1. costs of education and training 2. paying for education and training 3. training and skills for...
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1. Costs of education and training
2. Paying for education and training
3. Training and skills for job success
4. Career choices and income
CHOICES THAT AFFECT INCOME
What significantly affects your potential earning power?
EDUCATION!!
Education pays in higher earnings and lower unemployment rates
Education ChoicesFormal education – classes, programsInformal education – on the job
training, learn as you goAmount and type of education can affect
the amount of money you earnIf pay is high compared to education
required, there is a reasonThink about how for you want to goThink about how it will prepare you
professionally
Costs of Education & Training
Tuition – investment in your education
Room/board, books, supplies, fees are additional
Most likely, your earning potential will be rewarding for the cost of higher educationBachelor’s, Master’s Degrees
A BA/BS can pay up to 1 million $ more over a lifetime over a HS diploma (potential earning power)
Your OptionsCommunity CollegeTrade SchoolCareer and Technical SchoolsApprenticeshipsPublic over Private college educationGraduate programs & post baccalaureate
certs.
Paying for All of This
Loans & Grants Financial Aid – money you receive from
outside source to help you pay for educationLoan: assistance from a bank that must be
repaid with interest (awarded to almost anyone)
Grant: government money that is not repaid (must qualify)23 years old and under – parent must file
w/ student income24 years and older – independent;
student files
Paying for All of This cont’d
Interest: the cost of your loanSubsidized student loan: interest is not
charged until you graduateUnsubsidized student loan: interest is
charged starting the day loan is issuedYou do not have to begin paying either
until after graduationYou may pay as you goFAFSA
Paying for All of This cont’d
Private student loans: issued by a bank or credit unionHigher interest rates because they are not
from the governmentUsually unsubsidizedOption if your income is too high to qualify
for federal financial aidApplication process, show tax returns and
paystubsScholarships!!!!
What seems to be your last option??
WORK AND SAVE!!!!
SO NOW YOU’VE MADE THE RIGHT CHOICES FOR YOU AND ARE READY TO TAKE ON “THE REAL WORLD…”
The Changing Job Market
Job Market – the wide variety of job and career choices that are availableLocal vs. National job marketWhat causes major changes in the job
market?Consider future demand for the job you
are thinking about pursuingWhy do some jobs pay more than
others?Do your research on job trends and
career profiles
Planning Your Career
Job Skills – the specific things you can do, and can do wellHard Skills: Physical human capital,
tangible skillsSoft Skills: Mental human capital,
intangible skillsAptitudes: natural skills, talents, abilitiesInterest inventories: tests that help you
identify what you enjoy doing the mostWhat other “skills” might employers be
looking?
Types of Employment Experience
VolunteerCooperative EducationInternshipsPer diemPart timeFull time
Job Opportunities
What is the FIRST thing YOU should do when started the job search?
Career information sourcesCareer libraries ONET, Occupational
Outlook HandbookMass mediaInternetSchool counselorProfessional OrganizationsNetworking contacts
Job Opportunities cont’d
What sources hand help you find employment opportunities?Job fairsEmployment agenciesVisitNewspapersOnline job search enginesNetworking contacts
You are looking for job descriptions
Good to Know….Update your resume – have it reviewedCreate a cover letterResearch interview questionsResearch the companyDrive to your interview site beforehandPlan a conservative outfitBe 15 minutes early!Leave the cell phone, huge purse and gum
behindImplement good communication skillsFollow-up “thank you” email
Earned IncomeWages – getting paid for every hour workedMinimum wage – lowest pay rate allowed
by law for each hour workedSet by CongressStates can increase
Overtime pay – pay for any hour worked over the set number of regular hoursAt least 1 ½ 40 hour week/holidays
Salary – set pay per month/year
Earned IncomeTips – money given to a person for performing
a serviceSubject to income taxesBased on quality and/or percentage of bill
Commission – a set fee or percentage of a sale paid to a person instead of or in addition to a salaryInconsistent paySubject to income taxesDoes not come without a saleReal estate agents, financial planners,
salesperson, travel agent
Earned Income
Entrepreneur – owner of a businessSelf employmentResponsible for your own income taxesLong hoursIf the business fails, all of your assets are lostWhat is left over after all expenses are paid is
your profitDon’t forget about start-up loans to repayYou typically do not earn a “paycheck”Most of your personal expenses are included
in your business expenses
What Do You Take Home?Gross pay – total amount earned before
deductions are subtractedPay rate x Hours worked = gross payYearly salary = gross pay
Don’t forget about your overtime pay!Net pay – your “take home” pay. The
amount received after all deductions have been made
Deductions – state tax, federal tax, SS tax, Medicare tax, state disability tax, unemployment tax (required) health/life/disability insurance, retirement, your bills, other savings accounts (optional)
Taxes 101Tax deduction: an amount subtracted from Adjusted
Gross Income to lower the amount of tax owed. Home mortgage interest, local property tax payments, contributions to charity, and health or business expenses are the most common.
Tax credit: a direct reduction from the amount of taxes owed (not a deduction from income); tax credits are usually targeted to a policy or objective such as green energy to your home
Taxable income: the amount of income that is taxed after all deductions but before tax credits.
Personal exemption: a dollar amount provided by the federal government (e.g. $3,700 in 2011) that is deducted from income for yourself and each “dependent” such as a child.
Taxes 101
Flat tax: a percentage tax rate that is the same across all levels of income.
Progressive tax: tax rates that increase as income rises.
Marginal tax rate: the rate at which the last (highest) dollar of income is taxed.
Marginal tax bracket: the dollar range in income that corresponds to a marginal tax rate.
Taxes 101Average tax rate: the amount of total
taxes paid/owed divided by total income; this gives a sense of what the average income tax burden for an individual.
Exclusions: dollar amounts of income that are tax-exempt, or not subject to federal income tax. An example would be interest on most U.S. state and municipal bonds.
Tax-deferred income: income to be taxed at a later date, such as interest/earnings from a traditional Individual Retirement Account (IRA).
Sample Pay Stub
Employee BenefitsBenefits: forms of pay other than salary/wagesCafeteria plan: benefit plan that allows workers
to choose form a number of optionsSocial Security: public funds that provide a
degree of financial security to the publicPension plan: retirement plan funded in part by
your employerThree typesFixed income at retirementAnnual contribution by employer that builds up until
you are ready to retire401K – your employer matches up to a certain % of
your contributions
Employee Benefits
Paid holidays: paid for the day, do not work. If you work, you may earn time and a half
Sick leave: covers days the worker is paid if he/she is too ill to go to work
Personal leave: paid time away from work for personal reasons
Maternity leave: paid or unpaid time away from work to take care of a new child
Sabbatical: unpaid leaveNo work no pay scenarios
Other PerksEducational reimbursementHealth/disability/life insuranceHealth flexible spending arrangementsExpense accountTravelCompany car/cellCompany gymBonuses – year-end, holiday, projectsProfit-sharing programs – when company
does well, employees are paid part of that profit
Stock option plans – buying company stock at a reduced price
Unearned IncomeUnearned income: money received from
sources other than working a jobDividend: money earned as a stockholderPension paymentsSS benefitsInterestGambling winningsLotteryPrizesAlimonyAll taxable, but at a lower rate
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