Financial Making Decisions

Financial Making Decisions

Vault Module 1

Limited Means

• Can't have everything that you want

• You must decide what you really need to have by using your decision-making skills

Poll

If you were having a birthday party for a friend, which would you buy?

Opportunity Cost

• Give something up in order to get something else

• The cost is what you give up.

• Ex. Giving up going to see a movie to study for a test in order to get a good grade. The cost is not being able to see and enjoy a movie.

Multiple Choice

What would be the opportunity cost of taking a vacation instead of buying a new car because your old car broke down?

• not getting a new car

• going on vacation

Goal

• Something you want to work towards

• Make a plan to achieve your goals

• Short-term and long-term

Short-term Goals

Something you can do in the near future

Long-term Goals

Something you want to do in the future but requires time and planning

Multiple Choice

Buying a house

• long-term goal

• short-term goal

Multiple Choice

Buying a toaster

• long-term goal

• short-term goal

Multiple Choice

Graduating high school

• long-term goal

• short-term goal

Multiple Choice

Completing your science project

• long-term goal

• short-term goal

Needs vs. Wants

• Needs: things that are necessary in order to survive

• Ex. food, shelter, water, clothing for protection

• Wants: things that are not necessary in order to survive. Things that you buy for fun.

• Ex. games, toys, fancy clothes, candy

Multiple Choice

Is this a need or a want?

• need

• want

Multiple Choice

Is this a need or a want?

• need

• want

Multiple Choice

Is this a need or a want?

• need

• want

Multiple Choice

Is this a need or a want?

• need

• want

Prioritize

• Putting things in order in terms of how much they are needed

• If you have limited means you need to prioritize.

• Ex. doing your homework before playing video games

Multiple Choice

Which should be prioritized first?

• Buying ice cream

• Buying bread

• Buying candy

Multiple Choice

Which should be prioritized first?

• Buying new pants because your old pair ripped.

• Buying the newest pair of Nike shoes because they are cool.

• Buying a new cover for your phone.

Final Review

Multiple Choice

If you have limited means, you________.

• have too much money

• can't have everything

Multiple Choice

Why are decision-making skills needed if you have limited means?

• Since you can't have everything, you must decide what you really need.

• Making decisions is possible when you can have everything.

Multiple Choice

Giving up something in order to get something else is called....

• a lost opportunity

• opportunity cost

Multiple Choice

Why does opportunity cost make decision making difficult?

• The costs might be extremely high.

• You must choose to give up some things in order to get other things

Multiple Choice

Setting a goal allows you to...

• achieve nothing

• achieve what you want to do

• achieve everything

Multiple Choice

What happens when you have a goal?

• You can plan out steps to achieve it

• You can always avoid bad decisions

• You can only hope to achieve it