Rebecca Dean Reid Ross Classical High School

ECONOMIC A

CTIVIT

IES

PE

RS

ON

AL F

I NA

NC

E

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FOUR E

CONOMIC A

CTIVIT

IES

Achie

ve F

inan

cial

Sec

urity

and p

erso

nal s

atis

fact

ion b

y

being re

spon

sible

with

…

Earning

Spending

Saving

Investing

CareerChoices

Ability to Find

Employment

Ability to

Advance

Earnings

Standard of Living

Earning is gaining money by working, owning a business, or receiving investment returns. Money gained from earning is called earnings.

Career Choices • Type of career/job

• Place of employment

FACTORS AFFECTING EARNINGS

Ability to Find Employment

• Education level• Employability

skills• Prior job

performance• Economic

conditions• Workplace trends

and opportunities

FACTORS AFFECTING EARNINGS

• Type of career/job

• Education level• Job performance• Economic

conditions• Workplace

trends and opportunities

Ability to Advance

FACTORS INFLUENCING EARNINGS

EARNINGS AFFECT YOUR STANDARD OF LIVING!

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RESPO

NSIBLE

EARNIN

G

involves realizing that career choices greatly affect lifetime earnings and standard of living. Responsible earning considers these factors when making career choices.

SPENDING…

using money to purchase goods and services. The way a person spends money determines the value received and influences the economy.

Each purchase contributes to the demand for the product or service purchased.

LAW OF SCARCITY:

An economic system cannot produce all goods and services that consumers want, and most consumers do not have the resources to purchase everything they want. Choices must be made about how limited resources (time, money) are used.

TRADE-OFFS AND OPPORTUNITY COSTS

When making a choice, other alternatives must be sacrificed.

The highest-valued alternative that must be given up when a choice is made is the opportunity cost of the choice.

The choice of one item while giving up another is called a trade-off.

RESPONSIB

LE S

PENDIN

G

includes researching and planning purchases in advance and making wise choices in light of opportunity costs and trade-offs that apply.

SAVING…

putting aside money for later use.

Money may be “saved” in a bank account or in a wallet.

The form of savings used determines the financial return.

“LATER USES” FOR SAVINGS

Emergencies Recurring expenses Future purchases Financial goals Retirement

BENEFITS OF SAVING

Provide money for future purchases

Can be used to earn income

Produce a healthy economy

Increase personal financial security

Provide growth opportunities for business ventures

RESPONSIB

LE S

AVIN

G

means forming the habit of saving regularly and finding forms ofsaving that yield high returns.

BORROWING

obtaining money, goods, or services at present in exchange for the promise of future payment . . . “Buy now, pay later.”

BORROWING = “BUYING ON CREDIT”

Borrowing means spending future income and includes buying on credit.

Having “good credit” depends on one’s willingness and ability to pay back what is owed when it is due.

Credit purchases are more costly than cash purchases if not paid back quickly.

The wise use of credit can help some individuals raise their standard of living by extending their buying power.

EXAMPLES OF BORROWING

Buying with a credit card

Buying on installment

Payday loans

Cash advances

Layaway purchases

REASONS FOR BORROWING

Major purchases

Emergencies

Convenience

Prepare for future goals

Take advantage of good sales/offers

RESPO

NSIBLE

BORROW

ING

means borrowing only what can be paid back when due.