Chapter 2

HABITS FOR IMPROVED FINANCIAL SUCCESS

Posted on May 9, 2026 by Melissa Hart

The Bottom of Formdifference between wealth and financial struggles is often the result of knowing and using some simple money habits, these include:

  1. Focus on assets not consumption. Purchase items that will generate cash inflows or will increase in value over time. Buy businesses, real estate, and stock investments that create income rather than new cars, bigger homes, and other items that require monthly debt payments.
  2. Avoid paycheck-to-paycheck thinking. Plan investments that will produce future income streams and increased value. If your main emphasis is on living within your budget, you are minimizing opportunities for wealth accumulation.
  3. Practice delayed gratification. Postpone spending (driving an older car and not buying luxury items) to have funds to take advantage of investment compounding and wealth growth.
  4. Strategic use of credit. Borrow at low rates to invest in assets that will generate higher returns. Intelligent debt use can quicken wealth building. Too often, a person uses debt to buy items that depreciate.
  5. Calculated risk for enhanced returns. Don’t avoid risk, manage it. Understand that risk with a limited downside along with a greater potential upside creates wealth. Fear keeps savings in low-yield accounts while missing out on greater compounding opportunities.
  6. Develop tax awareness. Plan your income and investments based on tax considerations. Knowledge of tax provisions can result in an efficiency that enhances wealth.
  7. Ongoing financial education. Continual learning is the foundation for financial success. Investigate portfolio allocations and changing economic dynamics by reading intensely, connecting with mentors, and using AI and online research to learn.

It’s not about a person’s intelligence, effort, or income. Wealth is created when you think differently about money while consistently applying financial literacy principles instead of incorrect assumptions.

For additional information on developing financial wealth, go to:

https://www.newtraderu.com/2026/01/06/10-habits-of-the-rich-vs-the-middle-class-due-to-financial-literacy/

Teaching Suggestions

  • Have students talk to others to obtain suggestions that could enhance a person’s financial success.
  • Have students use AI research to obtain suggested advice for a financial decision from their life or a decision they might encounter in the future.

Discussion Questions 

  1. Why don’t most people take advantage of the actions presented?
  2. Describe actions a person might take to implement one or more of the topics presented.
Categories: Chapter 1, Chapter 2, Financial Planning | Tags: | Leave a comment

JOB SEARCH SCAMS

Posted on April 25, 2026 by Melissa Hart

Fraudulent activities and scams are present with all financial decisions, and that includes career planning. When seeking employment, beware of these deceptive practices:

  • fake jobs and phony companies are designed to obtain your personal data or to get you to accidentally sign up or buy something.
  • impersonation scams involve fake job postings using real names, actual companies, or university staff, which can result in identity theft.
  • ghost jobs are postings that do not exist; recruiters may use this tactic to build a talent database. 
  • phishing involves emails designed to collect sensitive financial information.
  • upfront payment requests to pay for training materials, background check, or an application fee.
  • too-good-to-be-true job that promises high pay for very little work.
  • unsolicited job offer for a position for which you did not apply.
  • fake interview to try to get bank account numbers or personal information.
  • fake recruiters tempt you with attractive opportunities and try to get your personal or financial information.

Job scam warning signs include: (1) a sense of urgency; (2) emails and websites with grammar and spelling errors; (3) generic email domains, instead of company name; (4) vague job descriptions; and (5) requests for upfront money.

To help prevent job scams, consider these actions:

  • be wary of job offers with high salaries, requiring you to work from home, and a rushed hiring process.
  • verify the company on their official website and check online reviews.
  • be cautious before providing personal information and financial data.

For additional information on job search scams, go to:

https://clark.com/employment-military/job-search-scams/

https://www.flexjobs.com/blog/post/common-job-search-scams-how-to-protect-yourself-v2

Teaching Suggestions

  • Have students talk to others to learn about actions they have taken for successful job searches.
  • Have students conduct online and AI research to create a video with warning signs to avoid job scams.

Discussion Questions 

  1. What things might you hear or see that would make you suspicious of a job posting or job offer?
  2. Describe actions a person might take to avoid job scams.    
Categories: Career, Chapter 2, Chapter 6, Frauds and Scams | Tags: , | Leave a comment

NET WORTH: A DIFFERENT APPROACH

Posted on March 28, 2026 by Melissa Hart

In basic terms, net worth, the difference between a person’s assets (what they own, items of value) and liabilities (amounts owed), is viewed on a person’s personal balance sheet. Assets in the amount of $196,000 minus liabilities of $63,000 results in a net worth of $133,000. However, the amount of net worth may not truly reflect financial security.

When viewing net worth, remember, not all assets have the same financial benefit:

  • Productive wealth involves assets that are actively working for you generating income, dividends, interest and capital gains. These include savings accounts, retirement accounts, investment accounts, and rental property.
  • Sellable wealth includes assets with a market value that you could and would sell under certain circumstances. While these assets are not generating income, the value would be available if you needed the money.
  • Estate wealth includes assets with paper value but that you either can’t or are unwilling to sell. These include your primary home, car, business ownership, and sentimental assets such as family heirlooms and antique collectibles. Home equity and other estate items will usually not be viewed as available wealth.

While home equity and business ownership increase net worth, these have limited usable wealth due to illiquidity. When planning finances, emphasize productive or sellable assets for usable wealth; don’t just seek a larger net worth.

For additional information on net worth, go to:

https://clark.com/personal-finance-credit/a-better-way-to-think-about-your-net-worth/

Teaching Suggestions

  • Have students create a proposed future balance sheet that emphasizes productive and sellable wealth.
  • Have students use AI research to obtain suggestions for increasing a person’s productive and sellable wealth.

Discussion Questions 

  1. Why might a person overlook the value of productive and sellable wealth over estate wealth?
  2. Describe actions a person might take to emphasize productive and sellable wealth.   
Categories: Budget, Chapter 2 | Tags: , | Leave a comment

STORING YOUR FINANCIAL DOCUMENTS

Posted on January 17, 2026 by Melissa Hart

Apartment lease, insurance policies, credit card receipts. These are just a few of the many financial documents you may encounter. To maintain control over these records, consider a system of paper copies, digital versions, or both.

When sorting and tossing financial documents, be sure to keep these documents for the time suggested:

  • Tax records – seven years; unless you have a simple tax return, then three years
  • Bank, investment statements – keep annual statements indefinitely
  • Estate plan documents, social security card, birth certificate, marriage, divorce, adoption records – indefinitely
  • Insurance policies – only keep current policies, not expired ones
  • Loan documents – until debt is paid off
  • Real estate transactions – three years after closing
  • Proof of ownership (titles) – as long as item is owned
  • Medical bills – one year after paid

When in doubt as to the length of time to keep an item, create a digital copy of the financial document. Paper copies should be shredded when the document is no longer needed.

Three common options for the physical storage of documents are:

  1. A locked cabinet allows you to have easy access to financial records in your home. Beware that the contents may be accessed by a thief or damaged by a fire or flood.  
  2. A fireproof safe offers greater protection. However, it could be stolen without proper precautions such as bolting it to the floor.
  3. A safe-deposit box at a bank (for a fee) can provide greater security for your documents and valuables.

Digital storage of documents might include your home computer, an external drive, or a cloud service, such as Dropbox, Google Drive, Microsoft One Drive, iCloud or Amazon Cloud Drive. For your digital documents:

  • download from the source (or scan) each document, saving them into folders by type of record
  • secure your information using password protection, file encryption and two-factor authentication
  • back up your data on a regular basis

A hybrid system (physical and digital) is often recommended. Then, if paper copies are lost or destroyed, or computer files crash, you are protected with access to the other source.

Organizing financial paperwork to allow access by family members is especially important for estate plan documents. Your attorney can store original documents. Online document storage services for estate planning can be located with an Internet search.

The main documents that should be part of an estate plan file are:

  • Will or trust; Powers of attorney for finances and health care
  • Organ donation form; Living will; HIPAA release
  • Letter of instruction for your heirs; beneficiary designations; password list
  • Bank and investment statements; retirement account documents
  • Real estate deeds and titles; life insurance policies; funeral instructions
  • List of important personal property, such as jewelry, artwork, and estimated values

Updating estate plan documents when a life change occurs is vital. Your attorney can assist with this process whenever a death, birth of a grandchild, divorce, or sale of property takes place. An annual review of your estate documents is also recommended.  

For additional information on storing financial documents, go to:

Link #1

Link #2

Teaching Suggestions

  • Have students list the financial documents and records they currently use.
  • Have students create a visual to communicate the system they might use for storing their financial documents.

Discussion Questions 

  1. What features would you recommend for an effective and efficient financial document storage system?
  2. Describe financial difficulties and money management concerns that could occur if a person doesn’t have an appropriate financial documents storage system.
Categories: Chapter 2, Chapter_14, Estate Planning, Financial Planning | Tags: , | Leave a comment

DID YOU KNOW THAT WHERE YOU LIVE MAKES SAVING EASIER?

Posted on January 3, 2026 by Melissa Hart

The state you live in can influence how well you’re able to save money. A bankrate.com study analyzed economic conditions, interest rates for certificates of deposit (CDs) and high-yield savings accounts, and taxes to rate the places easiest to save.

The ten states that were most favorable to savers were Tennessee, Missouri, Texas, Oklahoma, Florida, Kentucky, South Dakota, Louisiana, Indiana, and Michigan.  Many of these states have areas with a low cost of living. Some don’t have state income taxes, these include Florida, Tennessee, South Dakota, and Texas.

In contrast, the ten states that were least favorable for savers were Hawaii, Connecticut, Vermont, California, New Jersey, Delaware, Maryland, Massachusetts, Washington, New York, and Oregon. These states tend to have a higher cost of living; many of them have higher taxes.

No matter where you live, you can increase your savings by:

  • using a budgeting app to maintain a complete record of your finances. By tracking your spending, you can target an amount each month for saving.
  • automating your monthly saving with online transfers to a separate account. 
  • researching online banks to take advantage of higher savings rates for CDs, money-market accounts, and high-yield savings accounts in other geographic locations. 

For additional information on the best saving states, go to:

Link #1

Link #2

Teaching Suggestions

  • Have students obtain suggestions from others on how to increase their savings.
  • Have students search online for websites and AI prompts that would help them increase their savings.

Discussion Questions 

  1. Other than the interest rate, what features of a savings account might be considered when deciding where to save?
  2. Describe actions a person might take to obtain a higher return on their savings.
Categories: Chapter 2, Chapter 4, Savings | Tags: | Leave a comment

AI-Proof Your Career

Posted on December 6, 2025 by Melissa Hart

Artificial Intelligence (AI), as with any new technology, creates a changing job market. While news stories may produce fear among workers, be reminded that new technologies always create a need for adapted job skills. In the case of AI, career experts recommend: (1) focusing on skills that humans do best, and (2) adapting to what AI can help you do better.

The skills that humans do best involve activities related to emotional intelligence, ethics, and creativity. For ongoing career success, develop soft skills in the areas of communication, empathy, leadership, teamwork, and negotiation. In addition, enhance critical thinking abilities to question assumptions and analyze complex situations. Also important is improved creativity related to designing, writing, innovation, and generating ideas.

These high-touch human skills, which are harder to automate, are essential in jobs requiring trust, collaboration, and intricate decision-making. Career fields requiring in-person contact and discernment include healthcare, counseling, teaching, mentoring, therapy, customer experience, coaching, legal guidance, technical trades, crisis support, and creative and performance arts.

Since every worker will be affected by AI, basic technical competency is necessary. A well-prepared career person will need to be AI-literate. While you don’t have to be a programmer or software engineer, your AI skills should include:

  • knowledge of the capabilities and limitations of AI.
  • an ability to write clear, complete prompts to optimize responses.
  • using AI tools for workflows and other career tasks.
  • awareness of current AI trends and applications in your industry.

Using AI as your productivity partner means you will be able to leverage it to automate repetitive tasks, brainstorm ideas, develop preliminary drafts, and suggest analyses.

Ongoing learning and continually updating your skills is vital. Actions to achieve these competencies include taking online courses, earning AI certifications, joining online AI forums, starting an AI club, building a personal project, learning a programming language such as Python, and subscribing to AI and machine language YouTube channels.

While AI won’t replace all jobs, it will impact every worker in some way. To best prepare for the future, blend basic tech competency with strong human skills and seek opportunities for learning and growth. The most successful employees will be those who collaborate with AI and do what technology cannot do. 

For additional information on AI proofing your career, go to:

Link #1

Link #2

Teaching Suggestions

  • Have students identify online resources to enhance their AI skills.
  • Have students create a plan to enhance their soft skills for ongoing career success.

Discussion Questions 

  1. What soft skills might be most valuable for a person’s ongoing career success?
  2. Describe actions a person might take to better use AI for their daily activities and work tasks.
Categories: Career, Chapter 2, _Appendix B

SHOULD YOU REFRESH YOUR BUDGET?

Posted on September 27, 2025 by Melissa Hart

Whether you have been budgeting for a month, a year, or longer, a regular review of your spending plan is vital.  Several situations may indicate a need for a revised budget; these include:

  • Worrying about money emergencies. Be sure your budget includes savings to create an emergency fund for unexpected expenses.
  • Using the same budget each month. Spending needs are likely to change from month to month, as a result slight changes might be necessary.
  • Not tracking expenses. A record of your actual spending is vital for budgeting success. 
  • Overspending in a budget category. Be sure your plan is realistic and helps you avoid unneeded spending.
  • Avoiding a “sharing” category. The SPEND, SAVE, SHARE framework is a recommended approach. Giving to church, charities, and worthy causes contributes to living a fulfilled life and contentment.
  • A major change in income. A raise should not result in lifestyle inflation in which you significantly expand your spending. Or, a loss of job can result in an extensive budget adjustment along with use of emergency funds. Your emphasis will likely be on spending for food, utilities, shelter and transportation.
  • Not considering inflation. Most people have been affected by rising costs of many items requiring an adjustment in budgeted amounts.
  • Overlooking annual and seasonal expenses. Planning for holidays, vacations, back-to-school expenses, and semiannual auto insurance requires setting aside an amount each month for those items. Not doing so may result in increased debt or using your emergency fund for something that is not an emergency.
  • Planning for funds from paid off debt. As you pay off credit cards and loans, those monthly payments can now be used to expand your emergency fund and other savings goals.
  • Not coordinating budget items with savings goals. If your spending and saving activities are not helping you achieve your financial goals, a revised budget may be needed.

For additional information on refreshing your budget, click here.

Teaching Suggestions

  • Have students talk to others to learn actions used for successful budgeting.
  • Have students research budgeting apps that could help them better plan their money management activities.

Discussion Questions 

  1. What features of an app might be helpful for successful budgeting activities?
  2. Describe actions that might be taken when a person needs to revise their budget.   
Categories: Budget, Chapter 1, Chapter 2 | Tags: ,

A.I. PROMPTS FOR IMPROVED FINANCIAL DECISIONS

Posted on August 16, 2025 by Melissa Hart

Artificial intelligence (AI) is influencing every aspect of life and learning.  A vital skill when using AI is creating prompts to obtain valid information for your specific life situation. When creating an AI prompt, be sure to:

  • specify desired length, style, format, reference dates, reading level.
  • identify intended use, purpose, and audience.
  • begin with action verbs: create, design, explain, compare, summarize
  • split complex requests into subtasks and subproblems.
  • include examples and background information for context.
  • avoid complicated or unusual words.
  • submit follow-up requests to verify, clarify, and expand results.
  • ask for references from resources consulted.

Some suggested AI prompts to guide your financial decisions include:

Budgeting: “Help me create a monthly budget. My monthly take-home pay is [amount] with these fixed expenses [list items, amounts]. I have monthly variable expenses of approximately [amount]. I plan to save at least [amount] each month for [financial goal] in [number] years. Suggest budget categories and amounts.”  

“My variable income averages about [amount] each month. I have fixed monthly expenses of [amount].  What actions are suggested to plan for taxes, savings, and variable expenses?”

Banking Services: “Suggest a bank or credit union that minimizes fees and provides appropriate payment, savings, and loan services. I am a [describe current life situation] with a monthly income of [amount].”

Taxes: “I plan to move to [state/country], my current annual income is [amount]. What factors should I consider related to potential tax obligations in this new location?”

Wise Credit Use: “Each month, I use my credit card for several purchases, and always pay off the balance. How will this affect my credit score? What additional actions would help me build my credit score?” 

Insurance: “I’m currently [age] and [marital status] with [number] dependents. My income is [amount]. What amount of life and disability insurance should I consider? What would be an appropriate amount to pay for this coverage?”

“I currently drive a [year, make, model] vehicle, and am paying [amount] a year for auto insurance. What actions should I consider to review my coverage and reduce my insurance payment?”

Housing:  “My monthly income is [amount], I pay [amount] in monthly rent, and have [amount] saved for a down payment. How should I determine if I can afford closing costs and long-term homeownership expenses?“

Buying a Car: “I’m considering a used [year, make, model]. I’m able to afford [amount] for this purchase. What factors should I consider before buying this vehicle?”

Investing:  “I’m [age] with an annual income of [amount]. I’ve saved [amount] in an emergency fund. Now I would like to start investing for [goal] to be achieved in [number of years]. What investments should I consider?” 

Retirement Planning: “I’m [age], self-employed, and earn [amount] a year. What options do I have available to save for retirement?”

Wise Shopping:  “I’m planning to buy [item, model, other details] with a budget of [amount]. What actions would result in getting the best deal, strong customer service, and a good warranty?

Avoiding Consumer Fraud:  “When researching and buying [describe product or service] online, what actions should be taken to determine if an offer is genuine and to avoid being scammed?”

Wealth Creation:  “Based on my current key skills of [list 3-5 strongest abilities],  suggest three unique actions to use my existing skills to increase my income. For each action, suggest specific steps to implement the action and estimate the potential financial benefit.”

Despite every effort to obtain valid AI responses, be aware of these potential drawbacks:

  • Responses may possess bias and include flawed logic.
  • Incorrect facts or results not based on current financial data.
  • Inaccurate calculations and erroneous predictions.

For additional information on AI prompts for personal finance, go to:

Link #1

Link #2

Link #3

Link #4

Teaching Suggestions

  • Have students create and use an AI prompt to obtain guidance for a financial decision. Compare the response received with other sources (online search, information from friends or relatives).
  • Have students talk to others to obtain ideas on how AI is being used for financial decisions.

Discussion Questions 

  1. What features of AI might be most useful to help people improve their financial planning activities?
  2. Describe actions a person might take to evaluate the validity of an AI response.   
Categories: Chapter 1, Chapter 2, Financial Planning Topics | Tags: , | Leave a comment

MAKING ENDS MEET

Posted on May 17, 2025 by Melissa Hart

A study conducted by the Consumer Financial Protection Bureau (CFPB) reported that overall financial stability and well-being worsened from 2023 to 2024. The findings of the surveys included:

  • Fewer households can cover a month of expenses if they lose their main source of income. If the main source of income were lost, 42 percent of households could cover expenses for a month or less; 22 percent would be able to cover expenses for less than two weeks.
  • More households had difficulty paying bills or expenses. The share of families with these difficulties increased from 38 percent in 2023 to 43 percent in 2024.  38 percent of non-Hispanic white consumers in the study had difficulty paying bills or expenses, 63 percent of Black consumers in the study had difficulty, and 51 percent of Hispanic consumers in the study had difficulty.  
  • Financial well-being measured using the CFPB’s Financial Well-Being Scale declined.  Overall financial well-being fell to 48.7 in 2024 from 51.0 in 2023. The number of consumers with low or very low financial well-being increased from 16 to 22 percent.
  • Access to credit was also difficult for some. In 2024, 40 percent of consumers in the study applied for credit. Of those who applied, 39 percent were either denied credit or approved for a lower amount than requested. In addition, 27 percent decided not to apply because they expected to be turned down.
  • The use of credit card debt fell slightly. In 2024, 80 percent of consumers in the study had a credit card. Of those consumers, the share with revolving credit card debt decreased slightly from 53 percent in 2023 to 49 percent in 2024. Meanwhile, 23 percent of consumers with a credit card reported paying a late fee, unchanged since 2023.
  • Many respondents use multiple credit sources. About half of those in the study used a payday or pawn loan in the past year and had a credit card. About four-fifths of survey respondents had an auto title loan, buy-now-pay-later loan, or experienced an overdraft, and had a credit card.

The financial deterioration reported in this study was not the result of one specific cause. Factors that may have contributed to the situation include inflation, housing costs, high interest rates, and student loan payment resumption.

For additional information on making ends meet, see the following links.

Making Ends Meet Insights
Making Ends Meet Report
Well Being Scale

Teaching Suggestions

  • Have students interview another person about the actions taken to avoid financial difficulties.
  • Have students access the full research study to obtain additional findings and to suggest actions that might address the financial difficulties.

Discussion Questions 

  1. How might a person make use of family members, friends, and community resources when encountering financial difficulties?
  2. Describe actions a person might take to avoid the financial difficulties reported in this study.
Categories: Budget, Chapter 1, Chapter 2, Credit Cards, Debt | Tags: , | Leave a comment

STRATEGIES FOR CAREER ADVANCEMENT

Posted on April 5, 2025 by Melissa Hart

For your career development and employment advancement, consider these actions:

  • Show your flexibility. People often believe that being indispensable and irreplaceable will guarantee job security. However, this approach can limit your career potential and opportunities. The key to success is to make yourself valuable but not indispensable. Being vital in doing one specific thing might result in your supervisors not wanting to move you from that position. You need to be very good at your job and willing to teach others the skills you have developed.
  • Take on new challenges. Your ability to adapt to new responsibilities shows your career potential. Seek opportunities beyond your usual job, especially those at the next level of the organization. Going above and beyond expectations may involve taking the initiative to support your manager’s workload or suggesting a plan to address an ongoing company concern.
  • Communicate your ambitions. Discuss your ambitions and abilities with those who make the hiring decisions. Get comfortable talking about your skills, experiences, and accomplishments that set you apart from others. This strategy can help you be considered for a position even before the job becomes available.
  • Use internal networking. Go beyond impressing your direct supervisor or hiring manager. Connect with others within your organization to talk about current projects, industry trends, and personal interests. Consider informational interviews with supervisors and others you don’t work with regularly. These interactions will make you known within the company and provide a better understanding of the overall organization.
  • Understand your personal motivations. Before seeking a promotion, consider what you want in your career. Carefully assess if a promotion is the next appropriate step to your long-term career aspirations and personal satisfaction. Moving from work you enjoy may not be in your best interest.

For additional information on job promotion strategies, click here.

Teaching Suggestions

  • Have students talk to others to learn about the actions they have taken to improve their career opportunities.
  • Use an AI platform to seek guidance for a career development plan. Enter your abilities, interests, and career aspirations and ask for actions for your career path.

Discussion Questions 

  1. Which actions in the article might you consider using in the future?
  2. Describe an action plan you might take for your future career advancement.    
Categories: Career, Chapter 2 | Tags: | Leave a comment

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