One of the most important lessons in economics is learning the importance of managing

your personal finances. Understanding the importance of credit scores, the ability to avoid economic scams, opportunity costs of decisions, and how to create and hold to a personal budget are critical life lessons. In this project, you will research and make decisions about your personal finances, while incorporating the information we have learned this semester. You will create a presentation as a final product that incorporates the following topics. The portfolio pages should be should be as visually appealing as possible – include charts, graphs, and pictures to enhance your presentation. Each section should be clearly divided.

You will need to keep track of where you gathered the information in a bibliography. Be

sure to note the location where you received any outside information (and a copy of it if

possible). All information used must be REAL information gained from research, not made up information. Be sure to cite all sources

Also, use terminology learned in this course, with the correct definition, where

appropriate. If a term appears in the section, it must be included. All terms will appear in italics.

Scenario:

You have graduated college (or other post-graduation plans), and will now enter “the real world.” Please complete the following (again, using real information) – each in a separate section in your portfolio:

1. Economic Biography: The first section should be an economic biography of

you, including the human capital you have attained (education, job experience, etc.)

Include the following in this section:

i. Where you plan go to school?

ii. What degree will you earn?

iii. What is the job outlook for your degree (what is the likelihood of getting?

Hired in the future)?

iv. What is the opportunity cost of getting your degree? (Or if no degree, the

cost of not getting a degree.) Actually use real numbers here – what would

you have been earning instead of going to college?

2. College financing: How much did your training / degree cost? How was it

financed? Be specific. You will need to talk to your parents to answer some of

these questions. Include the following in this section:

i. How much is the total cost of your degree? Include tuition, room, board,

etc.

ii. What is the opportunity cost of this choice – be specific, calculating how

much you could have earned instead of going to school.

iii. REGARDLESS of your college financing, complete the following:

Using the total cost of college, including tuition and room and board,

calculate how much a student loan would cost to cover this amount.

Include interest rates, how long it would take to pay off, and what the

monthly payments would be.

iv. IF your parents are financing your college (or it is financed by college

scholarships), discuss the opportunity benefit you receive if from this

outside financing – what options are now available to you that you would

not have if you had to finance your own degree?

v. If you are paying for student loans, be sure to include this in your final

budget.

3. Job: Describe the entry-level job you are seeking and/or have obtained. Include

relevant information regarding benefits received, salary, and hours involved. Use

REAL examples of jobs in this industry to gather your information, in the area of

the nation you wish to live. If possible, gain this through an interview. Use real

examples of jobs available. If you cannot find a specific salary range, then use a

site that gives a range and use the salary at the lowest end of the range. Document

all information. Include the following in this section:

i. Job description and location

ii. Salary (document where you received this information – should be entrylevel

salary, so you cannot use a salary from a job that needs years of

experience)

iii. Benefits received – description (If you didn’t find a specific job, include

the average benefits received.)

4. Home: You need to find a place to live in the area of the country where your job

will be located. Find a REAL example of housing in which you would be willing

to live. (Include pictures if possible.) Explain why you chose this option. Include

all relevant amenities. (Apartments do not come furnished. If it says the option is

available, it is not part of the price quoted.) Include the monthly rent (if a house,

include the mortgage type and mortgage payment – don’t forget to add in taxes

and insurance). Include in this section:

  • Type and location of apartment / home
  • Rent or mortgage payment per month
  • Amenities included in the rent (just because it says it is available does

not mean it is included)

  • Pictures
  • Insurance costs

6. One-time Costs: Find out how much money you will need to pay up front for

your apartment. Set aside a budget to furnish your apartment – use some real

examples of prices for bedrooms, kitchen, living room furniture. What is your

security deposit? First payment on apartment/home? (usually first and last)

Include in this section:

  • First payment (usually first/last month’s rent)
  • Security deposit
  • Cost of basic furniture and dishes (bedroom, kitchen, living room)
  • Include pictures / website info

7. Monthly Costs: Find out how much utilities, insurance, etc. will cost per month.

Don’t forget all of the utilities: cable, internet, cell phone, gas, electric, water,

heat, trash. Note: Just because an apartment states that it has high-speed internet

does not mean it is free. You need to find out exactly what is included in the rent.

Cable

Internet

Cell phone

Land line

Electricity

Gas (Natural)

8. Transportation: What type of vehicle will you have? What kind of down

payment did you have to pay? What are the payments? Include calculations of the

loan amount and interest rates. What is the amount of the insurance? Parking

costs? Gasoline costs? If you choose public transportation, research those costs

and explain how this would affect your mobility. Use real numbers.

Type of vehicle (if applicable)

1. Financing

2. Loan amount

3. Down payment

4. Monthly payment

  • Maintenance costs (must set this aside)

Try this site:

for-car-maintenance/

  • Parking costs (home / work, if any)
  • Estimate gas cost per month based on how much you think you will

drive. Use distance from home to work as a guide.

  • Type / cost of public transportation (if applicable)

1. How does this affect your mobility?

2. How far is this from your home?

9. Choose a banking institution: Compare at least two banks and one credit union,

using at least four different criteria. Introduce the section with a summary of your

decision. Complete the decision matrix

10. Credit Cards: Compare a Visa/Mastercard, Discover Card, and American

Express. Use at least four criteria for your decision card. Introduce the section with a summary ofyour decision. Also, include a discussion of the dangers of credit cards. If youchoose not to have any credit cards, you need to explain why you made this choice

  • Explain the drawbacks of not having a credit card.

12. Credit Score: What is a credit score? Explain how credit scores are calculated

and why they are important. Include:

  • Definition
  • Explanation of the things they monitor to determine your score
  • How can you keep track of your credit score?
  • What are the three credit reporting agencies?
  • What do you do if there is an incorrect entry?
  • How can you keep your credit score high?

13. Economic Climate: If you were entering this job market today, describe the

economic climate in which you would be entering. (Describe today’s economy

generally.) Use statistics in your description. Include:

  • GDP statistics
  • Unemployment statistics (US & where you plan on getting a job)
  • Inflation statistics
  • Consumer confidence
  • Future predictions

14. The Budget: First, generally describe your budget choices, including what you

will do if you have any money left over. Then, use the final budget worksheet on

Mr Jackson’s website to organize a final monthly budget. Fill in the spreadsheet

with the information you have researched (change the worksheet as necessary).

You may need to adjust your spending based on your budget. Include:

  • Overall description of your monthly spending and why.
  • Budget worksheet completed with the numbers you researched.

15. Summary ( 1 page): What did you learn from this project? How did the things we learnedin class this semester apply to this “real life” simulation? What things surprised

you, if any?