1.17.2.g1 bellwork list 3 things you have needed in the past week. list 3 things you have wanted in...

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Bellwork

• List 3 things you have needed in the past week.

• List 3 things you have wanted in the past week.

• Did you get the things you needed and why?• Did you get the things you wanted and why?

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Financial Decisions

“Take Charge of Your Finances” Advanced Level

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© Family Economics & Financial Education –May 2012 – Financial Decisions – Slide 3Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

What contributes to the decisions you make?

Values

Needs

Wants

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© Family Economics & Financial Education –May 2012 – Financial Decisions – Slide 4Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

What is a Value?

Value - a fundamental belief or practice about what is desirable, worthwhile, and

important to an individual

What do you value?

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© Family Economics & Financial Education –May 2012 – Financial Decisions – Slide 5Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

Everyone has different values

Family

Financial Security

?

Education

Helping others

Honesty

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© Family Economics & Financial Education –May 2012 – Financial Decisions – Slide 6Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

What influences your values?

Family Friends/Peers Teachers

Culture Media ?

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© Family Economics & Financial Education –May 2012 – Financial Decisions – Slide 7Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

Needs and Wants

Needs – something thought to be a

necessity or essential items required for life

Wants– something unnecessary but desired or items which increase quality of living

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© Family Economics & Financial Education –May 2012 – Financial Decisions – Slide 8Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

What are your needs and wants?

Move towards the arrow indicating whether you feel each item is a need or a want

Needs Wants

Perception of needs versus wants is dependent on personal values

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© Family Economics & Financial Education –May 2012 – Financial Decisions – Slide 9Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

• Brand new clothing• A daily soda or coffee

beverage• A personal automobile• Downloading music• A refrigerator• At least three meals per day• Shoes• Watching or participating in

athletic activities• A computer• A warm and safe place to live• A television

What are your needs and wants?

Needs Wants

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© Family Economics & Financial Education –May 2012 – Financial Decisions – Slide 10Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

Why do needs and wants matter?

Will help you decide what to spend and not spend your money on

Trade-off - giving up one thing for

another

Opportunity cost - the value of the

next best alternative that must be forgone when making a

decision

Use trade-offs and opportunity costs to help you

make these decisions

Is the trade-off to your decision a need or a want? What is the value (opportunity cost) of that trade-off to you?

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© Family Economics & Financial Education –May 2012 – Financial Decisions – Slide 11Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

Shelbi’s Decisions

Help Shelbi identify her trade-offs and opportunity costs

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© Family Economics & Financial Education –May 2012 – Financial Decisions – Slide 12Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

Summary

Analyzing trade-offs and opportunity cost

will help you determine which decisions to make

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© Family Economics & Financial Education –May 2012 – Financial Decisions – Slide 13Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

Why is it important to understand what influences your decisions?

Understanding what influences

your financial decisions

Decisions that create high

well-being

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© Family Economics & Financial Education –May 2012 – Financial Decisions – Slide 14Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

Needs, Wants, and Cupcakes

Icing and decorations represent wants, the extra items that make our lives interesting and enjoyable.

The cake part of a cupcake represents our needs. They must be present and addressed before considering any icing or decorations (wants).

When making spending decisions, consider if your needs are met before spending on any of your wants. What you determine to be a need versus a want will depend on your personal values, just like your preference for different types of cupcakes.