of Receipt

(V-IND)

☐ Yes ☐ No

(Housing)

☐ Stable ☐ At-risk of Losing ☐

Homeless Certification

Financial Education Intake Survey

All information you provide during any class or one-on-one session will be kept confidential.

First Name: Last Name: Start Date: / /

Date of Birth: / / Gender: ☐ Female ☐ Male ☐ Transgender

☐ Male

Race: ☐ White ☐ African American ☐ American Indian/AK Native

☐ Asian ☐ Native Hawaiian/ Pacific Islander ☐ Other

Ethnicity: ☐ Hispanic ☐ Non-Hispanic

Highest Level of Education: ☐ K-12 ☐ High School Diploma or GED ☐ Some College

☐ Certificate ☐ 2-Year Degree ☐ 4-Year Degree ☐ Graduate Degree

Are you currently a student at Austin Community College? ☐ Yes ☐ No

Address: Apartment #:

City: State: Zip Code:

Email:

Home Phone Number: Cell Phone Number:

Do you live in a Foundation Communities property? ☐ Yes ☐ No

If yes, which one? ____________

Number of people living in your household (including yourself, spouse/partner, children, etc.):

Do you own or rent where you live? ☐ Own ☐ Rent ☐ Other:

Check the public benefits you or anyone in your household currently receives:

☐ SNAP ☐ WIC ☐ Medicare ☐ CHIP ☐ Medicaid ☐ MAP

☐ HACA Housing Choice Voucher ☐ HACA Public Housing ☐ Other: ☐ None

Are you self-employed or did you receive a 1099-MISC from an employer? ☐ Yes ☐ No

All Family Members Living in Same House as Client Who Share an Income Relationship

Date of Birth Source of Income

Gross Income for the Last 30 Days

(Please list every family members, even if they do not earn an income)

(Employer, TANF, Social Security Benefits, Unemployment, etc.)

(before taxes and deductions)

Self

TOTAL FAMILY INCOME FOR LAST 30 DAYS:

Commented [TW1]: The intake papers will be assigned as homework. Students should bring them back completed to the following class.

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Do you participate in your employer’s retirement plan (401(k), 403(b), pension)? ☐ Yes ☐ No ☐ Not Applicable

If yes, type of account Approximate Value

Do you have any investments outside of your employer’s retirement (IRA, 529 College Savings, stocks, bonds, etc.)?

☐ Yes ☐ No

If yes, type of account Approximate Value

Do you have a checking account? ☐ Yes ☐ No

Do you have a savings account? ☐ Yes ☐ No

If yes, what is the current balance in your savings account?:

Do you regularly make deposits into your savings account? ☐ Yes ☐ No ☐ Not Applicable

Do you currently use any of the following services?

☐ Pay Day Loans ☐Short Term Cash Loans ☐ Auto Title Loans

☐ Pawn Loans ☐ Check Cashing Services ☐ None

In the last six months, I have (check all that apply):

☐ Created and am following a spending or budget plan

☐ Created a debt reduction plan

☐ Paid my bills on time

☐ Reduced my debt

☐ Reduced my spending

☐ Set goals for my financial future

☐ Made progress towards at least one goal

I am here because I want to (check all that apply):

☐ Organize my financial paperwork.

☐ Create a spending plan or budget.

☐ Spend less.

☐ Lower my monthly bills.

☐ Learn more about checking or savings account options available to me.

☐ Repair or establish credit.

☐ Learn about managing my money online.

☐ Learn about direct deposit.

☐ Save for:

☐ my education ☐ my child’s education

☐ buying a car ☐ buying a house

☐ emergencies or rainy day fund ☐ my retirement

☐ other: ____________________

☐ Reduce the amount of debt I have. Please list dollar amount of debt in each category below.

Unpaid Medical bills: Mortgage:

Car Loan: Student Loans:

Collections: Other:

Credit Cards: Other:

In your words, what would you like to get out of Financial Coaching?

____________________________________________________________________________________________________

____________________________________________________________________________________________________

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Do you currently have a personal budget, spending plan, or financial plan?

☐ Yes

☐ No

How confident are you in your ability to achieve a financial goal you set for yourself today?

☐ Not at all confident

☐ Somewhat confident

☐ Very confident

If you had an unexpected expense or someone in your family lost a job, got sick or had another emergency, how confident are you that your family could come up with money to make ends meet within a month?

☐ Not at all confident

☐ Somewhat confident

☐ Very confident

Do you currently have an automatic deposit or electronic transfer set up to put money away for a future use (such as savings)?

☐ Yes

☐ No

Over the past month, would you say your family’s spending on living expenses was less than its total income?

☐ Yes

☐ No

In the last two months, have you paid a late fee on a loan or bill?

☐ Yes

☐ No

Are you required to participate in Financial Coaching or Money Management?

☐ Yes ☐ No

If yes, by which agency or program?

How did you hear about Financial Coaching or Money Management?

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Money Management

Attendance Agreement:

My initials next to each statement indicate that I have read and agree to the terms of the class: _____ I understand that I must attend all three classes in order to get a certificate of

completion. _____ If I have to miss a class, I will notify the program coordinator, at least 24 hours in

advance. MM@foundcom.org or (512) 815-7184. _____ I understand that if I miss a class, I am still eligible to get my certificate of completion IF

I make up the same class another month. For example: If you miss class one, you must make up class one. The class series is held every month on different Foundation Communities properties. For the schedule, please go to: http://foundcom.org/financial-stability/money-management-classes/

______ I will arrive to class on time, come prepared, and actively participate. ______ I will complete all assignments as required by the class. ______ I will be respectful of my instructor and fellow students.

By signing below, I certify that I have read and understand the terms and conditions of completing the money management course. ___________________________________ Print Name ___________________________________ _______________________ Signature Date

Commented [TW2]: Attendance can fluctuate for each class. Explain that the class is a three part series and that each class builds off of the last.

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Pre-Test

Name: ________________________________ Date: _____________________________

1. Which of the following is NOT one of the three national credit reporting bureaus? Equifax (EFX) Fico (FCO) TransUnion (TUC) Experian (XPN)

2. Paying more than the minimum balance on a credit card each month will reduce (1) the

amount of money you will have to pay and (2) the amount of time it will take to pay off the card.

True False

3. Which is a way of “paying yourself first” by setting aside money to apply toward the

things you’d like to achieve later in life?

Budgeting Spending Saving Planning

4. Bankruptcy is the best option for eliminating all debt.

True False

5. Which of the following has the biggest impact on your energy bill?

Refrigerator Lights Heat and Air Conditioning Television

6. A negative financial event, such as a delinquent payment or a loan default, stays on your credit report for how long? 5 years 3 years 7 years Forever

7. Which of the following will not improve your credit score?

Paying bills on time Maintaining a balance under 30% of the credit card limit Paying cash for everything

8. Which factors are most important when calculating your credit score?

Credit inquiries & amounts owed Length of credit history & amounts owed Payment history & amounts owed

FLIP OVER

Commented [TW3]: Everyone should complete and hand in this “test” before the class starts. Let them know that it is okay to guess. It’s to track to see if they have learned anything by the end of the class series.

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9. Pick the green action(s) that can save you money (Check all that apply).

Make homemade cleaners Wash dishes by hand 5-minute showers

10. It’s only free to look at once a year but you are always entitled to look at your credit report.

True False

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Table of Contents

Section I – Reaching Financial Your Goals

Intake Forms – Please Fill Out & Turn In

Pg. 3-8

The Bean Game Pg. 13

Needs Vs. Wants Pg. 14

Why Is It Important to Have a Budget?

Pg. 15

Types of Budget Pg. 16-22

SMART Goals Pg. 23-24

Financial Priorities Pg. 25

Reducing Expenses Pg. 26

Maximizing Your Income Pg. 27

Savings Pg. 28-31

Retirement Savings Pg. 32-33

Education Savings Pg. 34

Josephine & Mark’s Budget Pg. 35

Daily Expense Tracker Pg. 37

Section I- Reducing Expenses by Saving Green

Key Spots to Save Pg. 41

Energy Pg. 42

Water Pg. 43

Indoor Air Pg. 44

Recycling Pg. 45

Saving Green Pg. 46

Can I Recycle This? Pg. 49-50

Section II – Freedom From Debt & Giving Yourself Credit

Create Your Own Budget Pg. 53

Excuses for Spending Money Pg. 55

Types of Debt Pg. 56

Payday Loan and Auto Title Loan Pg. 57-58

A Lifetime of Debt Pg. 59

Dealing with Debt Pg. 60-62

Bankruptcy Pg. 63

Credit Pg. 64-69

Commented [tw4]: Reflect back to this table of content for exact page numbers. Due to the notes the pages in the instructor manual are slightly different than the pages in the student handbook.

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Do-it-Yourself Credit Repair Pg. 70

Negotiating with Creditors Pg. 71

Know Your Rights Pg. 72

Marriage and Credit Pg. 73

Section III – Giving Yourself Credit Continued…

12 Steps to Protect Your Identity Pg. 77

Internet Scams Pg. 78-79

Players in the Credit Game Pg. 80

Consumer Reports Pg. 81

Credit Score Pg. 82-83

What’s in a Credit Report? Pg. 84

Reading the Credit Report Pg. 85-90

Corrections to the Credit Report Sample

Pg. 91

Accounts in Collections Pg. 92-94

Proposal to Settle Account Sample Pg. 95

Resources

Foundation Communities Programs Pg. 99

Resources for Achieving Your Financial Goal

Pg. 100-101

Don’t Forget to Budget in Some Fun Pg. 102

Community Resources Pg. 103

Eating Healthy on a Budget Pg. 104

Professional Development Pg. 105

Reducing Expenses Worksheets Pg. 106-109

Post Test Pg. 112-113

Course Evaluation Pg. 114

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Money Management

Section I:

Reaching Your

Financial Goals

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The Bean Game

Managing money means making choices. There is never enough money available for all of the things we would like to have or do. This game will help you decide what is most important to you.

How to Play: Divide participants into groups of 2 to 5 people. Each individual/group receives 20 beans and a set of spending category sheets. The individual/group must decide how to spend their “income” based on life circumstances, values, and goals. Each item has a set number of squares, which indicates how many beans are needed to “pay” for that item. Round #1: First, each individual/group must select one item in each of the categories with the gold stars (Food, Housing, Furnishings, Transportation, Insurance and Clothing & Laundry). Once you have finished selecting items in the required categories, continue selecting items until you have used up your 20 bean income. Discussion Questions: Why did you choose the items you did? In what ways were you influenced by your own values? Your goals? Your previous experiences? Compare what you spent your beans on with another group. Round #2: Your income has just been cut to 13 beans. What will you give up? What changes will you make? Make changes until you only have 13 beans on your spending sheets. Discussion Questions: What kinds of items did you choose to give up? Why? What did you learn about yourself and money in this process? Compare your budget cutting choices with another individual/group. Optional Round 3 or 4 life changes: Round 3: Someone in the family just broke their leg. If you have insurance, you don’t need to do anything. If you don’t, take off 3 beans. Round 4: You just got a 2 bean raise! Decide where it should be spent. Recreated and Reproduced by: Jana Darrington, M.S.Family and Consumer Science Agent Utah State University Extension, Utah County http://extension.usu.edu/utah/files/uploads/Finance/THE%20BEAN%20GAME.pdf

Commented [TW5]: Objective: To help illustrate money management in a real life scenario. Total Time: 20 minutes Critical Knowledge: Budgets are constantly changing and can help us get through the unexpected. It’s important for student to know that they unexpected can always be expected.

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Activity: Needs Vs. Wants

Categorize the list of budgeted items and place a “N” next to the if it is a need or a “W” if it is a want. The first one has been completed for you.

Is it a need or a want?

N = Need W = Want

Rent/Mortgage N

Groceries

Eating Out

Hair Care

Hobbies

Coffee from a coffee shop

Renters Insurance

Alcohol/Tobacco

Debt Repayments

Internet/Cable

New Clothes

Car payments (gas, insurance, etc.)

Savings

New technology (phone, TV, laptop, etc.)

Commented [TW6]: Objective: To help define the difference between needs and wants for each individual. Total Time: 10 minutes Critical Knowledge: Needs vary by household based on culture and personal priorities.

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Why it is Important to Have a Budget

What is a Budget? A budget, sometimes called a spending plan, helps you know what your income and expenses are every month. It can give you control over your money because a budget is all about choices. You choose how to use your money. A budget is a living document. You may create one today, but you’all have to revisit it periodically and make adjustments. Why Budget? A budget is the most effective financial management tool available to all of us. Whether you are earning thousands of dollars or hundreds of thousands of dollars annually, a budget is the most fundamental part of achieving your financial goals. It is extremely important to know how much money you have to spend and where you are spending it. What Do You Accomplish with a Budget? Budgets are the foundation to your financial success. Once we are on our own and begin making, spending and investing money, budgets are our plan to guide us. Budgeting is about planning, which is crucial to produce a desired effect.

Commented [TW7]: Objective: To give students a workable knowledge of budgets, so they can complete one on their own. Critical Knowledge: The budget is at the heart of all our financial decisions. It’s not just a document to analyze your present situation, but also to plan for goals and fun. It might seem constraining to follow a budget, but it ultimately gives you more control, and thus: more freedom!

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Types of Budgets

There is no one right way to create a budget. You have to find system that works for you. Listed below are types of budgets for you to try and see what type of budget fits you best. Envelope Budgeting: (Adapted from www.DaveRamsey.com) This system uses cash envelopes to control your monthly spending, Here are a few basic steps to start a cash envelope system:

1. Budget each paycheck. Budget is a dirty word to most people, but you must budget down to the last dime if you're going to successfully implement the envelope system.

2. Divide and conquer. Of course, there will be budget items that you cannot include in your envelope system, like bills paid by check or automatic withdraw. However, you can create categories like food, gas, clothing and entertainment.

3. Fill 'er Up. After you've categorized your cash expenses, fill each envelope with the money allotted for it in your budget. For example, if you allow $100 for clothing, put $100 in cash in your clothing envelope for the month.

4. When it's gone, it's gone. Once you've spent all the money in a given envelope, you're done spending for that category. If you go on a shopping spree and spend the $100 in your clothing envelope, you can't spend any more on clothes until you budget for that category again. That means no visits to the ATM to withdraw more money!

5. Don't be tempted. While debit cards can't get you directly into debt, if used carelessly, they can cause you to over-spend. There's something psychological about spending cash that hurts more than swiping a piece of plastic. If spending cash whenever possible can become a habit, you'll be less likely to over-spend or buy on impulse.

6. Give it time. It will take a few months to perfect your envelope system. Don't give up after a month or two if it's not clicking. You'll get the hang of it and see how beneficial the envelope system is as you dump debt, build wealth, and achieve financial peace! See ... simple!

Certainly, some bills may come in at different times of the month, so you'll need to adjust your

written game plan to take it one step further. You need to plan the budget based upon your

pay periods.

Commented [TW8]: Objective: To show the students that there are many different ways to budget. Critical Knowledge: What might work for someone doesn’t have to work for you. Find a budget that best fits your needs/lifestyle.

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Types of Budgets Continued

Envelope Budgeting Continued: Say that

you get paid twice a month. If you can write

down which bills you plan on paying from

each paycheck, you will not be left with a

surprise bill. Spend each month's income and

each individual paycheck on paper before it

comes in.

Have Some Fun!

I also have no problem with you adding an

envelope with money just to have fun with! As long as you and your spouse have agreed on it,

you are fine. There should be no lying. Agree on your budget, agree on your fun money, and

be open. Fun money can be anything you want it to be. There are no rules on that

envelope, unlike money in the "entertainment" envelope that is used specifically for

entertainment.

Paper and Pencil Budget: This can be a calendar budget, or a type of budget worksheet. The following page has an example of a bill calendar.

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Example of a Bill Calendar

This calendar can provide you with a visual organization of the regular monthly bills, how much they are and when you will need the money for them. Use the Create Your Own Budget template, and place your own bills at the approximate time of the month that they are due, along with how much is due to

help you organize your monthly spending.

Sunday Monday Tuesday Wednesday Thursday Friday Saturday

1 Rent: $650

Health insurance:

$50

2 3 4 5

Cell phone: $30

6 7

8

9 10

Credit card: $25

11 12 13

Payday: $600

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15

Childcare: $200 Car

insurance: $100

16 17 18

City of Austin utilities: $100

19 20 21

22

23 24

25

Cable bill: $45

26 27

Payday: $600

28

Student loan payment: $89

29 30 31

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Create Your Own Bill Calendar

Month ………….……. Year ………….…….

Sunday Monday Tuesday Wednesday Thursday Friday Saturday

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Types of Budgets Continued

Microsoft Excel Document: You can use a Microsoft Excel budget document to help you keep track of your budget. For free budget templates visit: https://templates.office.com/templates/Budgets?ui=en-US&rs=en-US&ad=US

Budgeting Computer Software: This system is a computer based budgeting option using software for example, Quicken.

Online/Application Budgeting: This type of budget can be used through an application on your smart phone or tablet and or on a computer: For example: www.mint.com, www.mvelopes.com

Mint.com

For a fresh view of your big financial picture, Mint.com is our favorite. The online

money-management tool lets you easily track all your accounts: checking, savings,

credit, loan and investment. Signing up is fast and free; to get started, you need only

provide an e-mail address and zip code, then select a password.

Next, link up your accounts. The site connects to more than 7,500 U.S. financial

institutions and is adding more. You have to provide user names and passwords for all

your bank accounts, but don't worry: The site maintains a secure connection. All user

names and passwords are encrypted so that no one at Mint ever sees them. And you

don't provide the site with any personal information besides your e-mail and zip code.

Mint updates all your accounts at least once a day and automatically labels each

expense with a category -- groceries, credit-card payments, gas and so on. You can use

customized tags to create more-specific categories, and you can add notes to each

transaction. The site also offers personalized savings tips, such as suggesting better

credit cards for cash rebates and travel rewards.

Content taken from From Kiplinger's Personal Finance magazine, March 2009

Mvelopes.com

Mvelopes is a web-based personal finance software that takes the traditional envelope budgeting method to the next level by using digital envelopes to manage your budget and cashflow.

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Simple Steps to Create a Budget

1. Perform an honest assessment of your monthly expenses. Then categorize & write

them all down.

2. Total your earnings/income.

3. Determine if your living expenses are compatible with your income, by subtracting your

monthly expenses from your income. If they are not compatible find realistic ways to

rework your budget, so that your expenses are not more than your earnings.

4. Put your budget to work!

*Remember your budget is a living document so occasionally revisit it, and make sure

it’s still an honest and accurate reflection of your expenses and income.

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SMART Goals

Knowing what you are going to accomplish makes the path much easier to navigate. SMART goals are specific, measurable, aggressive, achievable, realistic and time-sensitive. S Specific M Measurable A Aggressive yet achievable R Realistic T Time-sensitive For example:

Goal: I will lose weight.

SMART goal: In the next 3 months I will lose 10 pounds. I will work out 30 minutes a day, 5 days a week.

Is it: Specific? Measurable? Aggressive? Achievable? Realistic? Time-sensitive? Now, create your own SMART goal. This does not have to be financially related, but it does need to fit the criteria of a SMART goal. Examples of goals:

1) Find a low cost way to manage my money (i.e. bank account, prepaid/loadable card) 2) Track my daily flexible expenses for one month to find if I have any money holes 3) Shop around for car insurance to make sure I’m getting the best rate 4) Learn to cook low-cost, healthy meals to feed my family 5) Reduce my electricity bill by $5/month 6) Reduce my gas (for car) expense by $5/month 7) Open a savings account and deposit $25

(Note that some of these are not yet SMART goals) SMART GOAL: ______________________________________________________________________ Is it: Specific? Measurable? Aggressive? Achievable? Realistic? Time-sensitive?

Commented [TW9]: Objective: Show students how specificity makes a goal easier to manage. Critical Knowledge: Goals are the strongest when they can find a way into your daily routine. And if you fall short of a goal, don’t consider it a failure—you can always adjust the goal to take new obstacles into account.

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Making Behavior Changes to Reach Your SMART Goals

Setting Financial Goals

What is your goal?

What is your vision?

What do you want to achieve?

Where do you want to be? What is your current situation?

Where are you now in the context of your financial goal?

What have you already done?

What are your strengths?

What are your challenges?

How satisfied are you in the financial areas that affect your financial goal?

What’s important to you that will drive your decisions and actions? What steps will you take to get from here to there?

How will you get from where you are now to where you want to be?

What do you think needs to be changed to reach your goal?

What opportunities exist?

What options do you see as open?

Where might you get stuck?

What’s going to help you be successful?

What next steps will you commit to take? What mechanisms will keep you on track?

What will you do by when?

How will you hold yourself accountable for doing it?

Adapted from Financial Coaching Training Manual by a collaboration of Central New Mexico Community College and New Mexico Project for Financial Literacy, 2010

Commented [TW10]: Critical Knowledge: Please explain this worksheet to students and the importance of making behavior changes in terms of money management. These are all great questions to help them identify any changes they will need to make in order to achieve their SMART goal.

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Activity: Financial Priorities

There are a lot of different ways to spend a dollar. These questions will help you recognize

your financial priorities and values. You can have family members or your partner complete

the activities as well and then discuss the similarities and differences.

1. I just won $5,000 in the lottery. This is what I'd like to do with the money:

______________________________________________________________________

2. I have just been laid off from my job. I must make a major cut in spending. The first thing to

go is: ________________________________________________________

3. I would like to see me/us spend more money on ____________________________

and less money on ________________________________________.

Financial Goals

The reason to plan is to make sure that you’re spending your money on things that are the most important to you – your priorities. For each financial goal, figure out the total amount needed, the date you want to reach your goal, and how much you need to save monthly. For example, if you want $500 in your emergency fund in one year, you need to save around $42 every month.

Financial Goals Total Amount Needed

Date Needed (in months) (6 months, 24 months, etc.)

Amount to Save Monthly (Divide the total needed by the number of months)

Example: Emergency Fund

$500 12 months $42 ($500 / 12)

Total amount need to save monthly:

Are you able to save enough money each month for all your goals? Most people have more goals than they do money. The next step is to prioritize which goals come first.

Check out this online calculator to help prioritize financial goals: http://cgi.money.cnn.com/tools/prioritize/prioritize_101.jsp

Commented [TW11]: Objective: Have students complete this worksheet so they can see what are their financial priorities and values. Total Time: 10 minutes Critical Knowledge: How did these priorities differ from their SMART goals? Were they the same?

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Reducing Expenses

One of the most important commitments you can make to getting out of debt is to reduce your spending. Reduced spending can prevent debt from increasing and make more money available to put toward paying off your existing debt. Where can you cut your expenses? Everyone has a few black holes where money seems to disappear. If you can pinpoint those black holes, you can plug them up. The following are some examples of black holes and how much they really cost.

Item/Frequency Price Per Unit Cost Per Year

Buying Lunch at Work 1 per weekday

$8.00 $2,080

Late Fees on Bills 1 per month

$35.00 $420

Coke/Bottle of Water 1 per weekday

$1.50 $390

Lottery Tickets 5 a week

$2.00 $520

Morning Coffee Shop 1 every weekday

$3.00 $780

ATM Fees 5 per month

$3.00 $180

Cigarettes 3 packs per week

$7.00 $1,092

Your Commitment To Cut Spending: Take a look at your daily expense record. Is there anything you can commit to reduce spending on?

Item Commitment Price Per Unit Yearly Savings

Example: Going out to eat with the family

Go once a month instead of every

week $40

$1,600 ($2,080 to go out every week minus

$480 to go out once a month)

1.

2.

Commented [TW12]: Objective: To give students a model for identifying habits that can change. Critical Knowledge: Our small decisions have a large effect over time. “How we spend our days is, of course, how we spend our lives.”

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Possible Strategies to Maximize Your Income

Name 10 ways to maximize your income this year:

1.

2.

3.

4.

5.

6.

7.

8.

9.

10.

Examples for how you can maximize your income:

1. Sell your unwanted or unneeded stuff online

2. Take maximum advantage of your company’s 401(k) retirement benefits

3. Rent out an unused room in your house or rent space in your garage

4. Arrange for a direct deposit of your paycheck into a high-yield savings or money market account

5. Collect deposit bottles and return them for the deposit

6. Hold a garage sale and sell unused stuff from your garage and attic

7. Start a small home business and sell your work online

8. Take a second job in the evenings or weekends

9. Work with a tax preparer at Foundation Communities to see if you qualify for tax credits or deductions

10. Try to limit your use of credit cards and visit to the ATM

11. Find cheaper ways to entertain yourself

12. Borrow books and DVDs from the public library rather than renting or buying them

13. Vacation at home this year

14. Take a vacation from spending for a week each month

15. Ride your bike or walk to work as much as possible

16. Make low-cost energy improvements to your house or apartment

17. Use solar lights outside to light your porch and garden

18. Grow your own food and herbs this year

19. Go out to eat fewer times

20. Learn to do simple home repairs yourself

21. Negotiate with your cable company and reduce your cable bill by half

Adapted from www.bripblap.com and www.askmen.com

Commented [TW13]: Objective: Discuss this worksheet with students. Maybe they are already doing all they can to earn extra income… or maybe they’re not. Below is a list of examples on how they can maximize their income. Let this be an additional resource that students can return to.

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The Importance of Having a Savings Account

A bank account offers many benefits for you and your money including: • Providing safety from hazards such as theft and fires, and your money will be federally insured. • Convenience paying by check is easier and cheaper than paying by money order. • Interest rates although small are a great way to help your money grow over time. • It’s cuts on the fees of check cashing or even low-cost money wiring. • Access to credit services that your bank offers such as home, automobile, student or personal loans.

Visit www.uwatx.org/banking to access the bank locator & savings calculator

Call 211 to learn how Bank on Central Texas can help you open a bank account. *Adapted from http://www.nyc.gov/html/ofe/html/save/benefits.shtml

How Can Savings Help You? When Alison’s car broke down she missed multiple days at work, and was let go. Unable to repair her car with cash, she took out a high interest loan and was able to fix her car and get another job. Being the newest employee means Alison often gets the worst shifts and is making less money. Meanwhile she is struggling to pay her late fees on bills she missed while out of work, and can’t commit much of her paycheck to paying back her loan. Every day it goes unpaid she is falling further into debt. How could an emergency savings account have helped Alison? ___________________________________________________________________________

___________________________________________________________________________

Commented [TW14]: Objective: Make students aware of the importance of a bank account. Critical knowledge: There are an overwhelming amount of banking options available. It’s fine to start with the basics and work your way up.

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Emergency Savings Account

An emergency savings acts as a buffer and financial stabilizer when the unexpected happens. It can help you avoid high interest loans, pawn shops, borrowing, or simply going without. Where do you start?

To set up an emergency fund, work on saving an amount equal to one month’s spending for

housing, utilities, food, transportation, and other regular expenses.

Then try to add at least 1% to this fund every month.

For example, if your basic living expenses equal $1400 per month, this would mean contributing $14 per month to your fund. Add more if you can.

How much do you need to save? Financial experts recommend keeping 3-6 months worth of your basic monthly living

expenses in an emergency fund. It’s never too late to start and the best time to start saving

is now!

What if you cannot save right now? Step one is to create a budget. Your budget can show you where there is room for savings. Even the smallest bit of savings every week, or month, can add up.

When you have savings to fall back on:

You have less stress and more security when there’s an emergency, like an

illness, accident, or loss of work.

If you fall short of money one month, you can still make your payments on time.

This will also help to build up your credit history.

You can get car or home repairs or medical care when needed rather than

waiting until you can find the money. Waiting may make the problem bigger and

more expensive.

You can select the best service provider, mechanic, or other help needed,

rather than relying on high interest credit.

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Emergency Savings Account Continued

Keep in mind that it can take several years to build up your emergency savings fund. Don’t get discouraged! Below is a chart that shows how much you can save if you start putting 1% or 5% of every paycheck into a savings account. Imagine how much you could save if you continued doing this for a couple years!

Annual Income Bi-Weekly paycheck Saving 1% of every paycheck for 1 year

Saving 5% of every paycheck for 1 year

$20,000 $769.23 $200 $1,000

$30,000 $1,153.85 $300 $1,500

$40,000 $1,538.46 $400 $2,000

$50,000 $1,923.08 $500 $2,500

$60,000 $2,307.69 $600 $3,000

*Bi-weekly paycheck is based off of a single individual’s income before taxes using paycheckcity.com.

Commented [TW15]: Objective: To show students that it’s never too late to start a savings account! Critical Knowledge: It’s important to remind students that this account will often fluctuate due to the unexpected… but that’s what it is there for! Rather than having to charge bills to your credit card you can pay for the unexpected with savings.

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Savings Choices

General descriptions of accounts adapted from www.Investorguide.com

*Requires an investment broker.

Basic Savings Account

• You can make deposits and withdrawals, but usually can't write checks. They usually pay an interest rate that's higher than a checking account, but lower than a money market account or CD

Certificate Deposit (CD)

• These are also known as "time deposits", because the account holder has agreed to keep the money in the account for a specified amount of time, anywhere from three months to six years.

Money Market Account

• These accounts invest your balance in short-term debt such as commercial paper, Treasury Bills, or CDs. The rates they offer tend to be slightly higher than those on interest-bearing checking accounts, but they usually require a higher minimum balance to start earning interest. *

Commented [TW16]: Objective: Inform students of the different savings options they have access to.

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Retirement Fund Basics

Two most common paths for retirement savings:

How to get one: Go to a credit union, local bank, brokerage firm, a mutual fund company, or just about any other financial institution. All you have to do is fill out some simple paperwork and deposit your money. Make sure to ask a lot of questions about which accounts you qualify for, which are best for you and about commissions or other fees you will pay.

• Tax-deferred contributions reduce your current income taxes since they are subtracted from your income before tax withholding is calculated. Many employers match a percentage of the contributions you make. Any earnings in your retirement account accumulate tax deferred, meaning that earnings are reinvested to increase the base on which additional earnings can accumulate, also known as compouding.

Employer Sponsored Plans- 401(k), Roth 401(k), 457, 403(b)

Typical Benefits

• This is great for people who are not eligible to participate in a 401(k) or similar plan. As long as you earn income or are married to someone who does, you can contribute to an IRA. Traditional IRA – deductible; pay taxes on withdrawals. Roth IRA – not deductible; no taxes on withdrawals if certain requirements are met. FYI- most retirement savings are not FDIC or NCUSIF insured – there is a small risk of losing money; risk varies depending on the specific investments chosen.

Individual Retirement Account (IRA)

Commented [TW17]: Objective: Inform students of the different retirement funds they have access to. myRA.gov is a great resource for anyone who has not started a retirement account. There is more information about this account in the resource section.

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Time Value of Money

The time value of money is how much your money will be worth over time. What do you need to make your retirement account grow over time? Patience.

Annual Investment Starting at the age of 30

and retiring at 65 Starting at the age of 50

and retiring at 65

$1,000.00 $147,913.00 $26,888.00

$1,500.00 $221,870.00 $40,332.00

$2,000.00 $295,827.00 $53,776.00

$2,500.00 $369,784.00 $67,220.00

*For the purposes of these calculations, we assume you are single, filing separately and contributing to a Roth IRA with an expected rate of return at 7% and the marginal tax rate at 25%. If you are interested in seeing how much you can save go to www.bankrate.com and use their retirement calculators!

Commented [TW18]: Critical Knowledge: To make students aware of the value of interest over time, and how they can make their money work for them!

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Education Savings

There are different types of accounts specifically designed to help parents and students save for future education. Check out the options below to see which one might be best for you and your family.

Plan Details

Coverdell Education Savings Account

Can contribute up to $2,000 per year per child under the age of 18

Contributions are not deductible (no upfront tax-break)

Withdrawals are tax-free as long as they are used for qualified education expenses

This type of account may be a good fit for someone putting their children in private school for k-12

Not FDIC-insured

529 Plan – Prepaid tuition

Paying tuition at today’s rates for a state’s public schools

Can be used for private schools and out-of-state schools

Typically only cover school-wide required fees (ex. Tuition)

Usually have to be a resident of the state, Not FDIC-insured

New program available called Texas Tuition Promise Fund* (www.texastuitionpromisefund.com)

529 Plan – College savings

Offered by most states

Has more flexibility than prepaid tuition plans

Can be used at any school, including for room and board costs

Each state determines the account limit, some are currently over $300,000.

Withdrawals are tax free if used for qualified educational expenses.

Tax free contributions are limited to $13,000 per year

Not FDIC-insured, not necessary to use your own state’s plan Texas 529 College Savings Plan*

Total contribution limit is $320,000 per beneficiary

As little as $15 can open an account with automatic savings

Offers 20 different investment options

Website: https://www.texascollegesavings.com/

Plans are rated at www.savingforcollege.com

Things to remember about saving for college

Your child can take out loans for school but you can’t take out loans for retirement

You need to balance helping your child get an education with taking care of yourself

If your child out loans, he or she shouldn’t take out more in loans than you can expect to earn in income during the first year out of school

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Monthly Take Home Income

Monthly Debt Payments

Salary or Wages (after taxes!) 2,000

Auto Loan (1) 320

Salary or Wages (spouse) 1,250

Auto Loan (2)

Social Security

Credit Card (1) 75

Retirement/Pension

Credit Card (2) 40

Child support/Alimony

Personal Loan (1)

Public Benefits

Personal Loan (2)

Other

Other

Other

Other

Total income: 3250

Total monthly debt payments: 435

Monthly Living Expenses

Semi-Annual & Annual Expenses

Rent or Mortgage 1,500

Per Year

Per month*

Utilities - Electric 70

Car insurance

Utilities - Gas 20

Car registration 60 5

Utilities - Water 20

Car inspection 30 3

Food - Groceries 450

Holiday gift giving 200 17

Food- Out of home 90

Birthdays 200 17

Phone (1) 40

Back to school 150 13

Phone (2) 65

Car maintenance/repairs

Internet 30

Other:

Cable 85

Other:

Transportation - Gas for car 70

Total monthly semi-annual & annual expenses: 55

Transportation - Bus passes

*To get the monthly figure, take the per year amount and divide by 12

Insurance - Health 350

Insurance - Dental

Summary

Insurance - Renter's

Total income 3250

Insurance - Life and Disability

Total monthly living expenses (-) 3040

Insurance - Car 150

Total monthly debt payments (-) 435

Child Care

Total monthly semi-annual & annual expenses (-) 55

Prescriptions 40

Total monthly savings (-) 0

Pet food 20

Over/Under: -280

Entertainment 40

Charitable contributions/Tithe

Other expense: ____________

Other expense: ____________

Other expense: ____________

Total monthly living expenses: 3040

Activity: Josephine and Mark's Budget

Josephine and Mark are married and have a 14 year old son named David. Each month, Josephine and Mark earn $3,250. They feel like there’s never any money left over at the end of the month. They are trying to manage their money better. Their first step was to put together a household budget. They have always kept their household budget “in their heads” and have never sat down and put it on paper. They have also decided on two financial goals: Reduce our monthly expenses and start a savings. What do you think they can do to achieve these goals?

Commented [TW19]: Objective: Have student review this budget in class or for homework. They should come back with ideas on how Josephine and Mark and reduce their monthly expenses and start a savings. Depending on time, discuss this budget. What did they notice? Where did they think this family could make changes? Critical Knowledge: No two budgets will be the same, and they will change over time. Be sure to point out the importance of budgeting for semiannual and annual expenses as an example of budgeting for irregular expenses.

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Daily Expense Tracker

Category Monday Tuesday Wednesday Thursday Friday Saturday Sunday Category Totals

Food/Groceries

Lunch/Dinner out

Auto Repairs

Gas/Transportation

Medical (doctor visit, medicine)

Snacks/coffee

Video rental

Laundry/dry cleaning

Gifts (holidays, birthdays, etc.)

Other holiday expenses

Church/other donations

Pet expenses

Clothing

Hair care

Hobbies

Entertainment

Books/magazines

Personal hygiene

Other

Other

Daily Totals

Commented [TW20]: Objective: Assign this as homework for the students. They will need to track their expenses throughout the next week. This will help them create their budget at the beginning of next week’s class!

37

Reduce Expenses: Saving Green

Money Management

Reducing Expenses

by Saving Green

38

39

Key Spots to Save:

I will use my thermostat appropriately

I will unplug unused electronics

I will take 5-minute showers

I will run a full dishwasher instead of washing dishes by hand

I will use homemade cleaners

I will stop using air freshening sprays and open my windows to freshen the air

I will use reusable bags, drink cups, food storage containers, and napkins whenever I can

I will recycle or donate old items

Money Saving Thermostat Settings!

When You Aren’t Home

Turn it OFF!

When You’re Home (In the Summer)

75⁰-80⁰

When You’re Home (In the Winter)

68⁰-73⁰

Commented [TW21]: Objective: The following worksheets highlights how people can save in their home by making some changes… they will also be helping the Earth as well!

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Heating

and

Cooling

52%

Lighting

6%

Water

Heating

14%

Appliances

17%

Other

11%

Reduce Expenses: Energy

Use Your Thermostat Appropriately!

The biggest energy user (HALF of total use!!) is your heating and cooling, so the best way to save money is by adjusting your thermostat. The table on the previous page gives the best suggestions for thermostat settings that balance comfort with savings!

Unplug Appliances to Avoid Plug Loads

Many appliances use electricity even when they are switched off, this is a plug load. Plug loads are mainly found with entertainment electronics such as DVD players, TVs, stereos, computers, and cable boxes. To avoid plug loads, you can either unplug unused electronics or put them on a power strip and switch the power strip off when not in use.

Turn off your fans when you aren’t in the room, it’s a myth that they help to circulate air!

Supplying hot water uses energy. Save electricity by taking 5-minute showers.

*

*Energy Savings worksheet is in back of the handbook on pg. 106

Indoor Energy Use by percentage of your

energy bill

Commented [TW22]: Students can complete these worksheets in the back of the handbook to see how much they will save if they use these tips!

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Toilets,

27%

Clothes

Washers,

22%Showers,

19%

Faucets,

16%

Leaks,

14%

Dishwashers,

2% Other, 2%

Reduce Expenses:

Water

Take a 5-minute Shower

Using a shower timer can save you between 13 and 25 gallons per shower. Save even more by turning off the water when you are lathering your hair or body.

Use the Dishwasher Instead of Hand- Washing

Hand-washing dishes can use up to 5 times more water than using your dish washer. Save even more by avoiding pre-scrubbing dishes in the sink!

Place work orders for toilets, sinks and showerheads! A running toilet can cost over $800/year!

Wash only FULL loads of laundry. Clothes washers account for almost 1/4th of total water use!

Turn off the tap when brushing your teeth or washing your hands

*

*Water Savings worksheet is in back of the handbook on pg. 107

Average Indoor Water Use

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Reduce Expenses:

Indoor Air

Clean with Homemade Cleaning Supplies

Studies have shown that many of the commonly used chemicals in cleaning products are linked to asthma, respiratory diseases, birth defects, and cancer. You can keep your home just as clean for much less money, safeguard your personal health, and even protect the environment by going back to the basics. Get started with vinegar and baking soda by using the green cleaning recipes and suggestions in the resources section of this packet!

Stop Using Air Fresheners

Home fragrance products often contain volatile organic compounds (VOCs) that include nasty chemicals like formaldehyde and petroleum distillates. VOCs can trigger eye and respiratory tract irritation, headaches and dizziness. A clean home should smell like nothing at all!

Open your windows or run exhaust fans for fresh air. This dilutes indoor levels of pollutants!

*

*Healthy Indoor Air Savings worksheet is in the back of the handbook on pg. 108

Don’t be tricked by “Greenwashing!”

Similar risks for most conventional air

freshening sprays, candles, & plug-ins

When tested in a lab, Comet emitted 146 different chemicals.

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Reduce Expenses:

Recycling

Use Reusable Everything!

Buy reusable over disposable items. Look for items that can be reused; the little things can add up. For example, you can bring your own silverware and cup to work, rather than using disposable items.

Recycle

Recycling is the process of collecting and processing materials that would otherwise be thrown away as trash and turning them into new products. Recycling can benefit your community and the environment.

Buy foods in bulk to save an average of 89% on food shopping costs.

Buy used products. You can find anything from clothes to kitchen goods to building materials.

*

*Recycling Savings worksheet is in the back of the handbook on pg. 109

$0.00

$10.00

$20.00

$30.00

$40.00

$50.00

$60.00

$70.00

FoodShopping

Bags

WaterBottle

FoodStorage

KitchenNapkins

Utensils& Plates

Average Purchasing Costs [Reusable vs. Disposable]

Reusable Disposable

44

Reduce Expenses: Saving Green

How to Clean with Vinegar and Baking Soda

Vinegar Baking Soda

General Cleaning

Glass – Remove ugly film in narrow-necked glass jars, flower vases, and bottles by letting undiluted white distilled vinegar sit in them for a few hours. Add a little rice or sand and shake vigorously to loosen stubborn stains. Repeat if necessary.

Silver – Clean silver using 3 parts baking soda to 1 part water.

Tarnished Metal – Make a paste with equal amounts of vinegar and table salt.

Carpet – Freshen carpet by sprinkling with baking soda, waiting 15 minutes, and then vacuuming.

Sponges – Cover with water in a bowl. Then add 1/4 cup vinegar. Let soak overnight.

Grease Stains – Pre-treat grease stains with a baking soda paste before washing.

Wood – Remove water rings with a solution of equal parts vinegar and vegetable oil. Rub with the grain.

Laundry Booster – Add a 1/2 cup of baking soda to your load of whites before washing.

Scissors – clean off sticky residue with a cloth dipped in vinegar.

Scrubbing Walls – Sprinkle your sponge with baking soda when cleaning walls. It even removes crayon!

Hands – Wipe your hands with vinegar to remove strong scents like onion and garlic

Fabric Softening – Add 1/2 cup of baking soda to the rinse cycle to act as a natural fabric softener.

Dusting – Use spray bottle filled with half vinegar, half water and lightly spray a rag to dust all surfaces.

Pest Control – Baking soda will repel ants and cockroaches where ever you sprinkle it.

Mildew – Spray shower walls and shower curtain with half vinegar and half water to help prevent mildew.

Absorb Moisture – Place a bowl of baking soda anywhere there is a moisture problem. The baking soda will absorb the moisture in the air.

Odors – Place a bowl of vinegar in the room overnight.

Clean Floors – Mop floors with a solution of 1/2 cup baking soda dissolved in a bucket of warm water.

All-purpose Vinegar Spray Cleaner: (32 oz. bottle)

¼ cup white vinegar

4 cups warm water

6-10 drops essential oil (optional) In a large spray bottle, combine vinegar and water. Add drops of essential oil (peppermint, lemon, tea tree). Shake before each use.

Baking Soda Scrub:

1/2 cup baking soda

Water Pour 1/2 cup of baking soda into a bowl, and add enough water to make a texture like frosting. Scoop the mixture onto a sponge, and wash the surface. This is the perfect recipe for cleaning the bathtub because it rinses easily and doesn’t leave grit.

45

Vinegar Baking Soda

Kitchen

Counter Tops – Clean with a rag and vinegar.

Produce – Dust produce with baking soda before washing to get it extra clean.

Microwave – Mixing equal parts vinegar and water in a microwave-safe bowl. Bring it to a boil inside the microwave. Wipe clean.

Dirty Pots – Sprinkle baking soda on the bottom of pots burnt with food. Fill with hot water and soak overnight. Scrub to clean.

Refrigerator – Clean with a solution of one-part water and one-part vinegar.

Plastic Food Containers – Plastic food containers can be cleaned by wiping down with baking soda. Soak stubborn stains with 4 parts baking soda and 1 part water.

Dishwasher – Pour a cup of vinegar inside an empty machine and run through a cycle.

Dishwasher – Sprinkle baking soda in the bottom of your dishwasher before your next load to get rid of odors.

Plastic Food Containers – Wipe with a cloth dampened with vinegar to remove stains and smells

Sponges – Soak sponges in 1 quart of water mixed with 4 tablespoons baking soda to keep them smelling fresh.

Cutting boards – Wipe wooden boards with vinegar.

Cutting Board – Sprinkle a cut lemon with some baking soda and rub on your wood cutting board to remove stains.

Grease – Use a sponge soaked in vinegar.

Garbage Disposal – Process baking soda and lemon wedges in your garbage disposal to keep it smelling fresh.

Metal Sinks – Stainless steel sinks will shine after you clean with a mixture of baking soda and vinegar.

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Vinegar Baking Soda

Bathroom

Grout – Let full-strength vinegar sit on it for a few minutes and scrub it with an old toothbrush.

Deodorize – Place an opened box in the refrigerator, freezer, cabinet, closets, or anywhere you want to remove odors.

Germs – Spray with full-strength vinegar. Wipe clean with a damp cloth.

Toilet – Stubborn toilet stains can be cleaned by sprinkling toilet with 1 cup of baking soda and allowing to sit for 30 minutes. Spray with vinegar then scrub.

Mildew & Soap Scum – Wipe with vinegar then rinse.

Shower Doors – Remove water spots from shower doors by wiping down with baking soda sprinkled on a damp sponge.

Toilets – Pour in a cup or more of vinegar and let it sit several hours or overnight. Scrub well and flush. Grout – Use a baking soda scrub to

clean stubborn grout stains. Stale Odors – Wipe down with vinegar on a rag or place a bowl of vinegar in the room overnight.

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48

49

Money Management

Section II:

Freedom from Debt &

Giving Yourself

Credit

50

51

Create Your Own Budget

Remember Josephine and Mark’s budget from last week’s class? Now it’s your turn to make your own. Look back at your week of tracked expenses and create a budget for this month.

For more budget templates, please go to: http:/www.foundcom.org, click on the Financial Stability tab, and choose One-on-One Financial Coaching, then go to Additional Resources and click on “Build Your Budget.”

Commented [TW23]: Objective: Have students complete this budget in class. Time: 15 minutes Critical Knowledge: Have students look back to Josephine and Mark’s budget from last week. Now they will need to create a budget for themselves for this upcoming month. If they tracked expenses last week they should use it to complete the budget.

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Activity: Excuses for Spending Money We Don’t Have

Be aware of your emotional state or tendency to open up the wallet whenever you go

somewhere that you can buy something. It’s much easier to make excuses when you’re

staring at a shiny new gadget. Decide what you’re going to do prior to leaving the house.

Below are some examples of excuses that you may have used in the past. Fill in the blank spaces with the excuses listed below or create your own!

Fancy dinner out New shirt Vacation New TV New phone

New shoes Toy for your kid New mattress New laptop New car

“I’ve been frugal this week, so I deserve ________________!”

“I won’t buy _________________, so I’ll buy this __________________.”

“__________________ was on sale!”

“Well, you bought ___________, so I bought a ___________.” – Usually directed at a spouse

“The _____________________ will last several years, so it’s a good investment”

“We need a ___________________” – we should all clarify the definition of need.

“We made more money this month, so I can afford to __________________.”

“We deserve a ____________________, we don’t buy much for ourselves these days”

The Blank Spaces

The blank spaces can be filled with anything from a new technology gadget, a new shirt for

your kid, a new appliance, a home renovation project, new tools, a new car, a new house, or

a fancy dinner out.

Manage Your Excuses

I challenge you to examine the motivation behind such excuses. Are you attempting to justify

your spending behavior? If you have any debt, you had better be able to justify why you

should be allocating precious money towards ____________ rather than paying down your

debt. If you’re out of debt, why are you allocating money toward ___________ instead of

retirement, a future down payment, your kid’s college education, etc.?

Commented [TW24]: Objective: Display how rationalization of bad decisions leads to poor spending habits. Time: 10 minutes Critical Knowledge: This activity lends itself to a great class discussion. It’s easy to make it excuses to yourself, but it’s hard to believe them!

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Types of Debt

By: www.investopedia.com Debt is simply an amount of money borrowed by one party from another. Mortgage and Student Loans: Having no debt is always the best option. Debt for many people today is simply a fact of life, but some types of debt tend to be worse than others. Debt that is incurred to purchase something that increases in value, such as a home or a college education is generally considered to be better than other types of debt. The interest on student loan debt and mortgages is also deductible for most borrowers, which gives them another advantage. But there are no guarantees, while good debt may seem like a great idea; it is important to realize that even the best ideas don’t always work out as intended. Other Types: Other types of debt such as credit card debt, car, and personal loans usually charge much higher rates of interest which is not deductible under any circumstances. This type of debt is usually considered to be the least advantageous for consumers. How Much Debt is Too Much? Although the maximum amount of debt that you should carry will depend to some extent upon your current financial situation, a general rule of thumb is that your total monthly debt payments (not including your mortgage) probably should not exceed 15% to 20% of your take-home income. This includes credit cards, student loans, car payments and other installment debt.

Commented [TW25]: Objective: Define good and bad debt, differentiating between the two. Critical knowledge: Debt is unavoidable, but if we’re careful about which types of debt we incur, we can make it less painful. Some debts can be considered an investment.

55

Payday Loan and Car Title Loan Education

http://www.texasfairlending.org/

Payday and auto title loans help in the short-term, but create a long-term debt trap. Payday loans are secured by access to a borrower’s bank account via a post-dated check or electronic ACH authorization. The initial term is typically two weeks to one month, with the term usually determined based on the borrower’s pay cycle. Auto title loans are secured by a car title; the amount loaned is based on the value of the car and they have terms of thirty days. They are both marketed on the basis of speed and convenience to people who may feel they have no other options.

The Cycle of Debt

The high cost and structure of a payday loan

and auto title loans trap borrowers in a cycle of

debt where they continually pay fees and

interest—never paying down the loan. In spite

of the short initial term of the loan, borrowers

can be stuck paying for months on end paying

fees every two-weeks to one-month averaging

23% of the loan principal. At such high rates,

it does not take long for the fees to add up to a

damaging cycle of debt.

Julia, who works in an elementary school

cafeteria, got a $500 fast cash payday

advance, because she was short on money for

rent—she left the store with $500 in her pocket

and a loan for $615 (the first $115 fee is rolled

into the loan principal amount). At the end of

two-weeks, she went back to the loan

store. She didn’t have the full $615 she owed, so she paid $115 fee to rollover the loan for

two more weeks. Because money is tight, many working Texans, just like Julia rollover over

their loans 5 or more times, and end up paying $1200 or more for what started as a short-

term $500 loan.

Commented [TW26]: Objective: To make students aware of the cycle that payday loans and auto tittle loans can create for an individual. Critical Knowledge: Help students see how an emergency savings can prevent them from using a payday loan as a resource. This is also a great time to highlight FC’s Fresh Start Loan program for anyone who has a payday loan or auto title loan.

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Payday Loan and Car Title Continued

Under current Texas law, there is no limit to the fees that payday lenders and auto title

businesses can charge and no limit on the number of times they can charge high-fees for

essentially the same loan. Auto title loans are similar to payday loans, but the amount

loaned is generally higher and a borrower who fails to make a payment could lose his means

to get to work and take his kids to school.

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A Lifetime of Debt: What Happens When You Pay Only

the Required Monthly Minimum?

Paying more than the minimum balance on a credit card each month will reduce (1) the amount of money you will have to pay and (2) the amount of time it will take to pay off the card. If you pay only the minimum amount, you will wind up spending far more money than is necessary, simply because you will be socked with finance charges that you could have avoided by making larger payments.

Below is an example of the calculation provided on your credit card statement:

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Dealing with Debt Using the Power Pay Method

Available online at https://powerpay.org

By using the Power Pay* method of debt repayment, you will maximize the effect of your monthly payments on your debt. This method is easily incorporated into your budget and can

help eliminate debt more quickly than other methods. Follow these steps:

1. Make a commitment to stop borrowing or charging until all debts are paid. 2. Prioritize debts in this order:

• First priority is the debt you can pay off the fastest – there’s a psychological boost that will help you keep going, and you can free up some extra cash quickly to apply to other debts.

• Next, to maximize savings, the rest of your accounts should be put in order of interest rate (highest to lowest).

• Finally, collection accounts should be addressed after all current debt is paid – they are likely to have stopped accruing interest.

3. Dedicate a set amount of money to monthly debt repayment. This amount can be just the sum of all minimum payments. If you can dedicate more toward debt repayment, the extra amount should go to the first priority debt.

4. Pay the same amount to each bill every month, even if the minimum payment drops.

5. When debt #1 is paid, the money that was being paid to that debt is now added to the money being paid to debt #2.

Based on your budget, how much can you spend on debt repayment monthly?

Debt Amount Owed

Interest Rate

Minimum Payment

Amount you can pay monthly

1.

2.

3.

4.

5.

6.

Totals

* Power Pay is a program developed by the Utah State University Extension.

Commented [TW27]: Objective: Show students how making a commitment to pay down debt each month can save them time and money. Critical Knowledge: Can be shown in real time on a projector. Must inform class coordinator beforehand. Paying a set amount each month makes it easy to budget!

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Other Options for Dealing with Debt

(For accounts other than student loans, tax liens and child support debts) There are four options for consolidating your debts, having one monthly debt bill instead of many. However, consolidation is not right for everyone. Most people can get out of debt by making a plan and sticking to it. Ultimately, debt consolidation should not be used as a quick fix, but rather a tool for managing debt responsibly. “70 percent of Americans who take out a home equity loan or other type of loan to pay off credit cards end up with the same (if not higher) debt load within two years,” says Chris Viale, general manager of Cambridge Credit Corp., a nonprofit credit counseling agency based in Agawam, Mass.

Bank Loan

For many consolidation-loan candidates, their current debt problems mean they don’t have a great credit score and won't get the lowest-available interest rate

When there is nothing to secure the loan (such as your home), the interest rate is likely to be higher

Bank loans will help establish credit

Credit Card Balance

Transfers

This can be a good option if the following terms apply:

It has a big enough limit to cover your debt

The interest is lower than all your other credit cards

The transfer fee is low enough to make it worthwhile

You don’t already have a balance at a higher interest rate.

Debt Management

Program

Be careful who you choose to manage your debt—you are putting your name and financial well-being in their hands.

Nothing is actually consolidated in this case, but the consolidation company negotiates the terms of your accounts, and then takes over the management of your payments so that you are paying just one bill.

There is a fee that is based on a percentage of your debt, so you should make sure that you are actually saving money by enlisting the service.

If you decide to opt for a debt management program, you should know that it will be noted on your credit report. However, it does not change your rating.

Inquire about community resources through Foundation Communities.

Bankruptcy (Worst Case Scenario)

Most people can work their way out of financial trouble without filing bankruptcy by getting on a budget, cutting their expenses, enlisting the help of a credit counselor or financial advisor, and/or negotiating with lenders.

Filing bankruptcy stays on your credit report for 10 years.

Commented [TW28]: Objective: Show students their options for debt repayment. Critical Knowledge: While there are plenty of ways to pay down debt, some will be more costly and have longer consequences than others.

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Bankruptcy (Worst Case Scenario) Continued

If you file for bankruptcy, your debt may be forgiven, but you will have to pay attorney and court fees to do so. Your best bet is to see a credit counselor first.

If it won’t eliminate at least 50 percent of your debt, it is not worth it.

There are two kinds of bankruptcy:

Chapter 7: Straight Bankruptcy, where your consumer debts are discharged.*

Chapter 13: You establish a payment plan through the court. After 36 to 60 months, the remainder of your debts may be discharged.*

The reality is that bankruptcy is a very complicated. You can find more information about bankruptcy on the Federal US Courts’ web site: www.uscourts.gov/bankruptcycourts/bankruptcybasics.html

Inquire about community resources through Foundation Communities.

* Bankruptcy will not eliminate student loans, child support, back taxes or any government debt.

Financial Coaching and

Credit Counseling

Financial Coaching provides a structured environment in which you will receive the tools and support needed to take control of your finances. A financial coach will work with you to address your financial goals and concerns and can help you with fixing credit, reducing debt, saving for the future, budgeting and organizing your financial life.

Similar to financial coaching, credit counseling focuses more on issues surrounding credit and can help you better understand the state of your credit and identify ways you can repair or establish credit. Credit counseling also covers topics like budgeting, debt/money management, etc.

Foundation Communities offers free financial coaching and credit counseling to individuals and families earning less than $50,000 a year. Trained volunteers are available to meet with clients Monday through Saturday at our North and South locations. Visit http://foundcom.org/financial-stability/financial-coaching/ for details.

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Top 5 Reasons Why People Go Bankrupt:

By Mark P. Cussen http://financialedge.investopedia.com

The bankruptcy statistics in America are alarming. The past few decades have seen a dramatic rise in the number of people who are unable to pay off their debts, and Congress has addressed the issue with legislation that makes it harder to qualify for this status. There are many reasons why taxpayers are forced-or choose-to declare bankruptcy. But many times, common sense, sound financial planning and preparation for the future can head off this problem before it becomes inevitable. Those who are contemplating this possibility should seek a credit counselor or financial planner before choosing this alternative. Following is a list of the most common causes of bankruptcy in America today.

1. Medical Expenses 62% of all personal bankruptcies.

2. Job Loss Remember your emergency fund!

3. Poor/Excess Use of Credit

4. Divorce/Separation

5. Unexpected Expenses Remember your emergency fund!

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Credit 101: Why is Having Good Credit Important?

By: Consumer Action

What is Credit?

Credit is borrowed money that you can use to purchase goods & services. You get credit from a grantor, whom you agree to pay back the amount you spent, plus applicable fees, at an agreed-upon time. Your credit report is considered a representation of your trustworthiness.

A creditor has to trust that you are going to pay your debts and your credit report is the only thing creditors have to base their decision on (regarding whether to extend you credit or the amount of interest to charge). People with good credit have:

Established credit – they have borrowed money or used a credit card

A proven record of making at least the minimum payments on time – by the due date – and staying within their credit limits

Only obtained loans or credit cards that they are capable of paying back. (Don’t overextend yourself – apply for only the credit you can afford).

Good credit can help you:

Buy a home

Get a job

Set up telephone, gas and electric, water or heating oil accounts

Rent an apartment

Buy ‘big ticket’ items (furniture, electronics, or appliances) without paying cash

Finance a car

Qualify for insurance coverage

Borrow money

Obtain another credit card

Commented [TW29]: Objective: Give students an overview of credit, focusing first on the benefits of maintaining good credit history.

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Do’s and Don’ts for Building Credit

By Bankrate.com

So, how does one go about establishing credit? Here's what Steve Bucci, the president of Consumer Credit Counseling Services of Southern New England suggests.

DO

• Apply for a credit card. Apply only for those cards whose requirements you are likely to meet.

• Consider a secured credit card. If you have trouble qualifying for a credit card, you may opt to apply for a secured card. These cards have credit limits based on a required deposit made by you into a savings account.

• Apply for a Credit Builder Loan (for example: RBFCU). Always make sure the creditor reports account activity to the credit bureaus. As the purpose of obtaining the card is to establish credit.

• Get a co-signer. Having a trust-worthy person co-sign may increase your chances of getting a loan or lower your interest rates. Co-signing on a loan or credit card is a serious matter that should not be entered into lightly. Essentially, a co-signer is taking on legal responsibility for the account

• Get credit for the rent you pay. Rent-reporting services such as Rental Kharma and RentTrack take a bill you are already paying and put it on your credit report, helping to build a positive history of on-time payments.

• If denied credit, ask why. It is important to find out why you are denied because frequent inquiries (applying for credit) on your credit report can be viewed as a negative to a potential creditor. By law, if a company denies your application for credit, you have the right to the name and address of the credit reporting company they contacted. Under federal law, you’re also entitled to a free report if a company denies your application for credit. Ask for your report within 60 days of receiving notice of the action (http://www.ftc.gov/bcp/edu/pubs/consumer/credit/cre01.shtm).

• Create a spending plan. Remember a $5,000 credit limit is not $5,000 in additional income. It is only a different way to spend the money you already have. Before you use your credit card, you will want to make sure that you are able to pay off the balance on the items you plan to purchase.

• Charge small purchases you can afford and make payments on time. Pay the entire balance each month, and avoid paying interest by taking advantage of the grace period, or length of time given to pay something back without fees or penalties being implemented.

DON'T

• Don’t make late payments or stop paying any creditor.

• Don’t max out your credit cards.

• Don't let anyone else borrow your credit card, debit card or in any way have access to your bank account. You are responsible for any authorized use of your accounts.

• Don't fall for gimmicks and don't take the first card offered – read all the fine print.

• Don't get more cards to pay off debts.

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Credit Basics

When shopping for a credit card:

Comparing cards before you apply for one is vital.

Avoid high APR’s & annual fees.

Make sure you understand your cards interest rates.

Be aware that creditors have the right to change any of the terms so check your mail vigilantly for adjustment notices.

Understand that the contract is binding. Tips for credit cards:

Pay on time & if you can’t make payment arrangements A.S.A.P.

Always try to pay more than the minimum payment.

Can I get a credit card with bad or no credit?

Yes, a good option for this is a secured credit card.

Resources for finding your next card:

Creditcards.com A website (based out of Austin, TX) that allows you to compare credit cards depending on your needs.

Bankrate.com A website that provides a variety of financial tools. Some of its resources includes comparing credit cards depending on your needs as well as a calculator to help you estimate your FICO score.

Your credit can be negatively affected by:

Late payments

Paying less than the minimum

Having too many credit cards with large amounts or large amounts of available credit – even if you make on-time payments

Overdue accounts referred to a collection agency

Declared bankruptcy

Having court-ordered withdrawals from your paycheck to pay debts (garnishment).

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Credit Cards: Buyers Beware

By Bankrate.com

Credit cards are an easy way to get in financial trouble. When used wisely, credit can help

you purchase things if you have established goals. It may seem very difficult to get by without

credit cards in this day and age, but the fact of the matter is it's becoming more and more

expensive to live with them.

Bait-and-switch card offers. Direct mail offers generally advertise the issuer's premium

card at an eye-popping low interest rate, while the fine print says the company can issue a

more costly non-premium card with a higher annual percentage rate if you fail to qualify for

the premium card. Just because you apply for a card with a low rate doesn't mean the card

that shows up in the mail actually carries that low rate.

Late payment fees. A recent study by Vertis, a marketing company that researches

consumer credit usage and payment habits, found that 2% of all credit card holders

occasionally miss getting their credit card payment in on time. They pay dearly. The national

average is $29. MBNA (one of the largest issuers of credit cards), Bank of America and

Providian are among the steepest chargers. Their late-paying customers get charged $39,

according to Consumer Action.

Over-limit fees. Exceed your credit limit by even one cent and you'll be hit with over-limit

fees of $25 to $39. Cruelly, a $39 late fee can then trigger a $39 over-limit fee.

Balance transfer fees. It's the big tease: A rock-bottom introductory rate to transfer your

balance, but that tantalizing low rate may come with a steep transaction fee, 3% to 5%, for

transferring your balance to their card, which means transferring $1,000 at 4% will cost you

$40. "It's really very tricky," says California attorney Howard Strong, author of "Credit Card

Secrets." He adds, "They have all these sneaky fees. You need to be extremely cautious."

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Important Credit Card Terms & Conditions

Credit Line or Limit The total amount you may charge, including interest & fees.

Interest Calculation Method

Most calculate interest charges by averaging the daily account balance, then multiplying that figure by the periodic rate (APR divided by the number of days in a year).

Annual Percentage Rate (APR) Fee in the form of a percentage for not paying the entire balance in full. The average for a new credit card offer is around 14%.

Fixed Interest Rate The interest rate or APR will remain the same unless you receive a 45 day notice that is required by law.

Variable Interest Rate The interest rate or APR changes according to a formula set by the credit card company.

Minimum Payment The lowest amount that you are required to pay. If you do not pay this amount, the credit card company can charge a late fee plus interest.

Grace Period The number of days (generally between 20 & 30) you have to pay in full before interest accrues

Fees

Ordinary fees include those for cash advances, balance transfers, paying late, exceeding your credit limit, & sometimes an annual fee. Avoid cards with nonstandard fees.

Annual or Monthly Fee The credit card charges you a fee once per year or once per month for using the credit card.

Payment Due Date The date that the minimum payment is due & considered on time.

Cash Advances You can immediately receive cash from an ATM but watch out for the cash advance fees & interest rate that will be charged.

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Credit Repair Services: Do they really work?

By Consumer Action www.consumer-action.org

Companies claiming they can repair your credit advertise on TV, in newspapers, with flyers,

and on the Internet. These companies guarantee to fix credit for a fee. Be sure to research

any company you are considering doing business with. Credit repair companies are allowed

to operate as long as they follow federal and selected state laws designed to protect you

from common deceptions. A company offering to repair your credit cannot perform any

services until it has your signature on a written contract, which you have three days to cancel

without penalties and fees. All contracts must describe the services to be performed and

provide detailed disclosures on cost, payment terms, how long it will take and how to contact

the company. Some credit repair companies offer you a new credit identity or taxpayer ID

number. This is illegal. Credit repair companies cannot ask you to pay any money until they

have completed any promised services.

Commented [TW30]: Objective: Most credit repair service companies are doing exactly what the consumer can do, but for a fee. Make sure students are aware that these repair services do not have any extra power when it comes to changing their history. Critical Knowledge: This is a great moment to highlight that FC has free credit counseling services.

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Do-it-Yourself Credit Repair

An alternative to hiring someone to repair your credit is doing it yourself! Below is a list of resources that can help you get started on fixing your credit report.

Check Your Credit Report Once a year, you can request a free credit report from the Annual Credit Report Request Service. Online: www.annualcreditreport.com by phone: 1-877-322-8228. The free credit report you get from this central source does not include your credit score.

Make a plan to catch up on overdue bills, and schedule future payments Making on-time payments and keeping balances low make up 65% of your credit score. This is the best way to improve your credit score Pay down debt Decide the best way to pay down current debt. PowerPay.org is a good resource for figuring out how to best organize your debt repayment. Dispute Inaccuracies with the Credit Reporting Bureaus Contact the three Credit Reporting Bureaus directly to dispute inaccurate information. Use the contact information for Equifax, Experian and TransUnion included on your credit report. Use the attached sample dispute letter as a guide. The most effective way to dispute information is in writing. Include your full name, SSN, current address and phone number, date of birth and signature. If one of the credit bureaus listed above does not respond to your requests, you can file a complaint with the Federal Trade Commission (www.ftc.gov). Dispute Inaccuracies with the Creditors You can contact the company that reported the inaccurate information directly. Gather any documentation you may have to support your case before contacting them. Start a positive payment history: When late payments have been made in the past, the client has the opportunity to re-establish credit by creating a positive payment history on a new account.

Let the clock tick: The older an account is on a credit report, the weaker its effect is on the score. Negative accounts will become less powerful over time. Meet with a credit counselor: Foundation Communities, as well as other organizations, offer free credit counseling with trained volunteers who can help you better understand the state of your credit and identify ways you can repair or establish credit. Credit counseling also covers topics like budgeting, debt/money management, etc.

Commented [TW31]: Objective: Show students where to start when considering self-repair. Critical knowledge: Get absolutely everything in writing. Don’t be afraid to visit a Credit Counselor.

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Negotiating With Creditors

Many of us have never considered negotiating with our creditors. However, as intimidating as it may sound, the process can save you money and keep you in good standing with your

creditors. What you can negotiate:

1. A lower interest rate on your credit card (contact: Credit Card Company). Note: If you negotiate with your credit card companies, keep in mind that they will check your credit score and ask about your income. If either of those is lower than it was when you got your current interest rate and credit limit, the credit card company may actually increase your interest rate and/or decrease your limit.

2. The elimination of the annual fee charged to your credit card (contact: Credit Card

Company).

3. Lower monthly payments (contact: Credit Card Company).

a. Keep in mind that the less you pay monthly, the more you will pay in interest over time. Only negotiate for lower payments if you absolutely cannot pay the minimum.

4. A payment plan for a past due amount (contact: Credit Card Company, Utility

Company, Phone Company, etc.)

5. The acceptance of a reduced amount for payment in full of a debt (contact: Collection Agency)

When negotiating with a creditor (not a collection agency), always remember:

1. Be proactive – If you know you’re going to have a problem paying your bill, call as

soon as possible. Try to make arrangements at the first sign of trouble to avoid being late or missing a payment.

2. Be prepared – know what you can (and can’t) commit to. Make a list of all your

financial commitments to help determine what you negotiate.

3. Don’t hesitate to ask to talk to a supervisor or call back another time if the person on the phone says they can’t help you.

4. Document everything: write down the date and time, get the employees name or

employee number and make notes of exactly what was said and what arrangements were made.

5. Get arrangements in writing from creditor.

Stick to your agreements– most creditors do not believe in negotiating a second time.

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Know Your Rights

Credit Card Accountability

Responsibility and Disclosure Act of

2009

This act is comprehensive credit card reform legislation that aims "...to establish fair and transparent practices relating to the extension of credit under an open end consumer credit plan, and for other purposes.

Due dates for monthly payments must be the same day each month.

Creditors must provide written notice 45 days prior to a rate increase or other significant changes (examples: increase in any fee or finance charge).

The law places strict limitations on marketing and issuing credit cards to young people.

https://www.consumer.ftc.gov/articles/pdf-0096-fair-credit-reporting-act.pdf

The Fair Credit Reporting Act

(FCRA)

This act is designed to make sure that accurate and complete information is reported when evaluating one’s credit. The act is also designed to protect the privacy of your information. https://www.consumer.ftc.gov/articles/pdf-0096-fair-credit-reporting-act.pdf

The Fair and Accurate Credit

Transactions Act (FACT Act)

This act is designed to help ensure that all Americans, of every income level and background, are able to build good credit, avoid identity theft and confront the problem if they are a victim of identity theft. It also gave every consumer the right to their credit report free of charge every year. Consumers can visit www.annualcreditreport.com to do this. http://www.consumer.ftc.gov/sites/default/files/articles/pdf/pdf-0111-fair-credit-reporting-act.pdf

Commented [TW32]: Objective: Show students the big-name regulations and highlight some important rights. Critical knowledge: If something feels unfair, it very well might be. Research your rights or visit a Credit Counselor if you suspect something is amiss.

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Marriage and Credit

By Experian.com

Managing your credit can be tricky, even when you’re the only person involved in your financial decisions. When you add a new spouse to the mix, you have to be extra careful to ensure that your credit remains in good standing.

Discuss Your Financial Status

First of all, both you and your spouse should put all your financial records – savings, salaries, investments, real estate and especially credit – on the table. If one of you has a less-than-glowing credit history, it will affect the other as soon as you start applying for credit together and opening joint accounts. Reviewing your credit reports together help prevents any unpleasant surprises in the future. In addition, your new joint accounts will appear on both of your credit reports in the future, so be sure to pay careful attention to your bills and pay them on time. The key to successful credit management as a couple is understanding that your individual credit behavior affects both you and your partner. To ensure that you are able to quickly get credit at the best possible terms, be sure you both understand all the implications that accompany a joint account. In addition, consider how the payments stemming from a major credit purchase will affect your overall budget.

If you have any questions you should make an appointment to meet with a financial coach at Foundation Communities.

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73

Money Management

Section III:

Protecting Your

Identity & Reading

Your Credit Report

74

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12 Steps to Protect Your Identity

Personal information that could be used to commit identity theft may include: your social

security number, birth date, driver’s license number, mother’s maiden name, bank account and credit card numbers.

Prevention:

1. Make a list of everything in your wallet, including credit card numbers and contact information in case anything happens to it. If anything were to happen to it, you would know all of its contents and have important credit card and phone numbers at your disposal. Make sure to keep the list in a safe place.

2. Order a copy of your credit report from each bureau once per year to check for inaccuracies and fraudulent use of your accounts.

3. Never give out any personal information over the phone unless YOU initiate the call.

4. Be wary of unauthorized charges on bank and credit card statements. Signup for

alerts and check bank statements.

5. Memorize passwords. Do not record them in your wallet or purse. Substitute numbers for some words or letters in your passwords. For example ‘I want to see the ocean’ could be 1w2stO.

6. Shield your PIN when using an ATM; many thieves spy on their victims with binoculars or video cameras.

7. A “lock” icon on the status bar of your internet browser means your information will be

safe when it’s transmitted. Look for the lock before you send personal or financial information online.

8. Don’t over share on social network sites. Avoid sharing personal information, such as address, phone number, date of birth and full name on publicly accessible sites.

9. Stop your paper bank statements and switch to email statements (if you have online banking).

10. Put a lock-password on your computer and phone.

11. Take the Social Security Card out of your wallet.

12. Sign the back or put “SEE ID” on the back of your Credit or Debit Card. If your wallet is lost or stolen:

1. Cancel credit cards, notify your bank. 2. Immediately file a police report in the jurisdiction where the wallet was stolen 3. Call the three national credit reporting organizations to place a fraud alert on your

name and SS#.

Commented [TW33]: Objective: Show students simple tasks they can do to help protect their identity. Critical Knowledge: Identify theft is more common now than ever before. It’s important for students to be aware

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Top Internet Scams

https://texasattorneygeneral.gov/cpd/top-ten-frauds-and-scams

1. Easy Credit. Online or in the classifieds, these ads all promise that you can get a loan no matter how bad your credit rating. The catch? You have to pay a fee up front. Advance fee loans are illegal. Don't send the money! This is not credit repair, it's credit disaster. 2. Phishing. No matter what they say, when they call or email wanting you to give them your social security, credit card, or bank account number, DON'T DO IT. Not for any reason, no matter who they say they are or why they say they need it. They will steal your identity (and your money). 3. Nigerian Fraud. A fleeing deposed government minister (or his widow) wants to deposit the treasury of a foreign country in your bank account. Anytime you have to send money to collect a huge windfall, you should STOP in your tracks. The dream of a huge sum of money is very alluring, but the immediate reality is that someone wants to TAKE your money. And they are planning to keep it. This is a rip-off. Do not respond. 4. Counterfeit Cashier's Checks. It looks like the real thing: a cashier's check drawn on a familiar bank is as good as gold, right? Wrong. The counterfeits in circulation today are very high quality forgeries. They might even fool your bank at first. You don't need to be in the business of cashing people's cashier's checks. Especially not the counterfeit kind. A Dangerous Fraud Counterfeit cashier's checks are particularly damaging for several reasons. First, they are disarming, because it appears the scammer has actually produced the money, whereas with a scam, normally the victim is the one who writes the first check. Second, the counterfeits are so good that bank staff often accept them and may even reassure the victim that it is okay to write checks against the "deposit." Third, the victim who deposits a counterfeit check could actually be charged with a crime. This happens. Counterfeit cashier's checks can be used in combination with lottery scams, Nigerian fraud, government grants, and other scams where the victim is skeptical that there really is a pot of money to be gained. Always beware of large cashier's checks from strangers. 5. Bogus Debts. You may receive a threatening letter demanding payment on a debt you never heard of. Don't pay it. There are scammers who will demand payment on totally fictitious debts in the hopes that a few people will be scared into paying. Any legitimate creditor will be able to produce proof that a debt exists in the first place. Of course, if the debt turns out to be real and you weren't aware of it, you may be the victim of ID theft. 6. Government Grants. A scammer may contact you to say that you have been awarded, or can apply for, a government grant. The scammer may offer to help you get the grant. The grant could be for any purpose -- to help you start a business, go to school, repair your home or whatever. The catch is that you have to pay a fee of some sort. Government grants are not awarded to people who have not applied for them, no one can appply for you, and there is never a fee. 7. Foreign Lotteries. You did not win the foreign lottery! Anytime you are asked to send money in order to collect your winnings in a lottery or sweepstakes, STOP. It is a scam called

Commented [TW34]: Objective: Educate the students about the top internet scams. Critical Knowledge: With more information getting shared on the internet, it’s easy to fall victim of a scam.

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advance fee fraud. You do not have to pay an up-front fee to receive real lottery or sweepstakes winnings. Don't be persuaded or bullied by a smooth operator on the phone. 8. Home Repair. Beware of unsolicited door-to-door home improvement offers. If it is a one-time offer, available only today, or a special deal on materials leftover from another job, be doubly cautious. If your home needs repairs, your best bet is to call more than one reputable roofing or driveway or other home repair company in your area and check their references. 9. Business Opportunities. Jobs or business opportunities that require you to pay up front for training, equipment, or "kits"; are highly suspect, especially if you found the offer on the Internet and have no independent information about the company involved. Legitimate employers hardly ever require new hires to pay to start the job. A tip-off: if the job is easy to get, pays extremely well, and requires very little work (in the comfort of your home, no less), be suspicious. It's too good to be true. 10. Shopping Sprees. Telephone solicitations offer a $500 (or similar amount) "Shopping Spree," supposedly sponsored by a known company or even governmental agency. The caller tries to get the consumer's bank account number to collect a small fee, supposedly for the shipping and handling of vouchers. Never disclose financial information for any reason whatsoever to callers making unsolicited offers. Shopping spree promotions usually are total fabrications. The Bottom Line—If it sounds too good to be true, it probably is.

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10 Tips to Help You Avoid Financial Scams

Investopedia.com by Amy Bell

1. Never wire money to a stranger.

If you don’t know them, don’t send them money. 2. Don’t give out financial information. 3. Never click on hyperlinks in emails. 4. Use tough-to-crack passwords. 5. Never give out your Social Security number. 6. Install antivirus and spyware protection. 7. Don’t shop with unfamiliar online retailers. 8. Don’t download software from pop-up windows. 9. Make sure the websites you visit are safe. 10. Only donate to known charities.

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Players in the Credit Game

Consumer- Everyone that uses credit

Collection Agency- The company that buys past due accounts from creditors and collects

on them (they buy the account for less than 10% of the balance and then tries to collect the

full amount from the consumer)

Credit Bureau- The company that collects information about you from creditors, collection

agencies and courts to create a credit report and score. TransUnion, Experian and Equifax.

Creditor- The company that extends credit, such as a bank or credit card company

The Three Credit Bureaus Are:

1. _____________________________

2. _____________________________

3. _____________________________

Consumer

Collection Agency

Credit Bureau

Creditor

Commented [TW35]: Objective: Show students who is involved when it comes to their credit report.

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Consumer Reports

By Privacy Rights Clearinghouse (privacyrights.org)

What are specialty consumer reporting agencies?

Companies that compile reports on consumers for other than credit have been designated by Congress as “nationwide specialty consumer reporting agencies.” These agencies compile reports about much more than just your credit history. Here are a few examples of the types of reports that they compile:

• Medical conditions (for example, the Medical Information Bureau (MIB) report)

• Residential or tenant history and evictions (for example, RentBureau)

• Check writing history (for example, ChexSystems)

• Employment background checks (for example, LexisNexis Screening Solutions)

• Homeowner and auto insurance claims (for example, CLUE reports)

What information goes into a “specialty” report?

Specialty consumer reporting agencies operate much like the credit bureaus. The agencies collect information about you from a variety of sources, including:

• Public records of criminal or civil cases

• Your credit history

• Bankruptcy filings

• Companies with which you have an existing or prior business relationship, such as insurance companies or banks

• Your medical information

• Driving records

From this information, the specialty reporting agency compiles reports based on the requirements of targeted users such as insurance companies, employers, and landlords.

How do I know if there’s a specialty report on me?

Unfortunately, most consumers are in the dark about the very existence of specialty consumer reports. Usually people learn about specialty reports only after having been denied a job, insurance, or an apartment rental.

Commented [TW36]: Objective: Raise awareness that these reports exist. Critical Knowledge: If you think you fall into one of these categories, look into obtaining a report and resolving the issue.

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35% Payment History - Have you had any delinquent loan payments during the last 7 years? This tells the lender how reliable you are in meeting payment obligations. The most recent payment history has a greater impact than payment history from 6 or 7 years ago.

30% Outstanding Debt - What is the total amount you owe on all debts? How much of your credit lines/credit cards do you use in terms of your balance in relation to the amount of credit extended to you. Using too much of the credit line extended to you will lower your score.

15% Length of Credit History - When was your credit history established? This component shows how much of a credit history you have. A person who has only had credit for the last 6 months will have fewer points in this category than a person who has 7 years of credit history. The reason is that with only 6 months of credit history on file, it is difficult to accurately rate your relationship with your debt and your reliability in making your scheduled payments.

10% Recent Credit Applications - Have you been applying for more debt during the last 12 months? If you frequently apply for new credit then this will lower your score. The reason is that excessive credit applications within a short period of time may indicate that you are having financial difficulties. One thing to note is that if you are shopping around for the best rate on say a car or a mortgage, applying for credit from several sources shouldn’t have an effect on your score as long as the “shopping” is done within the same time frame.

10% Types of Credit Used - What kind of loans do you have (i.e. credit cards, closed-end secured loans, mortgage, student loans, etc.)? A variety of credit types will result in a better score then having for example only credit cards.

What's in a Credit Score?

Payment History 35%

Outstanding Debt 30%

Length of Credit History 15%

Recent Credit Applications

10%

Types of Credit Used

10%

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Credit Score Range

Adapted from the article written by Bev O’Shea, June 10th 2016 https://www.nerdwallet.com/blog/finance/credit-score-ranges-and-how-to-improve/

What is a good credit score?

Fair Isaac Corp. produces the most commonly used credit scoring algorithm in the United States. Most FICO scores range from 300 to 850, and the higher the score, the better. (Some versions of the FICO score, such as those for the auto and credit card industries, are on a 250 to 900 scale.)

Where your credit score falls is going to have a significant apply at any company for any type of account. While every company will look at this, individual companies will feel differently about these numbers. Their decisions are based on their past experiences, the economy, your score, credit history, and income. They use all of this information to decide how risky they feel you are as a customer and offer you rates from there. Even though there are all of these factors, you can use this credit score range to guide you as to where you would like to be, and what sorts of rates will be available to you.

Each lender sets its own standards for what constitutes a “good” FICO score. But, in general, FICO scores fall along the following lines:

300-629 Bad credit

630-689 Fair credit

690-719 Good credit

720 and up Excellent credit

The average FICO score was 695, according to the latest data, from April 2015. About 22% of scores fall below 600; 23.3% from 600 to 699; and 54.7% are 700 or above.

Commented [TW37]: Objective: Show students how their score directly correlates with their access to services. Critical Knowledge: It takes time to improve a credit score, but if you take steps to resolve the issues, it can heal. It’s important to highlight that a credit score is just a three digit number. Their credit history is what should be focused on which will usually highlight behavior changes that will need to be made in order to see an improvement.

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What’s in Your Credit Report?

Personal Information: Your name, address, Social Security Number, date of birth, and employment information are used to identify you. These factors are not used in credit scoring. Updates to this information come from information you supply to lenders. Public Record and Collection items: Bankruptcies Judgments Liens Credit Inquires: When you apply for a loan, you authorize your lender to ask for a copy of your credit report. This is how inquiries appear on your credit report. The inquiries section contains a list of everyone who accessed your credit report within the last two years. The report you see lists both “voluntary” inquiries, spurred by your own requests for credit, and “involuntary” inquiries, such as when lenders order your report. For example, to make you a pre-approved credit offers in the mail. Trade line information: These are your credit accounts. Lenders report on each account you have established with them. They report the type of account (bankcard, auto loan, mortgage, etc.), the date you opened the account, your credit limit or loan amount, the account balance and your payment history. *Identifying personal information has no impact on scores. How long does information stay on your credit report?

Bankruptcy = 10 years from the date of entry of the order for relief (discharge)

Judgments = 7 years from the date of entry

Tax Liens = 7 years from the date of payment

Collections and Charge offs = 7 years from the date of collection or charge off*

Any other accounts = 7 years from the date they’re closed

Inquiries = 2 years

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Reading the Credit Report

Commented [TW38]: Critical Knowledge: This information is specific to the credit report pulled by Foundation Communities

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Corrections to the Credit Report Sample Letter To Whom It May Concern: I received a copy of my credit report and am disputing some items that need to be corrected. I have highlighted and numbered these disputed items on the attached copy. The reasons why these items should be corrected are indicated below: Item # Reason for Correction 7. Chevron USA (EFX, XPN, TUC) This account is not mine. OR This account is paid in full. OR

The payment status is incorrect. I did not make a late payment. OR

This account is a duplicate of account #8. These items should be noted on my credit record as “in dispute” until they are resolved. I am also requesting the names, addresses and telephone numbers of individuals you contacted so that I may follow up. If it is determined through your investigation that the disputed items are inaccurate, please correct my file and send me notification that the information has been updated or deleted. I am requesting an updated copy of my credit report, which should be sent to the address listed below. Thank you. Sincerely, Bruce Smith Address City, State, Zip Social Security # Date of Birth [Date] Creditor Address City, State, Zip

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Accounts in Collections

Collection accounts are different from regular debts and should not be put into Power Pay. Dealing with collection accounts should be done if the client’s cash flow is under control and all current obligations are being met. Part 1: The Facts

Collection accounts have an extremely negative effect on credit scores

Paying off a collection account will not remove it from your credit report

When you pay off a collection account, the collection agency’s obligation under the Fair Credit Reporting Act is to report your account with a $0 balance until seven years from the date it was submitted to collections by the original creditor

Having a collection with a $0 balance is better than a collection account with a balance

Calling a collection agency or making a payment does not re-start the seven years that an account can be on your report

There are tax consequences to negotiating. Any debt or portion of a debt that is forgiven is considered taxable income in the eyes of the IRS. Creditors and collection agencies are likely to report forgiven debts to the IRS (and the debtor will receive a 1099-C). Creditors are required to report forgiven debts on their federal tax return. The Exceptions: Bankruptcy and part of Mortgage Forgiveness

If you have no way of paying or even negotiating your debt, and you want them to stop contacting you, you must write a letter to the debt collector telling them to do so. A phone call is not enough. The debt collector can contact you one more time to tell you they are going to stop contacting you or that they could or will take another action (such as a lawsuit).

Part 2: The Tips Here are some tips for dealing with collection accounts. Dealing with collection accounts should be done if cash flow is under control and all current obligations are being met. Follow the tips below to pay off as many collections as possible with the smallest amount of money out of your pocket and the most positive impact on your credit. The main objective when negotiating collection accounts: to eliminate as many collection accounts to a $0 balance with the smallest total lump sum payment.

1. Create a list of all outstanding debt including the following information:

Original Creditor

Collection Agency

Amount Outstanding

Date the account was submitted to collections - this base date for calculating 7 years when it will drop off the credit report

2. Rank the outstanding debt in terms of urgency: The order will depend on the types of collection accounts you have. Some of the most effective ways to rank collection accounts are as follows:

Commented [TW39]: Objective: Show students the various ways they can deal with collection accounts, emphasizing caution and thorough record-keeping. Critical knowledge: Similar to credit card laws above—you have rights. Unlike credit cards—collectors are known to bend and break those rules more willingly. If something feels wrong, don’t hesitate to seek help. Don’t agree to anything unless you have it in writing, and even then, only if you’re comfortable with the terms.

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By Age of the Account: o Low priority should be given to collection accounts older than five years.

They will be dropping off the credit report within two years regardless of payment.

By the Amount Owed: o With a set amount of money, you could pay down several small collection

accounts or one large account. Having a smaller number of collection accounts with balances will result in a better credit score.

By Types of Accounts: o High priority should be given to tax liens, child support judgments, student

loan collections and other judgments to avoid wage and tax refund garnishment.

o High priority should be given to collection accounts that may prevent the client from obtaining housing in the future, such as debts owed to apartment complexes or utility companies.

By their Collection Status: o High Priority should be given to accounts that are still with the original

creditor, but at risk of being sent to collections. Negotiating this before it is transferred to a collection agency would be beneficial in maintaining good credit.

3. Collect a lump sum to offer as a settlement for each outstanding debt. If a

collection debt balance is too large to pay off all at once consider the potential of:

Using an upcoming tax refund to settle the balance

Saving up for a few months and then offering a lump sum

4. Try to avoid setting up a payment plan with a collection agency. A collection account is inherently negative. If you start to make ongoing payments, it may continue to get reported as recent activity on a negative account, prolonging the negative impact. EXCEPTION: Student Loans. Many times a borrower’s status can be returned to good standing by establishing a payment plan with the student loan collection agency and sticking to it.

5. Contact the Collection Agency to negotiate a lump sum payment. Collection

agencies will sometimes accept a reduced amount as payment in full. Making a first offer at about 33% less can be a good place to start. (In the past, Foundation Communities clients have been able to settle for about 60% of the outstanding debt.)

Never make or accept an offer that you cannot pay. You will only set yourself up for more problems by agreeing to pay an amount you can’t really pay.

Keep communication brief and to the point. Stay calm and professional.

Keep records of all communications.

Be sure they will accept that payment as “payment in full.”

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Things you should NOT do when negotiating with collection agencies: o Do not let collection agencies know how important or urgent it is to improve

your credit. o Do not let Collection Agencies know if funds are available to pay the full

amount. o Do not give them your bank information or pay by personal check. Mailing a

money order or cashier’s check is a good option.

How to contact the collection agencies: Telephone and mail are both perfectly acceptable ways to contact collection agencies. Either way, the client should simply state that they want to settle their account and make an offer for settlement. Explaining the whole story of how it all happened or getting emotional will not be beneficial.

Mail: A template for negotiating available later in this booklet. All correspondence should be mailed certified, with return receipt requested.

Phone: Document everything! Keep a log of everything that occurs during the phone conversation: date, time, caller’s name, company name, phone number, address where you can follow up, supervisor’s name and phone number, any agreements made. Politely demand information as much as they demand information. Act businesslike, you may be recorded. You can also record the conversation. It’s ok under Texas law as long as you are party to the call.

The collection agency may accept the offer, make a counter offer or reject the offer.

If they accept the offer, be sure to request written documentation, mailed, faxed, or e-mailed, that the debt will be settled in full once the agreed upon payment has been made. If they make a counter offer, make sure you can afford the amount. If they are unwilling to negotiate, or you cannot afford their counter-offer, there are three more options: Hang-up and call back another time. Often it is possible to reach another representative willing to negotiate. Move onto another collection account and try negotiations with them. Offer to pay the account in full and get a receipt.

6. Ask the Collection Agency to remove the account from your credit report. The collection agency is in no way obligated to remove the account from the credit report until 7 years after the date of collection. Until then, this is another bargaining tool for them.

7. Before sending any payment, get the agreement in writing. Ask the collection

agency to send you written documentation, mailed, faxed, or e-mailed, of all actions and promises (i.e. accepting negotiated amount as payment in full, removing the account from the credit report) before sending a payment.

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Proposal To Settle Account Sample Letter

To Whom It May Concern: I recently got a copy of my credit report and saw a collection account with your company. I am not currently able to pay the full amount of this account. I am committed to paying my debts and am willing to offer a settlement of _________cents on the dollar as payment in full. According to my records, my balance is $_______. Based on a settlement of ______%, I can make my payment in full of $________ by ________ (date). If you accept this proposal, please notify me at the address below and please be prepared to report this account as “paid in full” to all three credit reporting agencies once I have made the payments we agree upon, and indicate such in writing to me as soon as possible. Thank you. Sincerely, Bruce Smith Address City, State, Zip

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Resources To Help

You Reach Your

Financial Goal

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Foundation Communities Resources and Programs

Insure Central Texas: provides assistance enrolling in health insurance. Clients of any income level can receive help from one of our trained volunteers. North and South location. Walk-ins and appointments. www.insurecentraltx.org Tax Preparation*: is offered January through October 15th at our North and South location. January - April we open several additional locations. We accept walk-ins and appointments. www.communitytaxcenters.org Financial Coaching/ Credit Counseling*: matches clients with trained volunteers who work one-on-one with clients on financial topics such as creating household budgets, improving credit, reducing debt, and saving for the future. Make an appointment by visiting www.foundcom.org, emailing financialcoach@foundcom.org , or calling 512-610-4026. Money Management Class*: covers topics such as credit, debt, and savings in three 2 hour classes. Classes are offered at multiple locations in Austin. For a full schedule and to register online, visit www.foundcom.org , email mm@foundcom.org , or call 512-815-7184. Cash for College*: guides students through the financial aid process beginning with completing the Free Application for Federal Student Aid (FAFSA). Schedule an appointment by calling 512-610-4012 or emailing FAFSA@foundcom.org Scholarship Mentoring*: guides students through the process of identifying and applying for scholarships. Make an appointment by visiting the Cash for College page on www.foundcom.org Homebuyer Education Class*: helps new homebuyers navigate the process of purchasing a home. Classes are offered at multiple locations in Austin. Register by visiting www.foundcom.org or calling 512-815-7184. Matched Savings Program*: provides qualifying Foundation Communities' residents with the opportunity to open a savings account and receive $2 for every $1 saved toward buying a first home, funding post-secondary education or opening or expanding a small business. For more information visit http://foundcom.org/financial-stability/matched-savings/ or email IDA@foundcom.org College Access and Support Services Coordinator: College application and admissions guidance, college searches, financial aid follow-up, Scholarship Mentoring and Cash for College Program. *These programs and services are available to households earning less than $50,000 annually.

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Resources for Achieving Your Financial Goal

Money Managing Sites: These sites generally help you track spending, create budgets, and plan to increase savings and decrease debt. The sites link to your bank account through the bank’s online site. Top security measures are in place. All the sites listed are free (at least for the general version; some have a cost if you choose to upgrade).

Great videos on how to manage your money: www.bettermoneyhabits.com

General financial information with tons of cool tools and calculators: www.bankrate.com

United Way financial tool kit: www.uwatx.org/financialtoolkit

Great information on money essentials: http://money.cnn.com/magazines/moneymag/money101/

Site to educate people about personal finances. Good articles and tips found here: www.mymoney.gov

www.money.strands.com (English and Spanish versions available)

www.savvymoney.com

www.saveup.com Credit Card Resources:

Annualcreditreport.com: Go here for your free annual credit report.

Bankrate.com: A website that provides a variety of financial tools. Some of its resources includes comparing credit cards depending on your needs as well as a calculator to help you estimate your FICO score.

Creditkarma.com: A website that allows you to view your credit history and an estimate of your score. Please note that the score is not exact and may differ from your actual FICO score.

Creditcards.com: A website (based our of Austin, TX) that allows you to compare credit cards depending on your needs.

Quizzle.com: A website that provides a free credit score service.

Myfico.com: Go here to purchase your credit score. Retirement Resources:

myRA.gov: myRA is a Roth IRA that invests in a new U.S. Treasury retirement savings bond, which will not lose money (it earns the same interest rate as investments in the Government Securities Fund, a.k.a the “GFund”; the current interest rate is 1.5%). Individuals can open an account online at myra.gov or by calling 855-406-6972 (ITIN holders can only open an account by calling the phone line).

If you are uneasy about dealing with your money online: You can download the templates and create budgets and manage spending the old fashioned way, with good old pencil and paper.

Microsoft Money Managing Templates: http://office.microsoft.com/en-

us/templates/CT010117232.aspx

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For tips on how & why to move your money management life online:

Listen to the podcast found here: http://moneygirl.quickanddirtytips.com/smart-moves-to-manage-your-money-online.aspx

Tips on Borrowing Money:

www.unitedwayaustin.org/wp-content/uploads/2012/09/UW_Borrowing_FINAL.pdf Useful Blogs about money management: These blogs talk about personal debt reduction stories, spending and savings tips, and general financial knowledge.

www.thesimpledollar.com

www.wisebread.com

http://www.moneycrashers.com

Government Sites and Benefits:

A website to tell you more about government benefits in general: http://www.benefits.gov/

Check to see if you qualify for any Texas benefits with a short quiz and get information on how to apply: www.yourtexasbenefits.com

Federal Reserve Government Site: http://federalreserve.gov/

Cut your energy bills by following the tips on the website: http://hes.lbl.gov/consumer/

Same as 211 phone number; it gives you information about local services: www.211texas.com

For Students: Financial Aid Help:

A site to help explain financial aid and all of its forms: www.finaid.org

The official financial aid government site: www.fafsa.gov

More information on scholarships, exams, workshops, community events, and mucho more. We start working with students in middle school and their parents to help them prepare to be ‘college ready’: Cash for College Facebook Page (www.facebook.com then search for “Cash for College”)

Capital Idea: helps pay for tuition and fees and offers one-on-one supports to help you not only go back to school, but complete a degree! http://www.capitalidea.org/index.html

Workforce Investment Act: helps people with tuition to train or re-train for a career. http://www.twc.state.tx.us/boards/wia/txwia.html

College for all Texans: has financial aid application for undocumented students. www.collegeforalltexans.com

ACC offers English as a foreign language classes, Adult Basic education classes: www.austincc.edu

The Austin Academy provides GED classes, Adult Basic Education Classes and testing: http://www.austinacademy.org/services.php

Local public library/College library: A great place for many free resources!

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Don’t Forget to Budget in Some Fun!

Below are some resources for free or low cost fun around Austin: Texas State Capitol Complex and Tours: FREE tours are available daily and feature information about the Capitol, Texas history and the Texas legislature. Literature for self-guided tours is available in English, Chinese, French, German, Japanese, and Spanish! University of Texas: Tour UT the grounds and sculptures are lovely. The annual free Explore UT weekend is the biggest open house in Texas with all academic departments offering free goodies, demonstrations, and hands-on activities. It’s usually held one weekend in March. If you visit UT, make sure you catch the shops on The Drag – window shopping is free. Congress Avenue Bats: A visit to the Congress Avenue Bridge provides an awesome sight. Each evening, especially in the late summer and early fall, up to 1.5 million Mexican free-tailed bats emerge like a black cloud from beneath the bridge that they call home for around 8 months of the year. Zilker Botanical Garden: This 21-acre park in the Barton Springs area is open year-round and free to visit. There are multiple themed gardens, such as a romantic rose garden, butterfly garden, and Japanese garden complete with a koi pond. There is also a prehistoric garden; dinosaurs actually once roamed this area, so there is a life-sized dinosaur statue and plans from the Crustaceous period. Austin Town Lake: Hike and Bike Trail. Austin's Town Lake is the most visited hike and bike trail in Austin, winding 10 miles through downtown Austin. Mount Bonnell: Austin's Mount Bonnell is one of Austin's oldest tourist attractions being documented as far back as 1850. It is the highest point within Austin City Limits at 785 feet. A wonderful place to picnic in the sun, Mt. Bonnell contains views of Lake Austin and the Pennybacker or 360 Bridge as well as wonderful vistas of downtown. The area is a short hike from the road and there is no entrance fee. Movies in the Park at Republic Square: The Austin Parks Foundation often holds free movie nights in Republic Square Park, which is located in the middle of downtown Austin. The movies are projected on a huge outdoor screen, and attendees sit out on the grass lawn to watch. Dogs, lawn chairs, and picnic tables are allowed, though alcohol is not. Other Free Activities Are Listed In: The Austin Chronicle www.freefuninaustin.com www.austinfamily.com www.Do512.com www.parentwiseaustin.com

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Community Resources

General Resource Finder Texas 2-1-1: A great tool for finding resources near you. Simply dial 2-1-1 to get directed to food, housing, health and much more! Aunt Bertha: A website that generates local resources based on your zip code. Find food, housing, health care, job trainings and much more by visiting www.auntbertha.com Food Pantries Austin Food Bank: A website that finds food pantries that are nearest to you! https://www.austinfoodbank.org/food-assistance/get-food-now Free Cell Phone Services Assurance Wireless: government benefit program supported by the Federal Universal Service Fund for people enrolled in public assistance programs like Medicaid or SNAP or based on household income. http://www.assurancewireless.com/Public/Welcome.aspx Safelink: Government benefit program supported by the Federal Universal Service Fund for people enrolled in public assistance programs like Medicaid or SNAP or based on household income. https://www.safelinkwireless.com/Enrollment/Safelink/en/NewPublic/index.html FreedomPop: Provides free mobile services in the same way Skype provides free voice, Dropbox free data and Spotify free music. FreedomPop currently offers free 4G mobile phone service, free wireless internet, and free home broadband to all Americans. http://www.freedompop.com/ Childcare Assistance Resource Texas Workforce Commission for parents who work, attend school, or participate in job training. http://www.twc.state.tx.us/jobseekers/child-care-services 2-1-1's Childcare Locator: http://www.211texas.org/

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Eating Healthy on a Budget

Austin Food Bank: Has a list of resources along with online cookbooks that are free for you to download! https://www.austinfoodbank.org/get-help/eat-healthy USDA’s Healthy Eating on a Budget: This website provides tips and materials to make healthy eating on a budget easy! It will help you create a shopping plan along with a meal plan for the entire week. http://www.choosemyplate.gov/budget Capital Area Food Bank: The Healthy Recipe Database is a free resource for delicious, healthy, and affordable recipes. These recipes are designed specifically for individuals to utilize common Food Bank ingredients. https://www.capitalareafoodbank.org/programs/capacity-building/recipes/#main Recipe Rainbow: This is a food recipe generator created by the Greater Pittsburgh Community Food Bank. Enter the ingredients you already have in your home to discover nutritious and delicious recipes! https://www.pittsburghfoodbank.org/resources/recipe-rainbow/

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Professional Development

Skillpoint Alliance: Skillpoint Alliance is a nonprofit based in Austin, Texas that provides a Gateway program which allows people to earn certificates in select fields in order to advance their career. Gateway provides free valuable and rapid training and education, preparing participants for entry-level employment in as little as four to eight weeks. http://skillpointalliance.org/the-programs/gateway-program/gateway-courses/ Goodwill Career and Technical Academy: Goodwill makes it convenient for you to take the first step toward a better future. We will equip you with the tools you need to compete for jobs that are in high-demand and provide you continuous support to ensure stability and stellar performance in the workplace. https://www.goodwillcentraltexas.org/education-job-training Workforce Solutions: An organization focused on helping people get back into their career. Their services include assistance with your job search, resume, preparation for interviews and getting a GED. http://www.wfscapitalarea.com/JobSeekers.aspx

AARP- Senior Community Service Employment Program: The program provides

comprehensive training and support that helps individuals to obtain new job knowledge,

enhance existing skills, gain a competitive edge in today’s job market, find and maintain

employment. To be eligible for SCSEP, applicants must be unemployed, 55 or over, meet

income guidelines and be interested in bettering their current employment circumstances.

512-391-9299

Lisa’s Hope Chest: A nonprofit based in Austin that provides gently used professional clothing free of charge for both men and women in need. Visit http://www.lisashopechest.org/ or call 512-457-0999 for more information. Women 2 Women- Dress for Success Austin: An organization that provides women with the resources to gain professional attire, a network of support and career development tools to help them thrive in a professional setting and life in general. If interested please contact Tara (tara.welton@foundcom.org) to get a referral. https://austin.dressforsuccess.org/

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Reduce Expenses: Energy

Heating & cooling is the largest energy user in your home. Complete this worksheet to see how much you could save simply by adjusting your thermostat. The

larger the adjustment, the greater the savings!

*Note: These savings are based on figures provided by the United States Department of Energy, which says that there is an average of 3% savings per degree of 24-hour thermostat increase/setback.

Money Saving Thermostat Settings!

When You Aren’t Home

Turn it OFF!

When You’re Home (In the Summer)

75⁰-80⁰

When You’re Home (In the Winter)

68⁰-73⁰

Commented [TW40]: Objective: The following worksheets are in addition to the Saving Green curriculum. Students can complete these worksheets on their own time to see how much they could potentially save in their home.

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Reduce Expenses: Water

Showers, faucets, and leaks account for HALF of your water bill. Let’s find out how much you

can save by making a few changes! Did you know…

A conservative 5-minute shower can save 2,700 gallons of water per person every year!

Hand-washing dishes uses about 23 more gallons of water per “load” compared to running a fully-loaded dishwasher.

Faucets that leak at one drip per second waste 3,000 gallons per year! A leaky toilet uses an average of 200 gallons of water every day.

Showers Fill in the shaded boxes to find your personal shower savings.

Faucets and Dishes Circle the true statements.

I usually hand-wash my dishes …….………………………………………………… $121

I usually pre-rinse my dishes before putting them in the dishwasher …………… + $86

I usually keep the tap running while I brush my teeth ……..…………………...... + $58

Leaks Circle the true statements.

I have a leaky toilet …….……………………………………………………………… + $840

I have a leaky sink ……..……………………………………………………………… + $43

5-minute showers Cost per Year (per person)

Total cost of each item you circled =

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Reduce Expenses: Indoor Air Quality

Conventional cleaners are very costly! Find out how much you can save by making your own cleaning solutions, putting a stop on air freshening purchases, and using reusable cleaning

supplies! Answer the questions below. Circle your answer and then record the underlined cost on the corresponding line.

Example: Are you ready to learn how you can save? a. Yes! $0.00 to complete this worksheet! b. No! $XX.XX for not improving my indoor air quality!

1. Do you clean with washable dish cloths? a. Yes! $12.00 per year for new washable dish cloths b. No! $96.00 per year for disposable paper towels, cleaning

wipes, sponges, etc…

2. Do you make your own all-purpose spray using vinegar and water? a. Yes! $6.00 per year for a large bottle of white distilled vinegar b. No! $12.00 per year for Fabuloso (or similar commercial

all-purpose spray)

3. Do you use air freshening sprays or plug-ins? Or scented candles? a. Yes! $20.00 per year on air freshening purchases b. No! $0.00 per year to open my windows for clean, fresh air

(I know a clean home should smell like nothing at all!)

4. Do you regularly clean with bleach? a. Yes! $16.00 per year on bleach b. No! $8.00 per year on baking soda

5. Do you use vinegar and baking soda to clean your toilet bowl?

a. Yes! $8.00 per year on vinegar and baking soda b. No! $24.00 per year on Lysol (or similar commercial

toilet bowl cleaner)

$____0.00

$

$

$

$

$

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Reduce Expenses: Waste

According to estimates from the EPA (Environmental Protection Agency), each person in the US creates an average of 4.5 pounds of garbage a day, totaling 1.35 billion pounds of

garbage/day, or 6,750 blue whales. Answer the questions below. Circle your answer and then record the underlined cost on the corresponding line.

Example: Are you ready to learn how you can save? c. Yes! $0.00 to complete this worksheet! d. No! $XX.XX for always using disposables.

6. Do you shop with reusable bags at the grocery store? a. Yes! $4.00 per year for reusable bags b. No! $12.00 per year for paper or plastic bags

7. Do you always use a reusable water bottle? a. Yes! $7.50 per year for a reusable water bottle b. No! $60.00 per year for disposable plastic bottles

8. Do you package food in ‘Zip-Lock’ or paper bags?

a. Yes! $24.00 per year on disposable bags b. No! $5.00 per year on ‘Rubbermaid’ containers

9. Do you use paper napkins when you eat? a. Yes! $24.00 per year on disposable paper napkins b. No! $10.00 per year on washable napkins

10. Do you use plastic utensils or paper plates when you are

eating meals at home, hosting friends, or packing lunch? a. Yes! $36.00 per year on disposable cutlery & plates b. No! $10.00 per year on reusable cutlery & plates

Notes

$____0.00

$

$

$

$

$

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Post-Test

Name: __________________________________ Date: ______________________

1. Which of the following is NOT one of the three national credit reporting bureaus? Equifax (EFX) Fico (FCO) TransUnion (TUC) Experian (XPN)

2. Paying more than the minimum balance on a credit card each month will reduce (1)

the amount of money you will have to pay and (2) the amount of time it will take to pay off the card. True False

3. Which is a way of “paying yourself first” by setting aside money to apply toward the

things you’d like to achieve later in life?

Budgeting Spending Saving Planning

4. Bankruptcy is the best option for eliminating all debt.

True False

5. Which of the following has the biggest impact on your energy bill?

Refrigerator Lights Heat and Air Conditioning Television

6. A negative financial event, such as a delinquent payment or a loan default, stays on your credit report for how long? 5 years 3 years 7 years Forever

7. Which of the following will not improve your credit score?

Paying bills on time Maintaining a balance under 30% of the credit card limit

Paying cash for everything

8. Which factors are most important when calculating your credit score?

Credit inquiries and amounts owed Length of credit history and amounts owed

Payment history and amounts owed

FLIP OVER

Commented [TW41]: Have students complete this test before they leave!

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9. Pick the green action(s) that can save you money (Check all that apply). Make homemade cleaners Wash dishes by hand 5-minute showers

10. It’s only free to look at once a year but you are always entitled to look at your credit report.

True False

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Course Evaluation

1. Do you feel that pertinent topics were addressed during the course? Definitely Adequately Somewhat A Little Not at all Are there any additional topics you would have liked to address?

2. Did the instructor cover materials in a thorough and efficient manner?

Definitely Adequately Somewhat A Little Not at all Comments

3. Did the instructor create a comfortable environment within the classroom? Definitely Adequately Somewhat A Little Not at all Comments

4. Are there any other topics you would like to have covered or would like to address in the

future?

Comments