Chapter 10 ( Graduation)

dave and tom and cathy come in and they have a gift for roy for all he has done for them. roy is embarrassed and said it wasn't necessary, and that his reward is seeing their finances in good shape. roy then begins with a lesson about emergency funds. he does not agree with the idea that you need a 6 month emergency fund. roy believes 2-$3000 dollars is sufficient. he says its common sense that if you have a job where you would be more easily laid off then you should have more money set aside in an emergency fund. it also depends on the person how much money you would need. the next topic he brings up is how to save for a child's college education. roy believes some of the responsibility of paying for it should be the child's but alot should also fall on the parent. he also suggest that a prepaid tuition fund is a good idea to lock in a rate. another idea is investing in an education IRA account. HE however sticks by the philosophy to purchase on a monthly basis a well selected equity mutual fund for your child. he also says not to sacrifice retirement for college, that it isn't a good move. he also says a good way to save for college is to get family members to donate. the next topic is disability and health insurance. he tells them medical expenses are a sure way to wipe you out financially and too make sure you have insurance. he also states disability insurance is the one that many people overlook and the statistics are 1/4 that we will need it. His fourth and final topic is about staying informed and that we must always keep up to dat on financial topics. he gives them final words and diplomas

Chapter 9 (Insight Into Investments and Income tax )

dave tells a story of buying new golf clubs and explains how he was being thrifty with his purchase. and realizes after all these years that there is real value to being thrifty. roy tells them about two topics that will be covered investing and income tax. james murray gives a idea that successful investing involves 2 areas one being specialized knowledge and the other an eye for value. the key to the stock market is to buy high and too sell low. and to achieve these two things they remind us that we must have good self discipline. he says in many ways real estate investors always come out ahead. the best investment is too pay of non deductible debt. he also suggests always paying off the highest interest rate debt first. once you get to the point with no debt and have extra money you should spend it. dave thought it was not in his near future to have more money than he cares to spend. now roy goes onto the topic of income tax. he never suggests lowering taxes by tax evasion but only through legal ways. he also suggests getting help from an accountant it certain circumstances. retirement plans and home ownership can help to escape some tax costs while reaching toward a higher financial state. everyone should try filling out there forms themselves and then seek professional advice. he also suggests to read some books to gain additional knowledge.

Chapter 8 ( Saving Savvy)

dave gives the barbershop the exciting news he has had a baby girl named samantha. he also tells them that he has bought a new house. roy tells them for todays agenda it is the topic of proper managing of day to day money. his advice is too develop budgets, avoid credit cards and excersise self control. roy told dave how important it was to make a budget, and too save and never borrow to go on a trip. he also says how we spend our day to day income in the end has little impact on our overall future financial status. he advocates for a budget just with the needs on it. he givesd examples how someones day to day fianances could be bad but in the long run they will be very well off. he tells how people must live within their means. he gives a powerful statement a doller saved is two dollars earned. he also says that to be called thrifty is a compliment. for most people credit cards are not a good deal, they can become a destructive force, many people will buy things with a credit card that they wouldnt pay cah for. credit cards are NOT for the undisciplined, cathy goes on to discuss that debt is the ultimate forced savings plan. and roys final advice is to love within your means.

Chapter 7 ( Home sweet Home)

at the beginning dave is talking about buying a house and roy assures him it will be the best investment he will ever make. and roy proceeds to tell them that todays lesson is on home ownership. he also assures them that renting is not throwing your money away. he tells a story how owning a home can be a great way to gain wealth. he shows how a monthly mortgage payment can be the same as rent therefore a better investment. the tax incentives with homeownership also make it appealing. he also explains how it is a source of pride going home to your own home at night. it is one of the best forced savings plans too. he also explains how in many cases a rent payment may be less than a mortgage payment. Home ownership must work together with the other savings means. he also alerts them to the possibility that real estate can go down in some cases. he suggest buying the worst home in a best area so it can appreciate, and to do minor improvements such as decks that will pay off. he also suggest to have an inspector look at any houses you are interested in. he says it is great to always make the biggest down payment possible which is easier for second tim home buyers. and as far as mortgages go there are many possible ways to pay it off early, and a 15 year mortgage is a better buy than a 30 year. Foreclosures are often another way to get a great deal. They left and he told them next month would be saving spending and credit management.

Chapter 6 ( planning for retirement)

In the beginning they are discussing various things of insurance and wills, but then they get to the lesson which is how to save for retirement. roy says they need to plan for prosperity in the future without having to sacrifice too much in the present. roy assures them that there ten percent fun is for buying the extravagant things and that they will also be able to save properly. he also tells them they will be able to save 10% and save for retirement. he also tells them they wont need as much of an income during retirement because their expenses will be lower. he tells them they must work hard now in order to have a productive retirement. he tells them that is some way the government can be their friend with retirement. social security is a government program to help retirees. but he tells them it should just supplement their retirement plan not BE there retirement plan. he suggest they contact someone at social security office to get information. he says even someone with a good pension plan should still have a separate account to save for retirement. he first tells them of the best known plans: the IRA( individual retirement account). but it has a max of $2000 dollars a year, so it might not always be practical. these are good because they can grow tax free and may be tax deductible. he has advice with IRA's make contributions as early in the year as possible and once you are married add your spouse as a beneficiary on your IRA. he also says to start contributing young to the fund! he also tells them how there are many places to purchase IRA's and to pick the one best for them. another idea is a Keoghs plan which allows far more than $2000 dollars a year. then he goes on to explain the best choice for retirement for most americans is a 401(k) , this in many cases involves employers matching you r contributions to it. the limit on a 401(k) is $9500. he says the 401(k) is the best option for most americans.

Chapter 5 ( wills life insurance and responsibility)

roy tells them how they will be talking about wills and insurance in this lesson. the wills purpose is to make sure that your capital is distributed according to your wishes. An up to date will is a very important thing to have. he says even if you are single you should still have a will. he says not to make a will yourself. you need to seek the advice of a professional in drawing up a will. it can give information about all the estate and also some cases weather or not you would want to be kept alive. choosing an executer of a will is a big choice, and you should make sure you are choosing the right person. make sure to keep a will up to date, and always give a copy to your executor. and make sure to have a list of all your assets with the will. the price for a will is around 2-$300 dollars. the next topic is on to insurance insurance is a very important factor in financial security. many people are very poorly informed when it comes to insurance. if one does not have any dependents than they do not need any life insurance. life insurance must provide money to pay of debts and help with future lump sums such as a funeral and college. inflation must be taken into account with insurance. knowledge is an important part of insurance. term insurance is for a stipulated length of time 5,10, or 20 year terms. it is the most basic and least expensive form. cash value insurance is a combination of term insurance and forced savings plan. roy suggests buying term and investing the difference. it is a much better buy to get term life insurance than cash value. eventually a person can become self insured and not need insurance. roy suggests getting a competitive rate, but it might not always be the lowest rate.

Chapter 4 (the ten percent solution)

roy explained to them how 30 years ago he knew nothing about financial planning either, and after roy talked to mr white he received the secret to help him achieve wealth. there is one big golden rule INVEST TEN PERCENT OF ALL YOU MAKE for long term growth and if you follow that one simple guideline one day you will be rich. roy began to tell them unbelievable stories about how they could invest a little bit every month and in 20 or so years it would be worth millions of dollars. it is all due to compound interest. roy explains you don't have to squirrel away every cent but you must save some to accomplish your financial goals. a vary important saying is pay yourself. once you begin putting away 10% you wont even miss it after a while. to achieve higher interest rates over time we must be owners not loaners. roy warns them not to buy common stocks with their 10% savings. there are very few people who become rich by buying and selling stocks. many people can loose money rapidly in the stock market and it is not the way to go for long term wealth.roy emphasizes the importance of having a good long term track record. buying mutual funds is very simple and can be done straight through your bank. an interesting statistic is that 90% of the worlds millionaires have become rich through real estate. and real estate is all a matter of timing. so by saving 10% of your pay currently you practically guarantee yourself financial freedom later in life.