As you learn about spending, saving and investing wisely, you should also make sure you
understand how to protect your money.
Guard Your Identity
Identity theft is when someone steals another individual’s personal information — such as a bank account,
credit card or Social Security number — to buy goods and services. These steps can help you protect
your identity and your money.
- Keep your birth certificate and Social Security card in a safe place.
- Keep your wireless phone, driver’s license, checkbook and credit card in a safe place.
Do not let friends borrow them.
- Do not share personal information over e-mail or the Internet unless it is a Web site you know and trust.
- Check your credit report at least once each year.
The USAA Educational Foundation publication, Identity Theft,
offers more information.
Review Your Credit Report
When you begin saving and investing, you begin building a credit reputation. Your credit reputation is
summarized in a credit report — a month-by-month record of your interactions with banks, credit card
issuers and other financial institutions.
You can request a free credit report annually from any of the three credit reporting agencies.
Review your credit report annually to ensure it is accurate and that no one has opened unauthorized
accounts in your name. To request your free annual credit report, visit www.annualcreditreport.com or
call one of the following agencies directly.
Manage Risk
Another important method of protecting your assets is with insurance. Right now, a parent or guardian probably
handles your insurance needs. However, you should be familiar with the following basic forms of insurance and
how they work.
| Types Of Insurance |
| Auto Insurance
|
This is usually the first form of insurance you need. Premiums vary by state. Generally, auto insurance
does not cover personal possessions that may be stolen from your vehicle. For that, you need property
insurance, either a renters or homeowners policy. Most personal property will be covered by a renters or
homeowners policy; however, some property, such as CD players and digital audio players, may be limited.
|
| Property Insurance
|
When you have your own apartment or home, you need renters or homeowners insurance to protect your
personal possessions if they are stolen or damaged. These policies may also pay damages if someone is
injured on your property or through your negligence.
|
| Health Insurance
|
This coverage protects your finances from health costs associated with an unexpected accident or major illness.
Generally you are covered by your parent or guardian’s policy until age 23. When you become employed, take
advantage of employer-sponsored/group employment benefits if they are available to you. Purchase an individual
insurance plan if you are between jobs, self-employed or work for an employer who does not provide health
insurance. Carefully review the outline of coverage provided by the insurance company, which should describe
the plan’s benefits.
|
| Life Insurance
|
You need life insurance as soon as a spouse, family member or other individual depends on your income.
Even if you are single with no dependents, you should purchase enough life insurance to pay your debts
and final expenses. Because premiums increase with age and declining health, you should generally purchase
life insurance while you are young and in good health.
|
| Disability Insurance
|
This form of insurance provides you with income if you are unable to work due to injury or illness.
Many employers provide disability coverage, often at little or no cost to employees; however, coverage
may be limited and benefits may be taxable. If your employer provides limited coverage, an individual plan
can also be purchased to supplement your employer coverage.
|
The USAA Educational Foundation publication, Basic Insurance Coverages,
offers more information.
Ready To Invest
To make money, you can earn it by working. To build wealth, you should put your money to work for
you by investing wisely.
As you begin investing to build wealth, remember these important principles.
- Stay out of debt.
- Focus on your goals.
- Think long term.
- Diversify your investments.
- Review your plan.
Investing wisely as part of a comprehensive financial plan can help you enjoy a secure and
rewarding financial future.
|
Basic Money Management
Basic Money Management
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