Business and Finance Technology Education Frameworks Personal Finance

Content Standard 1 – Personal Decision Making Apply reliable information and systematic decision making to personal financial decisions. The student will be able to: Beginning Intermediate Advanced Use a rational decision-making Learner Expectation Learner Expectation Learner Expectation process as it applies to the roles of citizens, workers and consumers. *Define and give examples of Examine the impact of advertising, *Analyze the effects of ethics on economic wants and needs. peer pressure and family history business and financial on personal financial decisions. management decisions. Recognize and assume responsibility for the consequences *Differentiate between types of Apply the decision-making of economic choices. decisions and identify those for process to various types of which a formal decision-making decisions at different stages of the Apply the steps in a rational process should be used. life cycle. decision-making process to a situation involving an economic Analyze the effects of leading decision by an individual. economic indicators on a personal financial plan. Apply opportunity costs and trade- offs to personal decision making.

1 *Business, Finance and Technology Assessment Competencies

Revised May 2014 Business and Finance Technology Education Frameworks Personal Finance

Content Standard 2 – Earning and Reporting Income Use a career plan to develop personal income potential. The student will be able to: Beginning Intermediate Advanced Identify various forms of income Learner Expectation Learner Expectations Learner Expectation and analyze factors that affect income as a part of the career Discuss how personal choices *Analyze how career choice, Discuss how income from decision-making process. concerning human capital education and skills affect income employment is affected by (experiences, technology, and goal attainment. factors, such as supply and education/training and other demand, geographic location, factors) influence income. Explain the impact of taxes on level of education, type of personal financial planning. industry, union membership, Analyze the characteristics and productivity, skill level and work requirements of occupations of *Calculate net pay. ethic. interest, including entrepreneurial opportunities. *Identify benefits as a component Analyze the impact of of total income sociological, economic and Differentiate between gross and technological changes on future net income. Discuss how personal choices jobs. concerning human capital (experiences, technology, Compare and contrast education/training and other compensation packages that factors) influence income. include varying levels of wages and benefits.

2 *Business, Finance and Technology Assessment Competencies

Revised May 2014 Business and Finance Technology Education Frameworks Personal Finance

Content Standard 3 –Managing Finances and Budgeting Organize personal finances and use a budget to manage cash flow. The student will be able to: Beginning Intermediate Advanced Develop and evaluate a budget Learner Expectation Learner Expectations Learner Expectation plan. Define fixed and variable *Construct and use a personal Illustrate how income and expenses. budget plan and evaluate it spending patterns change according to short- and long-term throughout the life cycle for the *Categorize and classify expenses goals. typical person and family. as fixed or variable.

3 *Business, Finance and Technology Assessment Competencies

Revised May 2014 Business and Finance Technology Education Frameworks Personal Finance

Content Standard 4 – Saving and Investing Implement a diversified investment strategy that is compatible with personal goals. The student will be able to: Beginning Intermediate Advanced Evaluate savings and investment Learner Expectation Learner Expectation Learner Expectation options to meet short- and long- term goals. Differentiate between saving and Apply criteria for choosing a Examine the fundamental investing. savings or investment instrument workings of the Social Security (e.g., market risk, inflation risk, System and the system’s effects on Distinguish between simple and interest rate risk, liquidity and retirement planning. compound interest. minimum amount needed for investment). Develop financial goals for the Identify the risk/return trade-offs future based on one’s lifestyle for saving and investing. *Explain how and why the stock expectations and career choices.

market works. *Analyze the power of

compounding and the importance Differentiate between interest, of starting early in implementing a dividends and capital gains. plan of saving and investing.

*Explain the role of saving and *Describe the advantages and investing in creating a financial disadvantages of various savings plan. and investing plans.

Calculate and apply the Rule of

72.

*Contrast the impact of simple interest vs. compound interest on savings.

4 *Business, Finance and Technology Assessment Competencies

Revised May 2014 Business and Finance Technology Education Frameworks Personal Finance

Content Standard 5 – Buying Goods and Services Use a rational decision-making process to evaluate factors involved in buying decisions to optimize consumer satisfaction. The student will be able to: Beginning Intermediate Advanced Apply a decision-making model to Learner Expectations Learner Expectation Learner Expectation maximize consumer satisfaction when buying goods and services. Identify laws that protect the rights *Identify the costs of utilities, Compare the costs and benefits of of consumers. services, maintenance and other purchasing, leasing and renting. expenses involved in independent Discuss various ways competition living. Describe consumer assistance among buyers helps the consumer. services provided by public and *Explain how a consumer can private organizations (e.g., Use reliable consumer resources to identify and report fraudulent government, the Better Business collect information for making behavior and practices. Bureau and manufacturers). buying decisions about durable and nondurable goods. Describe the role that supply and demand and market structure play *Describe consumer rights, in determining the availability and responsibilities and remedies and prices of goods and services. give examples of each.

5 *Business, Finance and Technology Assessment Competencies

Revised May 2014 Business and Finance Technology Education Frameworks Personal Finance

Content Standard 6 – Banking and Financial Institutions Banking services are an integral part of managing and organizing financial transactions. The student will be able to: Beginning Intermediate Advanced Evaluate services provided by Learner Expectations Learner Expectation Learner Expectation financial deposit institutions to transfer funds. *Identify the rights and Identify other means of transferring Explain how certain historical responsibilities associated with funds (e.g., money orders and events have influenced the banking using a checking account. certified checks). systems and other financial institutions. Describe the steps involved in *Evaluate products and services and opening and using a checking related costs associated with Examine the use of banks and other account. financial institutions in terms of financial institutions from a global personal banking needs. consumer perspective (e.g., *Differentiate among types of immigrants to the U.S., fear of electronic monetary transactions *Describe and demonstrate the steps banks, cash-based systems in some offered by various financial involved in the bank reconciliation countries, safety of deposits made in institutions. process. banks in other countries).

Compare and contrast the various Identify the functions of the Federal forms of endorsement. Reserve System.

Analyze privacy and security issues associated with financial transactions.

6 *Business, Finance and Technology Assessment Competencies

Revised May 2014 Business and Finance Technology Education Frameworks Personal Finance

Content Standard 7 – Using Credit Maintain credit worthiness, borrow at favorable terms and manage debt. The student will be able to: Beginning Intermediate Advanced Analyze factors that affect the Learner Expectations Learner Expectation Learner Expectation choice of credit, the cost of credit and the legal aspects of using credit. Explain when and why borrowing is Analyze credit card features and *Compare and contrast the various used for the purchase of goods and their impact on personal financial aspects of credit cards (e.g., APR, services. planning. grace period, incentive buying, methods of calculating interest and *Describe the risks and Explain how the amount of fees). responsibilities associated with using principal, the period of the loan and credit. the interest rate affect the amount of Research rights and responsibilities interest charged. of consumers according to credit Identify the opportunity cost of legislation (e.g., truth-in-lending, credit decisions. Analyze various sources and types fair credit reporting, equal credit of credit (e.g., short- and long term) opportunity and fair debt collection). *Identify and explain methods of and related costs. establishing and maintaining a good Compare and contrast the legal credit rating. *Explain credit ratings and credit aspects of different forms of credit reports and describe why they are (e.g., title transfer, responsibility Evaluate the various methods of important to consumers. limits, collateral requirements and financing a purchase. co-signing). Describe the relationship between Define interest as a cost of credit and credit rating and the cost of credit. Describe legal and illegal types of explain why it is charged. credit that carry high interest rates Identify strategies for effective debt (e.g., payday loans, rent-to-buy management. agreements and loan sharking). Analyze the sources of assistance for *Identify specific steps that debt management. consumers can take to minimize their exposure to identity theft.

7 *Business, Finance and Technology Assessment Competencies

Revised May 2014 Content Standard 7 – Using Credit Maintain credit worthiness, borrow at favorable terms and manage debt. The student will be able to: Beginning Intermediate Advanced Describe problems that occur when Identify the components listed on a one is the victim of identity theft. credit report, explain how that information is used, and how it is Identify specific steps that should be received by and reported from the taken by a victim of identity theft. credit reporting agencies.

Explain the implications of bankruptcy.

8 *Business, Finance and Technology Assessment Competencies

Revised May 2014 Business and Finance Technology Education Frameworks Personal Finance

Content Standard 8 – Protecting against risk Use appropriate and cost-effective risk management strategies. The student will be able to: Beginning Intermediate Advanced Analyze choices available to Learner Expectations Learner Expectation Learner Expectation consumers for protection against risk and financial loss. *Identify risk in life and how to *Identify the type of insurance Develop recommended insurance gain protection against the associated with different types of coverage for individuals/families consequences of risk. risk (e.g., automobile, personal and for various risks and different professional liability, home and income levels. Define basic insurance terms (e.g., apartment, health, life, long-term deductible, premium, peril and care and disability). risk). Explain why insurance needs Evaluate insurance as a risk change throughout the life cycle. management strategy. Develop a plan for family financial security (e.g., secure storage of documents, cash reserve, household inventory and medical records retention) in case of a disaster.

9 *Business, Finance and Technology Assessment Competencies

Revised May 2014