Diving Into Spending Plans! How to budget your money properly.

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  • Diving Into Spending Plans!How to budget your money properly

    Take Charge Today Edited April 2007 Diving Into Spending Plans Slide *Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona1.2.41.G1

    Today Well Talk About Spending Plan/Budget - What is it? Why use it?Income and Expense

    Take Charge Today Edited April 2007 Diving Into Spending Plans Slide *Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona1.2.41.G1

    Why do you think this happens? People do not make enough moneyPeople spend too much moneyAlmost half of all American families spend more money than they make.

    Take Charge Today Edited April 2007 Diving Into Spending Plans Slide *Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona1.2.41.G1

    Values, Needs, & WantsWhat is a need? Something that is a necessityFood, water, shelter...What is a want? Something that is not a necessity but is desiredCoffee from Starbucks, skis

    Take Charge Today Edited April 2007 Diving Into Spending Plans Slide *Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona1.2.41.G1

    Why do needs and wants matter?Trade-Offs and Opportunity CostsTrade-off - giving up one thing for anotherOpportunity cost the value of the next best alternative that must be forgone as a result of a decisionUse trade-offs and opportunity costs to help you make these decisions

    Is the trade-off to your decision a need or a want? What is the value (opportunity cost) of that trade-off to you?

    Take Charge Today Edited April 2007 Diving Into Spending Plans Slide *Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona1.2.41.G1

    Spending Plan/Budget - What is it?

    A spending plan/budget is A tool to help people manage their money

    Take Charge Today Edited April 2007 Diving Into Spending Plans Slide *Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona1.2.41.G1

    Spending Plan/Budget - Why use it?Why would you want to know where your money is going?

    Spending plans/budgets are used to help peopleTrack where their money is goingIdentify income and expensesMeet financial goals

    Take Charge Today Edited April 2007 Diving Into Spending Plans Slide *Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona1.2.41.G1

    A Spending Plan/Budget Tracks..IncomeMoney earnedExpenseMoney spent Variable: Changes each monthFixed: Remains the same each month

    Take Charge Today Edited April 2007 Diving Into Spending Plans Slide *Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona1.2.41.G1

    Spending Plan/Budget ContentsIncome

    Expenses: Fixed or variable?HousingUtilitiesTransportationSavingsFoodInsuranceClothing

    Take Charge Today Edited April 2007 Diving Into Spending Plans Slide *Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona1.2.41.G1

    Lees Spending Plan ExampleDoes Lee have enough income to pay his expenses?If he would like to buy a new shirt for $15, does he have enough money?

    IncomeExpensesItemAmountItemAmountMowing a lawn$10.00Movie ticket and popcorn$15.00Birthday gift$15.00Snack and drink$5.00Total$25.00Total$20.00

    Take Charge Today Edited April 2007 Diving Into Spending Plans Slide *Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona1.2.41.G1

    In ConclusionA spending plan isA tool to help people track their moneyA spending plan is based on Values, wants, and needsA spending plan tracksIncome and expenses

  • The End!

    *One point to each group that answers, each group gets a chance Write on paper*One point for each group

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