PF- 1 Introduction to Financial Literacy, Self-Assessment, & Taking Responsibility- (Sec. 1,2,3 of 3)- (8/21/17Mon.)

Ch. 1, Sec. 1: Thomas is thinking about the car he wants to buy in a few years. He doesn't know what he should do right now so that he can buy the car. What should Thomas do?

- He should set aside $100 per month to put in a savings account. - He should try to spend less and put whatever he can in a safe place. - He should wait a few years and take out a car loan for the full cost of the car. - He should become more knowledgeable about smart ways to save and about car loans. answer: - He should become more knowledgeable about smart ways to save and about car loans.

Ch. 1, Sec. 2: Read the following two descriptions. Decide who has better financial habits and attitudes.

- Lindsay doesn't feel that she will ever get her credit card paid off. After seeing her new bill, she tosses it aside so she doesn't have to think about it. - Hillary receives a few bills in the mail. She takes out a piece of paper and starts figuring out a plan to pay these bills. answer: - Hillary receives a few bills in the mail. She takes out a piece of paper and starts figuring out a plan to pay these bills.

Ch. 1, Sec. 2: Erin is in high school. She decides that she will set aside money to put in her savings account each week from the money she makes babysitting. This is a bad habit.

- True - False answer: - False

Ch. 1, Sec. 2: Sam will finish high school this year. He does not think he needs any further education. This is a misconception.

- True - False answer: - False

Ch. 1, Sec. 3: To become financially responsible, you need to accept that you are accountable for your financial future.

- True - False answer: - False

Ch. 1, Sec. 3: Your financial decisions will only affect yourself and nobody else.

- True - False answer: - False

Ch. 1, Sec. 2: A misconception is a misunderstanding.

- True - False answer: - True

Ch. 1, Sec. 1: Select the items from the following list that are included in financial literacy.

- applying for a credit card - using a credit card to make a purchase - paying taxes - opening a checking account - selecting a college - deciding to rent an apartment answer: - selecting a college

Ch. 1, Sec. 1: Financial literacy is knowledge about _____.

- banks - money - reading financial books - investing answer: - money

Ch. 1, Sec. 3: Which of the following is an example of financial responsibility?

- borrowing from your brother to make a car payment - having medical insurance - spending money before you have earned it - making impulse buys at the grocery store answer: - having medical insurance

Ch. 1, Sec. 2: Select the items from this list that are examples of good financial habits.

- creating a budget no matter what your age - asking advice from employees at a bank or financial advisers - buying stock before you have a steady income - keeping good records - saving as soon as you have a full-time job answer: - creating a budget no matter what your age - buying stock before you have a steady income - saving as soon as you have a full-time job

Ch. 1, Sec. 3: Read the following actions and decide if they are responsible or irresponsible. 1. earning interest: 2. living with your parents: 3. avoiding fees and penalties: 4. missing out on adventures because you don't have the money saved: 5. asking your parents for money: 6. having money saved up: 7. being accepted for a loan: 8. being rejected for a credit card: 9. not being able to pay for car repairs:

- irresponsible - responsible answer: 1. responsible 2. irresponsible 3. irresponsible 4. irresponsible 5. irresponsible 6. responsible 7. responsible 8. irresponsible 9. irresponsible

Ch. 1, Sec. 1: A good steward _____.

- is responsible and careful with God's resources - is careless with money - spends more money than he or she can afford - owns everything answer: - is responsible and careful with God's resources

Ch. 1, Sec. 3: Which of the following is an example of financial irresponsibility?

- organizing financial documents - paying car payments on time - spending your entire paycheck - finding a new job before quitting your current job answer: - spending your entire paycheck

Ch. 1, Sec. 3: Which is an example of financial honesty?

- overestimating income on a loan application - taking advantage of the consumer by hiding fees - purposely omitting information when completing a financial form - paying back the amount owed answer: - paying back the amount owed

Ch. 1, Sec. 1: List some reasons for becoming financially literate.

Writer: Becoming better stewards, reducing stress, and saving money.

Ch. 1, Sec. 1: Carl started earning a paycheck and wants to invest some of what he earned. In this situation, why is it important for Carl to be financially literate?

Writer: Financially literate will enable you to make smart decisions about money and to become better stewards of God's resources.

Ch. 1, Sec. 2: If you haven't already, take a look at your score on the self-assessment you took earlier in this lesson. Study the feedback for each item. In the text box below, enter a brief statement about any misconceptions you've had about what it means to be financially literate. Also, enter a brief statement about financial habits or attitudes that you discovered about yourself-both good and bad.

Writer: I thought that to be financially literate is that you have to be able to make money without running out of them. The good news about my attitudes is being patient with making money. The bad news about my habit is borrowing money from the bank and have to pay them back.

Ch. 1, Sec. 3: Lisa and her husband would like to buy a house soon. She continuously pays bills late. How do her actions affect herself and others?

Writer: She wasn't responsible to pay for the house and was late to pay the bills. It would hurt her husband's feeling because she had one job and she blew it.

misconception

a misunderstanding; a mistaken thought or idea

warranty

a written guarantee given to the purchaser, usually specifying that the manufacturer will make any repairs or replace defective parts free of charge for a certain period of time

responsible

accountable, reliable, dependable

literacy

an individual's knowledge of a certain area or field

Ch. 1, Sec. 2: A(n) _______ is a misunderstanding; a mistaken thought or idea.

answer: - misconception

financial

anything that has to do with money and investments

stewardship

careful and responsible management of God's resources, including money

tithing

contributing to the church one-tenth of the resources God has given you, including your income

Financial literacy

knowledge about money and what you can do with money