Be prepared for a lifetime of financial decision making.
Foundations of Personal Finance will help guide you to becoming
financially capable as you plan for your future.
Personal Finance—Why It Matters
As a young adult, it is important for you to understand how
to earn, spend, and save your money so that you can lead
the life you choose. Learning how to set goals
and create a plan to meet
those goals is a valuable skill
that will pay great dividends
in your future. To help guide
you in creating a personal plan,
Focus on Finance provides
information on topics that
gives you a solid foundation of
financial information.
It is all about getting ready for college and career. College
and Career Readiness activities address literacy skills to
help prepare you for the real world. The Common Core
State Standards for English Language Arts for
reading, writing, speaking, and listening are
incorporated in a Reading Prep activity as well
as end-of-chapter Common Core activities.
Common Career Technical Core Career Ready
Practices are also addressed.
G-W Learning companion
Common Core
CTE Career Ready Practices.
Create a Venn diagram to show
the relationship between your careyour
er interests, your preferences,
your goals, and requirements of career choice. Where do
the circles overlap? What do you think overlap signifies? What
would a diagram with a lot of overlap tell you? What about one
with little or no overlap?
Reading.
Using independent research and the information contained in the
text, write a report in which you analyze consumer spending. How does
consumer spending connect with other important events or ideas that are
influential in our economy? Cite specific evidence from the text and your
research to support your understanding of this issue.
Writing.
Identity theft is a serious problem for business as well as consumers.
Conduct research on how much money businesses lost in the last year due to
identity theft. Write an informative report consisting of several paragraphs to
describe your findings of the implications for consumers.
College
and Career
Readiness
4
College
and Career
Readiness
Reading Prep.
Review the table of contents
for this text. Trace the development of the
content that is being presented from simple
to complex ideas.
Student Focused
557
Personal Finance
Why It Matters
It is important to understand the basics of economics and
its impact
on your personal finance. Economic systems are based on choices—what
choices of what to produce, how to produce it, and how to distribute
we produce. These choices are necessary because wants
and needs
are unlimited and the resources to meet them are limited. This creates
scarcity and requires us to decide which needs or wants to satisfy. In our
market economy, buyers and sellers (consumers and
producers) make
free economic choices that determine what we will produce, hoof
w we
will use productive resources, and who will receive the benefits our
productivity. The economic choices you make connect you to millions of
other consumers in the United States and around the world.
The economic
decisions of
consumers impact
the overall economy.
Smart consumers
avoid the pitfalls that
a market economy
can create.
Chapters
18
Economic
Principles
19
Government and
the Economy
20
Consumers in the
Economy
21
Global Economy
72
Income gives individuals spending money. Taxes give the various levels
of government their spending money, which is called
revenue.
A major way
for a government to raise revenue is by taxi
ng each person’s income as well
as items they buy or own. The
governmeall.
nt then uses that revenue to provide
public goods and services that benefit As a teen, you use some of those
goods and services now, such as schools, libraries, parks, highways, and
police protection. As an older adult, you will use other types of public goods
and services, such as Social Security
benefits.
College
and Career
Readiness
Focus on Finance
Social Security Number
A Social Security number serves two major purposes. The Social
Security Administration uses this number to
keep a record of your covered
earnings. These earnings determine the amount you
will eventually receive
in retirement, disability benefits, or benefits to your survivors if you die.
The Internal Revenue Service also uses your
Social Security number as a
taxpayer identification number on all tax returns and IRS forms.
Today, most parents apply for a Social Security number for their children.
It is needed to claim a child as a dependent on income tax returns, to open a
bank account, to buy savings bonds, and to obtain
health insurance coverage.
When giving the information required for
a birth certificate, parents are
asked whether they wish to apply for a Social Security number. Normally,
the hospital will provide all
needed to do this. Applications
also are available online at
www.socialsecurity.gov.informationthe
No two Social Security numbers are the same. Your number is yours alone.
It prevents your records from being mixed up with the records of someone else
who may have the same name. If you lose your card or change your name,
contact the nearest Social Security office for a new c
ard. Safeguard your Social
Security number. Do not carry it with you or givdamage
e it out unnecessarily. Criminals
can use this number to steal your identity and your finances.
Chapter 3
Income and Taxes
Reading Prep.
Before you begin reading
this chapter, try to find a quiet place with
no distractions. Make sure your chair is
comfortable and the lighting is adequate.