12.E1a In making economic decisions in any role, individuals should consider the set of opportunities that they have, their resources (e.g., income and wealth), their preferences, and their ethics.

12.E1b Sound personal financial (money management) practices take into account wealth and income, the present and the future, and risk factors when setting goals and budgeting for anticipated saving and spending. Cost-benefit analysis is an important tool for sound decision making. All financial investments carry with them varying risks and rewards that must be fully understood in order to make informed decisions. Greater rewards generally come with higher risks.

12.E1c Managing personal finance effectively requires an understanding of the forms and purposes of financial credit, the effects of personal debt, the role and impact of interest, and the distinction between nominal and real returns. Predatory lending practices target and affect those who are least informed and can least afford such practices. Interest rates reflect perceived risk, so maintaining a healthy credit rating lowers the cost of borrowing.

12.E1d To be an informed participant in the global economy, one must be aware of inflation and have an understanding of how international currencies fluctuate in value relative to the United States dollar.