“Don’t worry that children never listen to you; worry that they are always watching you.” –...

“Don’t worry that children never listen to you; worry that they are always watching you.”

– Robert Fulghum

Shawn B. YoungNHSA Parent ConferenceDecember 9th -13th 2011

What do you want to get out of this class?

Most Common Reasons1. Want to “stick to a budget”

2. Want to “save”

3. Want to improve their credit

4. Want to be less stressed about money

Why People Learn1. Repetition (ex. ABCs, 123s)

2. Applicability (ex. Driving)

3. Interest (ex. Favorite movie quotes)

Bootstraps and Head Start

Short-Term Stress Can Affect Learning and Memory

•It has been known that severe stress lasting weeks or months can impair cell communication in the brain’s learning and memory region…

•A new study shows that short-term stress lasting as little as a few hours can impair brain-cell communication as well.

ScienceDaily (Mar. 11. 2008)

Rule #8: Stressed brains don’t learn the same way.

•Your brain is built to deal with stress that lasts about 30 seconds. The brain is not designed for long term stress when you feel like you have no control.

•Stress damages virtually ever kind of cognition that exists. (Memory and executive function, motor skills, immune response, ability to sleep)

John Medina, Brain Rules

Rule #8: Stressed brains don’t learn the same way.

•You have one brain.

•The same brain you have at home is the same brain you have at work or school.

•The stress you are experiencing at home will affect your performance at work, and vice versa.

John Medina, Brain Rules

Money Main Cause of Stress in Americans

•“Most Americans say that money is their primary source of stress, according to a survey by the American Psychological Association.

•The APA found that 75% of Americans consider money their biggest stressor…”

ABC News Radio, 2011

What is Money?1.

2.

3.

4.

5.

6.

7.

What is Money?•Money is simply a tool

What is Credit?1.

2.

3.

4.

5.

6.

7.

What is Credit?•Credit is trust

Available credit

Promise to pay later

What is an Asset?1.

2.

3.

4.

5.

6.

7.

What is an Asset?•An asset is simply something of value to

you

Tangible

Intangible

house

car family

health

1.

1. Azoreg

Asset Building Continuum

Asset Building ContinuumTime

Time

What is a Personal Value?1.

2.

3.

4.

5.

6.

7.

What is a Personal Value?•“Ideals by which you live your life.”

Affection

Growth

Community

1.

1. Frank Wouters

1.

Your Personal Values• Please circle your top ten Values from the

list Achievement Advancement/Promotion Adventure

Affection (love & caring) Arts Problem solving

Change & Variety Relationships Community

Compassion Cooperation Competition

Country Creativity Decisiveness

Democracy Faith Economic Security

Education Effectiveness Efficiency

Ethical practice Excellence Excitement

Fame Financial Gain Friendships

Growth Family Fun

Helping others Public service Health

Independence Influence Harmony

Peace Integrity Intellectual Status

Job security Knowledge Leadership

Location Loyalty Meaningful work

Money Nature Honesty

Personal Development Freedom Physical Challenge

Pleasure Power Authority

Privacy Recognition Religion

Reputation Responsibility Security

Self-Respect Serenity Stability

Status Time Truth

Wealth Wisdom Acceptance

Balance Cleanliness Courage

Commitment Dedication Humor

Consideration Joy Mercy

Fairness Tolerance Patience

Selflessness Flexibility Forgiveness

Kindness Convenience Control

Sobriety Spirituality

Personal Values•List your top five personal values in no

specific order

Personal ValuesTop Five Values

1.

2.

3.

4.

5.

Top Five Values

1.

2.

3.

4.

5.

Are Values Fluid?• Then vs. Now

EducationFunFreedomKindnessCourage

Family Job

Security Health Patience Influence

Personal Behavior•List one personal behavior that supports

each of your above listed values

Personal Value: Health

Personal Behavior: I exercise 3 times a week

Personal Behavior•List one personal behavior that

contradicts each of your above listed values

Personal Value: Health

Personal Behavior: I ate a dozen donuts this morning

WHY ARE WE TALKING ABOUT VALUES?

DESIRED RESULT

BEHAVIORPERSONAL VALUE

Personal Priorities•If you lost your income, what would your

priorities be?List of expenses Your Priorities

Savings

Food/Nutrition

Housing

Medical

Transportation

Health Insurance

Car Insurance

Life Insurance

Clothing

Household Items

Convenience Foods

Entertainment

Other insurance

Grooming & Hygiene

ElectricityWater

Gas

CableInternet

Phone

Taxes

Tithing

Donations

Miscellaneous

Debt

Childcare

Pet Care

Restitution

Education

Child Support

Personal Priorities•What are your top five personal priorities?

Top Five Priorities

1.

2.

3.

4.

5.

Top Five Priorities

1.

2.

3.

4.

5.

Wants and Needs•Make a list of your current wants and

needsWant

1.

2.

3.

4.

5.

Need

1.

2.

3.

4.

5.

What is a Need?1.

2.

3.

4.

5.

6.

7.

Wants and Needs•How do you determine what your wants

and needs are?

•What are some influences on determining your wants and needs?

Wants and Needs•What is a need?

Wants and Needs•How do you determine what your wants

and needs are?

“I want a new car.”

“I need a new car.”

Wants and Needs•When a “want” turns into a “need” it adds

stress

“I want new shoes.” “I need new shoes.”

+ stress

The Message in Our Head•Video: Stephen Colbert

The Message in Our Head•Marketing:

•Advertising:

All strategies used to get you to willfully give up your money

One strategy used to get you to willfully give up your money

The Message in Our Head•How much is spent on marketing per

year?

$4 000, 00 0, 000•and they intend to get their money back

0,0

The Message in Our Head•“By the time we reach the age of sixty-six, most of us will have seen

approximately two million television

commercials. Time-wise, that’s the

equivalent of watching eight hours of

ads seven days a week for six straight years.” (Buy-ology, p. 37)

Message in Our Head•Create a want where none existed

•Turn a want into a need

“You know, those shoes are pretty nice, I want them.”

“Those shoes are so nice, I need them for this weekend.”

Message in Our Head• Big Pharma Spends More on Advertising Than

Research and Development

• Estimates are as high as $10 billion spent on advertising all types of food and beverages to America’s children and youth. (Only 5% are for healthy foods/beverages such as dairy products and fruit juice. None are for fruits and vegetables.)

• Kids in the United States see 40,000 commercials each year

3. American Academy of Pediatrics

2. Colorado State University

1. Science Daily, York University

Message in Our Head•Under the age of 8, most kids don’t

understand that commercials are for selling a product.

•Under the age of 6, unable to distinguish program content from commercials.

* American Academy of Pediatrics

Neuromarketing•“…Our irrational minds, flooded with

cultural biases rooted in our tradition, upbringing, and a whole lot of other subconscious factors assert a powerful but hidden influence over the choices we make.” Martin Lindstrom in his book “Buy-ology ”

Neuromarketing•Marketing to the subconscious

Example: At the grocery store

Neuromarketing•Video: Product Placement

The Impact

Personal Values & Self Image

Thought

or Behavior that is not in alignment with Personal Values

Cognitive Dissonance

Cognitive

Dissonance

Justification

Rationalizati

onDenialBlame

Self Imag

e Relief

DESIRED RESULT

BEHAVIOR

PERSONAL VALUE

JustificationRationalizati

onDenialBlame

80% OF SPOUSES LIE ABOUT SPENDING

* Chris Friedrich

Break Time!

“Mother Nature, in her infinite wisdom, has instilled within each of us a powerful biological

instinct to reproduce; this is her way of assuring that the human race, come what may, will never

have any disposable income.” –Dave Barry

What is Income?1.

2.

3.

4.

5.

6.

7.

Income is…• All the resources that an individual

receives.Paycheck Energy

Assistance

FoodAssistance

$20 from Family Member

Income• What is the difference between gross and

net income?

Income• Gross Income: Money before taxes,

deductions and benefits are taken out.

• Net Income: Final amount of money after taxes, deductions and benefits are taken out.

Income• There is a value attached to the taxes,

deductions and benefits that are taken out of your gross income.

Gross Income Value Net Income

Taxes• Taxes are payments made to federal,

state and local governments in return for government provided services.

Taxes• Examples of services provided:

Head Start Police and fire departmentsWater and sewage infrastructuresHighway construction and maintenance HospitalsPublic education

Benefits and Deductions Health Insurance401(k)Stock OptionsFlexible Spending AccountsExpense Accounts

•If our gross income is $1,000, how much can we afford to spend?

•What is it called if we spend (our expenses) more than we make (our income)?

Income

Debt•How is it even possible to spend (our

expenses) more than you make (our income)?

Debt•What are some of the major causes of

debt? Credit CardsMortgagesCar LoansHealth CostsStudent Loans

Consumer Debt•As of September 2011 Americans

amassed

$2, 000, 00 0, 0002,5in personal consumer debt*

*Federal Reserve

4

Consumer Debt•Amount of credit card debt:

$749,100,000,000

*Federal Reserve

Consumer Debt•609.8 million credit cards in US

•Average credit card debt per household with credit card: $15,799

•Average APR on credit card with balance on it: 13.10% as of May 2011

*Federal Reserve

Consumer Debt•Amount of student loan debt:

$958,402,279,543

*Fastweb and FinAid

Consumer Debt•The amount of student loans taken out in

2010 was over $100 billion.

• For the first time ever total loans outstanding will exceed $1 trillion this year.

*Federal Reserve*US Department of Education

Consumer Debt•The amount of mortgage debt: $10,300,000,ooo,ooo

*Bureau of Economic Analysis

In Summary•Marketers spent:

•Consumer’s DEBT:

$400,000,000,000.00

$2,452,000,000,000.00

US National Debt• The outstanding Public Debt as of November 21st

2011:

$15,054,572,978,153.34

•The National Debt has continued to increase an average of $3.99 billion per day since 2007

*National Debt Clock

US National Debt•The estimated population of the US is 311,713,697 so each citizen’s share of this debt is $48,296.15

• Number of US Income Taxpayers is 112,583,135 making the share of debt rise to $133,719.61

*US Census*National Debt Clock

That’s a serious amount of debt…

Financial Stress•Video: Stress

Financial Stress•Finances play one of the biggest roles in a

person’s day-to-day stress.

•Stress, as it turns out, is one of the biggest factors in a person’s health.

•And health is one of the largest burdens on personal finances!

Money Main Cause of Stress in Americans

•“Most Americans say that money is their primary source of stress, according to a survey by the American Psychological Association.

•The APA found that 75% of Americans consider money their biggest stressor…”

ABC News Radio, 2011

Divorce

•A 2009 study found that couples who reported disagreeing about finances once a week were over 30% more likely to get a divorce than couples who reported disagreeing about finances a few times a month.

Jeffery Dew, Utah State University

Domestic Violence

•“An abuser will often restrict a victim’s outlets, forbidding the victim to maintain outside employment, friends or family ties.

•Abusers also limit a survivor's options by not allowing access to checking accounts, credit cards or other sources of money or financial independence.”

The National Center for Victims of Crime

Domestic Violence

•The survey polled 672 domestic violence shelters across the US. The top attributers to the rise in abuse were:

73% financial issues48% job loss62% stress

Mary Kay Truth About Abuse Survey 2011

Financial Stress• Unhealthy Coping Behaviors

• Less Money for Self-Care

• Lost Sleep

• Unhealthy Emotions

Acute vs. Chronic Stress• Acute Stress: is experienced in response

to an immediate perceived threat, either physical, emotional or psychological.

Stress and the Body• Stress causes the body to release the

hormones Adrenaline and Cortisol and other stress related hormones.

Stress and the Body• Increased levels of Cortisol, Adrenaline

and other hormones produce:

An increased heart rateQuickened breathing rateHigher blood pressure

Acute vs. Chronic Stress• Chronic Stress: is a state of ongoing

physiological arousal.

• Over time this can wear down our bodies and cause us to become ill, either physically or emotionally.

• We were built to handle acute stress, not chronic stress.

Stress and the Body• The CDC estimates that 80% of all

medical expenditures are stress-related.

Study Links Medical Costs and Personal Bankruptcy

•“Harvard researchers say 62% of all personal bankruptcies in the U.S. in 2007 were caused by health problems – and 78% of those filers had insurance.”

Bloomberg Businessweek, 7-4-09

Spending and Stress• Researchers say that it takes as little as

2.5 seconds to make a purchasing decision.

•“When we first decide to buy something, the brain cells that release dopamine secrete a burst of good feeling and this dopamine rush fuels our instinct to keep shopping even when our rational minds tell us we’ve had enough.” *Michael Lindstrom

*Moneywise, 2010

Short vs. Long Term

Short Term

Long Term

dopamine

cortisol

Stress• What is stress?

1.

2.

3.

4.

5.

6.

Stress• What causes stress?

1.

2.

3.

4.

5.

6.

How Stress is Defined and Measured:• Aroused physiological response to stress

• Stressor must be “perceived” as aversive

• Person must not feel in control of stressor

*John Medina

Stress• Is the physical and psychological product

of not accepting the perceived current situation or moment as it is.

Stress• How can a realistic picture and

understanding of money and finances help alleviate stress?

“The biggest part of successful stress management involves

getting control back into your life.”

* John Medina

Opportunity Cost• What is opportunity cost?

Opportunity Cost

The $15 spent on pizza can no longer be used for credit card bill

• Example:

Opportunity Cost

$15 Loss of payment

Late charges

Interest feespizza

Asset Building ContinuumTime

Time

Time• What is time value?

Time• “Time Value” means how much time it

takes to accumulate money.

Time Value

$500 $10 50 hours

• Example: You make $10/hour and rent costs $500

Exercise• Apply the concept of “time value” to one

of your expenses.

Time Value• “Time Value” can also include the

opportunity cost of the things you are giving up.

• Example: In order to earn more income you are giving up time spent with your family.

Making Change•“If we keep doing the same thing we’ve

always done, we can expect to get the same things we’ve always got.”

•Definition of Insanity: doing the same thing over and over and expecting different results.

Stages of Change1. Pre-contemplation

2. Contemplation

3. Planning (Learning)

4. Action

5. Maintenance

6. Relapse

Credit and Risk Management

Savings• What does it mean to save?

Savings is…• An increase in resources kept through

time

Consumption is…• The usage of resources

Dissaving is…• the consumption of assets!

Financial Management • Video: SNL

“Control is a powerful influence on the perception of stress.”

* John Medina

The Spending Momenttm

“The Spending Moment”•Your actions will reflect exactly what your

values are in that particular moment

= Fun = Cleanliness

“The Spending Moment”•Requiring yourself to ask for a receipt will

make you aware in that moment that you are willfully allowing money to leave your possession

The money isn’t getting up and walking away by itself

“The Spending Moment”•Once you are conscious of your spending,

you can begin to determine if your spending is in alignment with your values.

•Once you are conscious of your spending, you can begin to modify that behavior.

Budget• What is a budget?

1.

2.

3.

4.

5.

6.

Budget• A budget is simply a plan.

• Plans are important in pursuing goals. May Budget

Rent $475Electricity $30Utilities $45Car Insurance $120Health Insurance $150Cell Phone $50Internet $30Groceries $350

ToolsEnvelope

Spending JournalDATE ITEM or PAYMENT METHOD

06/01 RentSoda @ convenience store

$350$.79

Check, Credit CardCash, Money Order

Income and Time Value

Income Source

Gross

(Total amount)

Taxes, Insurance & Benefits

Net

(Gross minus taxes, etc.)T.V.

1.

2.

3.

Expenses and Time ValueExpenses Expected Actual Difference T.V.

Savings/Investments

Food

Housing

Medical

Transportation

Health Insurance

Car Insurance

Life Insurance

Clothing

Household Items

Convenience Foods

Entertainment

Other insurance

Grooming/Hygiene

Electricity

Water

Gas

Cable

Internet

Phone

Taxes

Tithing

Donations

Debt

Childcare

Pet care

Child Support

Restitution

BudgetIncome Source

Gross(Total amount)

Taxes, Insurance & Benefits Net(Gross minus taxes, etc.) T.V.

1.

2.

3.

Expenses Expected Actual Difference T.V.

Savings/Investments

Food

Housing

Medical

Transportation

Health Insurance

Car Insurance

Life Insurance

Clothing

Household Items

Convenience Foods

Entertainment

Other insurance

Grooming/Hygiene

Electricity

Water

Gas

Cable

Internet

Phone

Taxes

Tithing

Donations

Debt

Childcare

Pet care

Child Support

Restitution

Stay Connected •Bootstraps website:

www.bootstrapseducation.org Shawn’s Blog Schedule of courses For Graduates page

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To sign up email: abeckord@bootstrapseducation.org

Improving your financial position will come from the

creation and maintenance of ASSETS and not merely and

increase in income.

Financial Stress•Finances play one of the biggest roles in a

person’s day-to-day stress.

•Stress, as it turns out, is one of the biggest factors in a person’s health.

•And health is one of the largest burdens on personal finances!

Bootstraps, Head Start and You

Any questions or comments?