Financial Literacy
Handbook
Why is it important to care about
creating a budget, saving money
or making sure that you have
good credit?
Because it’s YOUR money.
Money allows you to
buy things that you
need and want.
By setting goals, saving your money and making sure you have high credit, you can buy bigger and better things that you really want and need. Let’s first talk about money.
WHAT IS MONEY?
Money is used to buy Goods or Services that you Want and Need. Money usually comes in the form of coins and bills.
DID YOU KNOW?
What are Goods
and Services?
Goods = Objects
Goods are things that are made or grown. You can touch a good. Many times, goods are made fromnatural resources.
Services = Actions
Services are work that someonedoes for someone else. A doctor, a barber and a chef
are examples of people that perform services for people.
Needs vs. Wants
Can you identify a Need or a W
ant?
NEEDS are things that we need to survive.
Some things we NEED are nutritious food, water, shelter and clothes.
WANTS are things we would like to have.
Some things we WANT are toys, video games, candy and electronics.
Most people have jobs so then can pay for the things they need and some of the things they want. Deciding what is a Need and a Want is hard sometimes. A budget can help you decide what you really need and what you want.
Circle the Needs and put an X through the W ants.
Income > Spending = Savings Income < Spending = Debt
A budget is a step by step plan to help you reach your money goals.
Start by writing down how much money you make. Then write down how much money you spend. Subtract the money you spend from the money you make. The amount that is left is how much you saved.
You can save more by spending less and deciding if something is really a Need or just a Want. Learning the difference between Needs and Wants will lead to making GOOD spending choices.
What is a budget?
Learning to make
good spending
choices will help
you make sure you
first take care of
your Needs and
then your Wants.
Remember that we can’t have all the money we want and that we do have to make choices. Once you have taken care of your needs, the money left can be saved to buy the things you want.
It all adds up!
1 McDonalds®
Big Mac @ $4.59
$4.59 x 7 days = $32.13 $4.59 x 365 days = $1,675.351 Bag of
CHEETOS® @ $1.09
$1.09 x 7 days = $7.63 $1.09 x 365 days = $397.85It all adds up!
Start by making a list of
things you want and put
them in the order that is
most important to you.
You should think about the reasons why you want to buy it and reasons you don’t want to buy it. This will help you keep only a few items on your list that you really want.Now it’s time to save your money so you can buy those really cool things.
How do I save money?
You can start by using a piggy bank or even a jar to keep your money in. Remember to write down
your budget with how much money you have to start with, how much money you make and how much the things you want cost. You should write down how much money you added every week to show how much closer you are getting to your goal. It is also important to save for emergencies. This helps you prepare for the unexpected things that happen in life. Another way you can save your money is to open a savings or checking account with a bank.
What is a savings account?
A savings account is where you can put your money in a bank and earn more money for saving it there. That’s right, the bank will reward you for saving your money with them by paying you interest.
FDIC Insurance
Make sure your account is with a bank that is FDIC insured. When your deposits are FDIC-insured, you can’t lose a penny, no matter what.
How do I save money?
So why do I need a bank account?
Interest will help you save more money faster. The bank will keep your money safe. No matter what, even if the bank is robbed or goes out of business, your money is SAFE. The bank also allows you different ways to get your money like ATM’s, debit cards and the internet.
What is a checking account?
You can open a checking account in a bank that allows you easier access to your money than a savings account. A checking account gives you access to your money without having to carry cash.
A checking account is great when you need to pay bills, buy groceries or go to the movies. When you open a checking account, the bank will give you a check book and a debit card. The check book lets you write a check to a person or business and they can go to their bank, give them the check and the bank will transfer your
Credit is money that you borrow to pay for things that you don’t have enough money saved to buy.
This is sometimes called a loan or a debt. Most of the time when you borrow money, you have to pay interest on top of paying the loan back. So it will cost you money to borrow money.
Your credit will be measured with a credit score and credit report. Lenders will review your credit score and credit report to review your payment history and determine if you should be given a loan or credit card. Your credit will also be used for insurance and even renting an apartment.
What is credit?
THE COST O F C RED IT
Interest
Money you pay for using someone else’s money.
Fees
When you pay your debts on time, you build high credit. When you are late making payment or don’t pay it back at all, you build low credit. Building high credit is very important when you want to buy a house, a car or even start a business.
Going to college and continuing your education is very important and will help you gain the tools and knowledge to be successful in the workforce. It is important to start saving for college now.
If you don’t save enough, it’s not the end of the world. There are a lot of programs that provide financial aid, grants and scholarships which will help you pay for school. You can also get a student loan.
There are two types of student loans: federal loans and private loans. Both of them will require you to pay interest on the amount that you borrow until you pay back the loan. Remember that people that earn a degree may enjoy more job security and earn a higher income.
How do I pay
for college?
BE
SMART
WITH
YOUR
MONEY!
It’s your money and making good
spending choices will help you
achieve your goals as you get older.
Establish what your Needs and Wants are and make a budget. Keep track of your money and what you spend it on. The more you SAVE, the
more money you will have to buy the things you need and want as well as being prepared
Down
1. Money you earn for saving in a bank.
3. Money you borrow to pay for things you don’t have enough money saved to buy.
5. Money that comes in from a job. 7. Things you buy that you can touch. Across
2. You use this to buy good and services. 4. Work that someone does for someone else.
6. A step by step plan to help you reach your money goals.
8. Things we need to survive.
6. Budget, 7. Goods, 8. Needs
Fill in the ‘Banc’
LEARN THE
VALUE OF
SAVING.
IT IS AN
INVESTMENT IN
YOUR
FUTURE.
CONTINUE ON THE
PATH TO FINANCIAL
LITERACY.
Fill out this form, have your parent or guardian
co-sign it and bring it into one of our branches.
We will email you information about upcoming
financial literacy events sponsored by Banc
of California.
And you can earn $10 just by
opening your own savings account.
Name Age
Email Address
bancofcal.com 877-770-BANC (2262)
Welcome to California’s Bank.
With 38 banking locations throughout Southern California, we’re here to serve you
in your neighborhood. Anaheim - Main
Anaheim Hills Brea Century City - Private
Century City Commerce Costa Mesa Downey Fullerton - East Fullerton - West Garden Grove Hacienda Heights Irvine - Headquarters La Habra La Habra Fashion Square
La Jolla La Mirada Laguna Hills Long Beach Los Angeles Manhattan Beach Montebello Newport Beach Pacific Palisades Paramount Pasadena Placentia Rancho Bernardo Rancho Santa Fe Rowland Heights San Marcos Santa Barbara Santa Fe Springs Santa Monica Tustin Whittier Whittier - East Wilmington
