Grades 9–12
Launch
The money skills nobody hands you
In a couple of years you will sign a lease, read a pay stub, pick an insurance plan, and decide how much to borrow. None of that is hard, but all of it is unfamiliar. This book walks you through the seven money topics that matter most, with the actual math.
Seven lessons
- 1Reading Your First Paycheckp. 3
- 2Your Credit Scorep. 5
- 3Your First Carp. 8
- 4The Real Cost of Credit Cardsp. 10
- 5Your First Placep. 12
- 6How Insurance Actually Worksp. 14
- 7Saving and Investingp. 16
Launch · 2Reading Your First Paycheck
Your gross pay is what you earned before anything is taken out. Your net pay (take-home) is what actually lands in your account after deductions. The difference is mostly taxes: federal income tax, state income tax, and FICA, the 7.65% that funds Social Security and Medicare.
Study this two-week paycheck
| Line | Amount |
|---|---|
| Gross pay | $1,000.00 |
| − Federal income tax | $100.00 |
| − Social Security & Medicare (FICA) | $76.50 |
| − State income tax | $40.00 |
| = Net / take-home pay | $783.50 |
Answer using the stub above
- How many dollars total were withheld from the $1,000 gross pay?
- What percent of gross pay did all the deductions take? (dollars withheld ÷ 1,000 × 100)
- If you worked the same amount for a full year (26 paychecks), estimate your yearly take-home pay.
Launch · 3The W-4 and Why It Matters
On day one of any job you fill out a W-4. It tells your employer how much tax to hold back from each check. If too little is withheld, you owe money in April. If too much is withheld, you gave the government an interest-free loan all year.
Write the term next to its meaning
- Money taken out of your paycheck and sent toward your taxes:
- A person you support financially who is not your spouse:
- A set dollar amount subtracted from your taxable income:
- Single, married filing jointly, or head of household:
- What you get back when too much was withheld:
Fill out the top of a W-4 for yourself
| Full name | |
| Address | |
| City, state, ZIP | |
| Social Security number | 000-00-0000 |
| Filing status (circle) | Single Married filing jointly Head of household |
| Number of dependents |
For educational purposes only. Please do not write your full, actual Social Security number on this or any practice form.
Launch · 4Your Credit Score
A credit score is a number (roughly 300 to 850) that lenders use to guess how reliably you repay borrowed money. A higher score can mean easier approvals and lower interest rates on cars, apartments, and loans. Five things shape it:
What goes into a score
All five together build one number.
Which side is each habit on?
Circle Helps or Hurts for each habit.
| Habit | Your score |
|---|---|
| Missing a payment or paying late | Helps / Hurts |
| Paying every bill on time, every time | Helps / Hurts |
| Maxing out a credit card | Helps / Hurts |
| Keeping old accounts open | Helps / Hurts |
| Using only a small part of your limit | Helps / Hurts |
| Opening lots of new cards at once | Helps / Hurts |
Launch · 5What a Score Actually Costs You
A credit score is not a grade for its own sake. It is a price tag. Here is the same $20,000 car loan at three different scores, over five years.
The same car, three different buyers
| FICO score | APR | Monthly payment | Total paid over 5 years | Interest paid |
|---|---|---|---|---|
| 780 (very good) | 6% | $387 | $23,220 | $ |
| 680 (good) | 11% | $435 | $26,100 | $ |
| 580 (fair) | 18% | $508 | $30,480 | $ |
Interest paid = total paid − $20,000. Fill in the last column. Then: how much more does the 580 buyer pay than the 780 buyer, for the exact same car? $
Starting from zero
With no credit history, no score exists yet. Check the steps you could realistically take in the next two years.
- Become an authorized user on a parent’s card in good standing
- Open a share secured loan, backed by your own savings, or a credit builder loan, which holds the money until you repay it
- Open a secured card, where your deposit becomes the limit
- Put one small recurring bill on a card and autopay it in full
Never carry a balance just to “build credit.” It only costs interest.
Launch · 6Where You Bank Matters
Your first checking account, your first card and your first loan will all come from somewhere. Banks and credit unions offer the same basic accounts, and both are federally insured. The difference is who they work for.
Bank vs. credit union
| Bank | Credit union | |
|---|---|---|
| Who owns it | Investors who buy its stock | Its members, the people who save and borrow there |
| Who it works for | Its shareholders, who expect a profit | Its members. It is not-for-profit |
| Where profit goes | Paid out to shareholders | Back to members, often as better rates and lower fees |
| Who runs the board | Directors chosen by shareholders | Volunteers elected by members, one member, one vote |
| Deposits insured by | The FDIC, up to $250,000 | The NCUA, up to $250,000 |
| Who can join | Anyone | People in its field of membership |
Who can join Fort McClellan: Anyone who lives, works, worships, or attends school in Calhoun, Cleburne, Talladega, Clay, Randolph, Cherokee, Etowah, St. Clair, and Chambers Counties, Alabama, plus their family, can join.
Compare two places for your first account
Look up a credit union and a bank near you, on their websites or by asking. Write what you find.
| Question | Credit union | Bank |
|---|---|---|
| Monthly fee on checking? | ||
| Minimum balance to avoid the fee? | ||
| Overdraft fee? Can you say no to overdraft coverage? | ||
| Secured card or credit-building loan? | ||
| App with balance alerts? |
Which would you pick for your first account, and why?
Launch · 7Your First Car
The sticker price is never the whole cost. A $6,000 used car still costs you every month in insurance, gas, and maintenance. Before you buy, add up what it costs to keep it.
The real monthly cost of a first car
| Cost | Your estimate (per month) |
|---|---|
| Insurance | $ |
| Gas / fuel | $ |
| Maintenance & repairs | $ |
| Loan payment (if any) | $ |
| Total monthly cost | $ |
Not sure what to write? Ask a family member what they pay, or get a free insurance quote online for a car you like.
Your total from above, over a year
Total monthly cost $ × 12 = $ a year
Say you take home about $12 an hour. Hours of work to pay for one year of the car: yearly cost ÷ $12 = hours
Launch · 8How Long Should a Car Loan Be?
A longer loan shrinks the monthly payment, which is why dealers offer it. It also means paying interest for longer. Here is the same $15,000 car loan at 7%, three ways. The rate is an example.
Same car, three loan lengths
| Loan length | Monthly payment | Total paid | Interest paid |
|---|---|---|---|
| 36 months (3 years) | $463 | $16,674 | $ |
| 60 months (5 years) | $297 | $17,821 | $ |
| 72 months (6 years) | $256 | $18,413 | $ |
- Interest paid = total paid − $15,000. Fill in the last column. (Payments are rounded, so a total can differ by up to about $20 from payment × months.)
- How much more interest does the 72-month loan cost than the 36-month loan? $
- A car loses value every year. Why could a long loan leave you owing more than the car is worth?
Ways to borrow less
Check each one you will do.
- Save a down payment first
- Get preapproved at a credit union before you visit a dealer (Fort McClellan offers Auto Loans)
- Shop for the total price, not the monthly payment
- Pick the shortest loan whose payment fits your budget
Launch · 9The Real Cost of Credit Cards
A credit card is a tool. Paid in full every month it is free, convenient, and builds your score. Carried month to month it is one of the most expensive ways to borrow money that exists.
Write the term next to its meaning
- The yearly interest rate on money you borrow and do not pay back in time:
- A yearly charge some cards apply just for having the card:
- The time before the due date when paying the full balance means no interest on purchases:
- The smallest amount you can pay to avoid a late fee:
- The most the card will let you borrow at once:
- What you currently owe on the card:
Which card would you pick?
You plan to pay your balance in full every month.
You put $400 a month on the card. How much cash back would Card C pay in a year? $
a. Which card would you pick, and why?
b. Why does the APR matter less if you pay in full each month?
c. What changes if you ever carry a balance?
Launch · 10Minimum Payments Are a Trap
Paying the minimum is designed to keep you in debt as long as possible. Here is the same $5,000 balance on two cards, paid two ways: about the minimum ($100 a month), and $50 more.
Card A: 15% APR, $50 annual fee
Total paid does not include the $50 fee, charged at the end of each full year. Interest + fees = total paid − $5,000 + fees.
| You pay | Months | Total paid | Fees | Interest + fees |
|---|---|---|---|---|
| $100 (minimum) | 79 | $7,894 | $300 | $ |
| $150 a month | 44 | $6,507 | $150 | $ |
Card B: 23% APR, no annual fee
Interest paid = total paid − $5,000.
| You pay | Months | Total paid | Interest paid |
|---|---|---|---|
| $100 (minimum) | 168 | $16,739 | $ |
| $150 a month | 54 | $8,046 | $ |
Answer using both tables
- On Card B, adding $50 a month cut the payoff from 168 months to 54. How many years did that save?
- How much interest did that extra $50 a month save on Card B? $
- What do these numbers tell you about paying only the minimum?
Launch · 11Your First Place
Where you live drives almost everything else in your budget. The same salary can feel generous in one city and impossible in another. Before you sign anything, price out the whole picture.
Three places, one paycheck
Jada takes home $3,000 a month and can work remotely. Rent and utilities are given. Fill in what you think the rest would cost, and make every column add up to $3,000. Put whatever is left in Savings. If Savings goes below $0, go back and cut.
| Expense | Small town | Mid-size city | Big city |
|---|---|---|---|
| Rent | $850 | $1,250 | $1,700 |
| Utilities | $140 | $150 | $150 |
| Groceries | $ | $ | $ |
| Car payment | $ | $ | $ |
| Gas & parking | $ | $ | $ |
| Healthcare | $ | $ | $ |
| Phone & internet | $ | $ | $ |
| Fun & restaurants | $ | $ | $ |
| Savings | $ | $ | $ |
| Total (must equal $3,000) | $ | $ | $ |
Launch · 12Reading the Lease
Answer these using your three budgets, then look at what a lease actually commits you to.
Compare your columns
- Where did Jada save the most, and how much?
- A common guideline is to keep rent under about 30% of pay before taxes. What percent of her take-home goes to rent in the big city? Round to the nearest whole percent. %
- Which category was hardest to cut, and why?
- Jada finds a roommate in the big city. Her rent drops to $950 and utilities to $75. How much less does she pay for rent and utilities each month? $
- Which place would you recommend to her? Give one reason that is not about money.
Costs a lease adds that rent does not show
Check each one you would ask about before you sign.
- Security deposit, often one month’s rent, paid up front
- Application and admin fees, usually not refundable
- Renters insurance, frequently required
- Pet deposit and monthly pet rent
- Which utilities are not included
- What breaking the lease early would cost you
Cash needed on day one: first month’s rent, plus a security deposit of one month’s rent, plus about $100 in fees.
Place I picked: Total: $
Launch · 13How Insurance Actually Works
Insurance uses intimidating vocabulary, but the structure underneath is simple: you pay a little every month so that a disaster does not cost you everything at once. Health insurance has the most moving parts, so it is worth learning on.
The six terms that matter
| Premium | What you pay every month, whether you use it or not. |
| Copay | A flat amount for certain visits, like $25 to see a doctor. |
| Deductible | What you pay yourself before insurance starts paying. Premiums and copays do not count. |
| Co-insurance | After the deductible, the percentage of the bill you still pay. |
| Out-of-pocket max | The most you pay for care in a year, not counting premiums. After this, insurance pays for all covered care. |
| In-network | A provider with a negotiated discount. This plan does not cover out-of-network care, so there you pay full price. |
Use these numbers on the next page
Monthly premium: $120
Deductible: $3,000
Co-insurance: 20%
In-network doctor copay: $25
Urgent care copay: $50
Out-of-pocket max: $6,500
Launch · 14What Did Each Person Pay?
Six people, same plan, one month. Work out what each actually paid. Include the $120 premium in every answer, since everyone pays it no matter what.
Tally the costs
- Omar did not use his insurance at all this month.
He paid: $ - Zeke cut his leg and went to in-network urgent care. Already paid toward deductible: $25. He pays the $50 urgent care copay, and is also billed for a tetanus shot ($40) and stitches ($150).
He paid: $ - Cami had wrist surgery. Already paid toward deductible: $360. No copay required. Billed: consultation $200, surgery $4,000.
Hint: she pays until she reaches the $3,000 deductible, then 20% co-insurance on the rest.
She paid: $ - Flora saw an in-network doctor for a sore throat. Already paid toward deductible: $100. She pays the $25 doctor copay, and is also billed for a strep test ($40) and an antibiotic prescription ($15).
She paid: $ - Chad hurt his arm and saw an out-of-network doctor who charged $250. Already paid toward deductible: $450. Hint: look back at what out-of-network means.
He paid: $ - Anna had a baby. Already paid toward out-of-pocket max: $6,000. Billed: hospital $4,500, obstetric care $1,500, anesthesia $1,000, lab tests $500.
She paid: $
Why does Anna’s enormous bill cost her so little?
Launch · 15Saving and Investing
Saving is money you keep safe for the next few years: an emergency fund, a car, a deposit on an apartment. Investing is money you will not touch for a long time, put to work so it can grow. You want both.
Compound interest
Compound interest means you earn a return on the money you put in and on the it already earned (fill in the missing word). Your growth starts earning its own growth, so the longer it runs, the faster it grows.
| Years putting money in | Total put in | Worth at 65 | |
|---|---|---|---|
| Priya | 10 | $12,000 | about $816,000 |
| Marcus | 37 | $ | about $466,000 |
Fill in Marcus’s total: $100 a month × 12 months × 37 years.
Priya put in less money. Why did she end up with more?
The Rule of 72
To find roughly how many years it takes money to double, divide 72 by the yearly rate. It works on savings and investments, and it works just as well on debt you are not paying down.
| Money | Rate | 72 ÷ rate = years to double |
|---|---|---|
| Savings certificate | 4% | |
| Stock index fund (long-run average) | 10% | |
| Credit card balance you do not pay | 24% |
The same math that grows an investment grows a debt. Rates are examples only, not current offers.
Launch · 16Where the Money Goes
Knowing you should invest is the easy part. Here is what people actually do with the money, in the order most people do it.
Four places for your money
| 1. Savings account | For your emergency fund and short-term goals. Safe, federally insured, and you can reach it any time. |
| 2. Certificate (CD) | Savings you will not need for a set time, like 6 or 12 months. A higher, guaranteed rate, and still insured. Fort McClellan offers Certificates. |
| 3. Roth IRA | A retirement account you can open once you have a paycheck, even as a teen with a parent’s help. Withdrawals in retirement are tax free if you follow the rules. |
| 4. Index funds | What you buy inside the IRA. An index fund owns every company in a list, so one purchase spreads your money across hundreds of businesses. |
Two common kinds of index fund:
| S&P 500 fund | The 500 largest U.S. companies. Example: VOO |
| Total market fund | Nearly every U.S. public company. Example: VTI |
Funds are named as examples, not recommendations. Investments are not federally insured and can lose value, sometimes for years. That is why the emergency fund comes first.
You earn $1,000 at a summer job
At 10% a year, $1,000 doubles about every years (Rule of 72). Left alone from 16 to 65, that is almost 7 doubles, or roughly $100,000.
Split it up. Make it add to $1,000.
| Spend now | $ |
| Savings account (emergency fund) | $ |
| Invest for the long run | $ |
Launch · 17What “Average” Really Means
“About 10% a year on average” does not mean 10% every year. Here is what the S&P 500 actually did: some years soared, and some fell hard.
S&P 500 return each year, 2000 to 2025 (percent)
Dashed line: the simple average of all 26 years, about 9.6% a year.
$1,000 invested at the start of 2000
Why does steady growth of 8% end where an average of 9.6% does? Losses hurt more than gains help: after a 50% loss, you need a 100% gain to get back to even.
- Which was the worst year, and how much did it lose? Year lost %
- How many of the 26 years went down?
- Someone sold in a panic at the end of 2008. What return did they miss in 2009? %
- Why should money you need in the next few years stay in savings, not stocks?
Source: S&P 500 total returns, Aswath Damodaran, NYU Stern. Since 1928 it has grown about 10% a year. Past returns do not guarantee future results.
Launch · 18Before You Go
Seven questions. If you can answer these, you are ahead of most adults.
Show what you know
- At $16 an hour with about 20% taken out, what is your take-home for a 40-hour week? $
- Name the biggest single factor in your credit score.
- Two cards: 15% APR with a $50 annual fee, or 23% APR with no fee. You always pay in full each month. Which is better, and why?
- What is the difference between a deductible and a copay?
- Your rent is $1,100 and your take-home is $2,600. What percent of your take-home goes to rent? Round to the nearest whole percent. %
- Name one thing you will do in the next year to build credit safely.
- To stay under 30% of an $800 credit limit, what is the most your balance should be? $
Launch · 19You’re ready to launch.
You can read a pay stub, compare cards, price out a city, see what insurance really costs, and put compound interest to work. That is a real head start.
Fort McClellan Credit Union
Serving East Alabama since 1953.
fortmcclellancu.org
Teachers: request class sets and the free answer key.
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This workbook is provided for educational purposes only and is not financial advice.
Anyone who lives, works, worships, or attends school in Calhoun, Cleburne, Talladega, Clay, Randolph, Cherokee, Etowah, St. Clair, and Chambers Counties, Alabama, plus their family, can join.
Federally insured by NCUA. Equal Housing Opportunity.