Building Wealth A BEGINNER’S GUIDE TO SECURING YOUR FINANCIAL FUTURE,
[ Pobierz całość w formacie PDF ]
Building
W
ealth
A BEGINNER’S GUIDE TO SECURING YOUR FINANCIAL FUTURE
Federal reserve Bank oF dallas
TABlE oF coNTENTS
Introduction: Building Wealth
..................................... 1
➀
Wealth Creation: Learn the Language
.......................... 2
➁
Budget to Save
.............................................. 4
➂
Save and Invest
............................................ 10
➃
Take Control of Debt
........................................ 19
➄
Protect Your Wealth
......................................... 25
Review
....................................................... 29
Glossary
...................................................... 30
Buying a home, saving for retirement or
for children’s education, or even effectively
managing the family budget now requires
more financial sophistication than ever
before. Financially literate consumers
make the financial marketplace work
better, and they are better-informed
citizens as well.
Ben S. Bernanke, Chairman,
Federal Reserve System
Resource Guide
................................................ 33
Building Wealth: A Beginner’s Guide to Securing Your Financial Future
offers introductory guidance to individuals and families seeking help
to develop a plan for building personal wealth. While a comprehensive
discussion of accounting, finance and investment options is beyond
the scope of this workbook, it presents an overview of personal wealth-
building strategies. For more information and assistance, consult the
resource guide at the back. For additional copies of this workbook (also
available in Spanish), call (800) 333-4460, ext. 5254, or order from the
Dallas Fed’s web site, www.dallasfed.org. An animated CD-ROM ver-
sion of this guide has been developed for individuals to use at their
home computer or for multiple users in classrooms and computer
labs. This interactive program is also available at www.dallasfed.org.
Building Wealth: A Beginner’s Guide to Securing Your Financial Future
may be reproduced in whole or in part for training purposes, provided it
includes credit to the publication and the Federal Reserve Bank of Dallas.
Building
W
ealth
You can create personal wealth. It’s possible to meet your financial
goals. By choosing to budget, save and invest, you can pay off debt,
send your child to college, buy a comfortable home, start a business,
save for retirement and put money away for a rainy day. Through
budgeting, saving and investing, and by limiting the amount of debt
you incur, all these goals are within your reach.
DEFINING WEALTH
Some people consider themselves wealthy because they live in a very
expensive house and travel around the globe. Others believe they are
wealthy simply because they’re able to pay their bills on time. What
we are talking about here is financial wealth and what it means to you.
In the following space, write your definition.
Examples: Wealth is…
Wealth is…
1.
being able to put my kids through college.
1.
2.
having enough money to buy a house.
2.
3.
Now that you have defined what wealth means to you, how do you
acquire it?
Building wealth requires having the right information, planning
and making good choices. This workbook provides basic informa-
tion and a systematic approach to building wealth. It is based on
time-honored principles you probably have heard many times
before—budget to save; save and invest; control debt; and protect
the wealth you accumulate.
Federal Reserve Bank of Dallas
1
➀
Wealth
C
reation:
You want to create personal wealth, right? So does Bob.
Bob is 35 and works for a manufacturing company. He looked
at his finances and realized that at the rate he was going, there
wouldn’t be enough money to meet his family’s financial goals.
So he chose to embark on a personal wealth-creation strategy.
His first major step was to pick up a copy of this workbook for guid-
ance. Bob began by learning the language of wealth creation. The
first lesson was to understand the meaning of
assets
,
liabilities
and
net worth
. They make up this very important formula:
Bob
AssETs
–
LIABILITIEs
=
NET WorTH
Accumulating wealth—as distinct from
just making a big income—is the key to
your inancial independence. It gives you
control over assets, power to help shape
the corporate and political landscape,
and the ability to ensure a prosperous
future for your children and their heirs….
Rev. Jesse L. Jackson, Sr. and Jesse L. Jackson, Jr.,
A wealth-creating
asset
is a possession that generally increases in
value or provides a return, such as:
•
A savings account.
•
A retirement plan.
•
Stocks and bonds.
•
A house.
Some possessions (like your car, big-screen TV, boat and clothes)
are assets, but they aren’t wealth-creating assets because they don’t
earn money or rise in value. A new car drops in value the second it’s
driven off the lot. Your car is a tool that takes you to work, but it’s not
a wealth-creating asset.
It’s About the Money!
A
liability
, also called debt, is money you owe, such as:
A home mortgage.
The market value of a home is an asset;
the mortgage, a liability. Let’s say your house is
worth $120,000, but your mortgage is $80,000.
That means your equity in the home is $40,000.
Equity contributes to your net worth.
•
Credit card balances.
•
A car loan.
•
Hospital and other medical bills.
•
Student loans.
Net worth
is the difference between your assets (what you own) and
your liabilities (what you owe). Your net worth is your wealth.
2
Federal Reserve Bank of Dallas
Learn the Language
•
To calculate how much he is worth, Bob used the following formula:
Assets
–
Liabilities
=
Net
Worth
. He made a balance sheet listing all his
assets and all his liabilities. He listed his wealth-building assets first.
Bob discovered his net worth is $21,600. Using Bob’s balance sheet
as an example, figure your own net worth. Be sure to add any assets
and liabilities you have that are not listed here. Remember that net
worth is your wealth. Are you worth as much as you want to be?
Bob’s Balance Sheet
My Balance Sheet
Wealth-building assets
Amount
Wealth-building assets
Amount
Cash
$ 1,500
Cash
Savings account
Stocks, bonds and ther invstments
401 (k) rtirement plan /IRA
Markt value f home
Other assets
Markt value f car
Savings account
1,000
Stocks, bonds and ther invstments
5,000
401 (k) rtirement plan /IRA
25,000
Markt value f home
0
Other assets
Markt value f car
14,000
Total assets
$ 46,500
Total assets
Liabilities
Amount
Liabilities
Amount
Home mortgage
$
0
Home mortgage
Home equity loan
Home equity loan
0
Car loan balance
13,000
Car loan balance
Credit card balancs
Student loan
Child suport*
Miscellaneous liabilitis
Credit card balancs
3,000
Student loan
5,000
Child suport*
2,400
Miscellaneous liabilitis
1,500
Total liabilities
$ 24,900
Total liabilities
Net worth
$ 21,600
Net worth
*Represents one year of payments.
Federal Reserve Bank of Dallas
3
[ Pobierz całość w formacie PDF ]
zanotowane.pl doc.pisz.pl pdf.pisz.pl lemansa.htw.pl
Building
W
ealth
A BEGINNER’S GUIDE TO SECURING YOUR FINANCIAL FUTURE
Federal reserve Bank oF dallas
TABlE oF coNTENTS
Introduction: Building Wealth
..................................... 1
➀
Wealth Creation: Learn the Language
.......................... 2
➁
Budget to Save
.............................................. 4
➂
Save and Invest
............................................ 10
➃
Take Control of Debt
........................................ 19
➄
Protect Your Wealth
......................................... 25
Review
....................................................... 29
Glossary
...................................................... 30
Buying a home, saving for retirement or
for children’s education, or even effectively
managing the family budget now requires
more financial sophistication than ever
before. Financially literate consumers
make the financial marketplace work
better, and they are better-informed
citizens as well.
Ben S. Bernanke, Chairman,
Federal Reserve System
Resource Guide
................................................ 33
Building Wealth: A Beginner’s Guide to Securing Your Financial Future
offers introductory guidance to individuals and families seeking help
to develop a plan for building personal wealth. While a comprehensive
discussion of accounting, finance and investment options is beyond
the scope of this workbook, it presents an overview of personal wealth-
building strategies. For more information and assistance, consult the
resource guide at the back. For additional copies of this workbook (also
available in Spanish), call (800) 333-4460, ext. 5254, or order from the
Dallas Fed’s web site, www.dallasfed.org. An animated CD-ROM ver-
sion of this guide has been developed for individuals to use at their
home computer or for multiple users in classrooms and computer
labs. This interactive program is also available at www.dallasfed.org.
Building Wealth: A Beginner’s Guide to Securing Your Financial Future
may be reproduced in whole or in part for training purposes, provided it
includes credit to the publication and the Federal Reserve Bank of Dallas.
Building
W
ealth
You can create personal wealth. It’s possible to meet your financial
goals. By choosing to budget, save and invest, you can pay off debt,
send your child to college, buy a comfortable home, start a business,
save for retirement and put money away for a rainy day. Through
budgeting, saving and investing, and by limiting the amount of debt
you incur, all these goals are within your reach.
DEFINING WEALTH
Some people consider themselves wealthy because they live in a very
expensive house and travel around the globe. Others believe they are
wealthy simply because they’re able to pay their bills on time. What
we are talking about here is financial wealth and what it means to you.
In the following space, write your definition.
Examples: Wealth is…
Wealth is…
1.
being able to put my kids through college.
1.
2.
having enough money to buy a house.
2.
3.
Now that you have defined what wealth means to you, how do you
acquire it?
Building wealth requires having the right information, planning
and making good choices. This workbook provides basic informa-
tion and a systematic approach to building wealth. It is based on
time-honored principles you probably have heard many times
before—budget to save; save and invest; control debt; and protect
the wealth you accumulate.
Federal Reserve Bank of Dallas
1
➀
Wealth
C
reation:
You want to create personal wealth, right? So does Bob.
Bob is 35 and works for a manufacturing company. He looked
at his finances and realized that at the rate he was going, there
wouldn’t be enough money to meet his family’s financial goals.
So he chose to embark on a personal wealth-creation strategy.
His first major step was to pick up a copy of this workbook for guid-
ance. Bob began by learning the language of wealth creation. The
first lesson was to understand the meaning of
assets
,
liabilities
and
net worth
. They make up this very important formula:
Bob
AssETs
–
LIABILITIEs
=
NET WorTH
Accumulating wealth—as distinct from
just making a big income—is the key to
your inancial independence. It gives you
control over assets, power to help shape
the corporate and political landscape,
and the ability to ensure a prosperous
future for your children and their heirs….
Rev. Jesse L. Jackson, Sr. and Jesse L. Jackson, Jr.,
A wealth-creating
asset
is a possession that generally increases in
value or provides a return, such as:
•
A savings account.
•
A retirement plan.
•
Stocks and bonds.
•
A house.
Some possessions (like your car, big-screen TV, boat and clothes)
are assets, but they aren’t wealth-creating assets because they don’t
earn money or rise in value. A new car drops in value the second it’s
driven off the lot. Your car is a tool that takes you to work, but it’s not
a wealth-creating asset.
It’s About the Money!
A
liability
, also called debt, is money you owe, such as:
A home mortgage.
The market value of a home is an asset;
the mortgage, a liability. Let’s say your house is
worth $120,000, but your mortgage is $80,000.
That means your equity in the home is $40,000.
Equity contributes to your net worth.
•
Credit card balances.
•
A car loan.
•
Hospital and other medical bills.
•
Student loans.
Net worth
is the difference between your assets (what you own) and
your liabilities (what you owe). Your net worth is your wealth.
2
Federal Reserve Bank of Dallas
Learn the Language
•
To calculate how much he is worth, Bob used the following formula:
Assets
–
Liabilities
=
Net
Worth
. He made a balance sheet listing all his
assets and all his liabilities. He listed his wealth-building assets first.
Bob discovered his net worth is $21,600. Using Bob’s balance sheet
as an example, figure your own net worth. Be sure to add any assets
and liabilities you have that are not listed here. Remember that net
worth is your wealth. Are you worth as much as you want to be?
Bob’s Balance Sheet
My Balance Sheet
Wealth-building assets
Amount
Wealth-building assets
Amount
Cash
$ 1,500
Cash
Savings account
Stocks, bonds and ther invstments
401 (k) rtirement plan /IRA
Markt value f home
Other assets
Markt value f car
Savings account
1,000
Stocks, bonds and ther invstments
5,000
401 (k) rtirement plan /IRA
25,000
Markt value f home
0
Other assets
Markt value f car
14,000
Total assets
$ 46,500
Total assets
Liabilities
Amount
Liabilities
Amount
Home mortgage
$
0
Home mortgage
Home equity loan
Home equity loan
0
Car loan balance
13,000
Car loan balance
Credit card balancs
Student loan
Child suport*
Miscellaneous liabilitis
Credit card balancs
3,000
Student loan
5,000
Child suport*
2,400
Miscellaneous liabilitis
1,500
Total liabilities
$ 24,900
Total liabilities
Net worth
$ 21,600
Net worth
*Represents one year of payments.
Federal Reserve Bank of Dallas
3
[ Pobierz całość w formacie PDF ]