Get Smart with Money

1. Getting Money Smart

7. x Chessboard of Financial Life .01

8. .02 .08 .32 1.28 x Chessboard of Financial Life .04 .16 .64 .01

9. Chessboard of Financial Life 5.12 20.48 81.92 327.66 .02 .08 .32 1.28 x 2.56 163.84 40.96 10.24

10. 40.96 .02 .08 .32 1.28 x Chessboard of Financial Life 20,971.52 5,242.88 1,310.72 10.7M $ 85M 41,943.04 2.56 163.84 40.96 10.24

12. Rule of 72 (72 ÷ Interest Rate = Yrs) Passbook Savings 3 % 24 Money Market 6 12 U.S. Treasury Bond 7 10 Stock Market 10 7 Potential Interest Years Investment Rate Double This exercise is for illustration purposes only. It does not take into consideration fees, taxes, commissions, etc. and does not represent any specific product or investment.

14. How To Really Be A Millionaire

16. True or False? About 2 / 3 of millionaires work 45-55 hours a week False False False Most millionaires work fewer than 40 hours a week 2

17. True or False? Only 19% of millionaires received any income from a trust fund or estate False False False Most millionaires received financial help from their families - like inheriting a trust fund or estate 3

18. True or False? Wealth builders view such funds as having the same potential for saving as any other money. False False False 4 Gift money, tax refunds, earnings from winnings are found money.”

19. True or False? 28.6% of millionaires have American Express Gold Cards 43% have Sears cards. More millionaires have American Express Gold Cards than Sears Cards. False False False 5

20. True or False? Ford is preferred by 9.4% of millionaires Cadillac is preferred by 8.8% Only 23% of millionaires drive a new car False False False More millionaires drive Cadillacs than Fords 6

21. True or False? Most millionaires work in ordinary jobs including: welding contractors, owners of mobile-home parks & paving contractors False False False Most millionaires work in glamorous jobs, such as sports, entertainment, or high tech 7

22. True or False? Wealth builders always keep 2 to 3 credit cards to allow for a large line of credit for use in emergencies Many keep only one credit card for renting cars, guaranteeing hotel rooms, etc. Most pay off the monthly balance each month False False False 8

23. True or False? The chances of winning the lottery are 1 in 12 million and as high as 1 in 120 million. Many poor people become millionaires by winning the lottery False False False 9

24. True or False? In recent years, the average college graduate earned 66% more than the average high school graduate False False False College graduates earn about 33% more than high school graduates 10

25. True or False? Most millionaires are self employed and consider themselves to be entrepreneurs . Most others are professionals, such as doctors , lawyers and accountants False False False Most millionaires work for large, Fortune 500 Companies 11

26. True or False? Recent studies show that 80% of people who try to earn money as “day traders” lose money False False False People who play the stock market usually beat it and many of them become millionaires. 12

27. True or False? Nearly 95% of millionaires own stocks. Since 1926, stocks have increased 10% at a compounded annual rate of return. False False False If you want to be a millionaire, avoid the risky stock market. 13

28. True or False? Hypothetical example. This example does not take into consideration fees, taxes, commissions, etc. and does not represent any specific product or investment. The earlier you begin saving, the better . Regular saving may make you a millionaire even if your income is modest. True True True If you save $2,000 a year from age 22 to age 65 at 8% interest, your savings will be over $700,000 at age 65. 14

29. True or False? Questions 1-15: Belsky & Gilovich. Why Smart People Make Big Money Mistakes . Simon & Schuster, 1999. Lee & McKenzie. Getting Rich in America . HarperBusiness, 1999. Stanley & Danko. The Millionaire Next Door. Longstreet Press, 1996. Most millionaires are married and stay married. Divorce can be costly. False False False Most millionaires are single 15

31. Solving the mysteries of finance and economics Does This Make Cents?

35. Does This Make Cents? Why are we so quick to spend gift money we receive? “ Because I got it free . They gave me a gift and I turned it into a thing.” Our minds play a trick. Gift money doesn’t seem as valuable as money we worked for. But ask yourself, if you didn’t have to work for it, why isn’t it easier to save it? But remember . . . Gift money can grow as shown by the Rule of 72. ? ? ?

38. TheMint.org