Module27 - Engineering Economy for Personal Finance Part I...

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Unformatted text preview: Engineering Economy for Personal Finance Part I Common Financial Decisions Budgeting Investments -- future and retirement Selecting a Job Buying a House Buying a Car Buying Insurance Investing: When and Why Florida Grad Invests $2,000 per year @12% per year with new job (age 21) Quits investing at age 31, but leaves money in account. At age 55 : $596,659 At age 65 : $1.85 M Non-Florida Grad Waits 10 years to start. Invests $2,000 per year @12% per year (age 31, never stops): At age 55 : $266,668 At age 65 : Investing Basics Make a budget-- determine needs, fun and money to invest (at least 10% salary) Should set aside money for emergencies 3-4 months of salary Investment Investing Mechanisms Use your company 401K to the maximum Tax deferred: pretax dollars invested, earnings not taxed until spent! Matching programs Contribute to an IRA if possible Tax deferred earnings (taxes paid at deposit or when removed) Can pull out money for first Where to Invest...
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This note was uploaded on 01/11/2012 for the course EIN 4354 taught by Professor Tufecki during the Fall '08 term at University of Florida.

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Module27 - Engineering Economy for Personal Finance Part I...

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