EverFi: Financial Literacy Module 1

Helps you keep track of expenses Helps you remember to "pay yourself first" Lets you see where you can cut some expenses.

3 ways that a budget helps you

Bringing a popcorn instead of buying some Cutting off data outside as much as you can Making your own food and not eating out often

3 ways you could cut expenses

Pay the interest

Borrower

Earns money on principal and interest (interest on interest). Money grows at a changing rate. Exponential Growth.

Compound interest

How often your bank pays or charges interest.

Compounding Frequency

The most powerful compounding frequency. It will grow your money the fastest.

Daily Compounding

Learn to live upon less than you earn Seek advice from those who are knowledgeable Make your wealth work for you. A part of all I earn is mine to keep.

Four Laws that Govern the Building of Wealth

Fee someone pays to be able to borrow money

Interest

Receive the interest

Lender

Sum of money you put into an account or the amount of money you owe on a debt

Principal

A plan on how to save your money.

Purpose of a budget

A quick way to estimate how long it will take money to double. 72/interest rate= number of years for your money to double.

Rule of 72

Accounts designed to let you set aside money that is separate from your checking account.

Savings Vehicle

Earns interest on principal only. The money grows at a constant rate. Linear Growth.

Simple Interest

Savings account, money market accounts, Certificate of Deposit.

Three types of savings vehicles