Slide 1

Family Feud: Money, Money, Money!!! Family Budgeting Basics Slide 2 Welcome to the Future! Imagine your Future Lets say youre married with 2 kids. Your kids are 13 and 16. What do you want? What things do you envision your family having and doing. Using only the first column of your Family Feud Packet, complete the Checklist. Simply, put a check next to the items you desire. YOU MUST USE PENCIL FOR THIS ENTIRE ACTIVITY! Example: Housing: What kind of house do you see your family living in? _ _ New large 3 story house with basement and pool ____ Older 2 story house with a nice yard ____ Garden Home (one level home) with a small yard ____ Apartment Slide 3 Everything comes with a price Now, you are going to see how much each of these things cost Write the cost of the option you chose in the second column of your paper labeled cost. ExpendituresCost Housing: What kind of house do you see your family living in? ____ New large 3 story house with basement and pool ____ Older 2 story house with a nice yard ____ Garden Home (one level home) with a small yard ____ Apartment $2800 $1600 $1000 $800 Cars: What kind of cars for you, your spouse drive, and 16 year old? How many of each? ____ New Luxury Cars (like Mercedes, BMW, Lexus) ____ New Mid-level Cars (like Honda, Volkswagen, Kia) ____ Slightly Used Car that isnt too old, but runs well ____ Old Used Car that still runs, but is old. $800 each $400 each $250 each $100 each Gas for Each Car You must pay for gas for each of your cars. Gas- # of cars x $100 per car = Savings: Do you want you can do both ____ Vacation at least once a year ($2500 or $200 per month) ____ Christmas/ Birthday Gifts $200 $100 Savings: College Savings for your Kids College 2 kids/ per month ____ Public/4 year/In-state (Alabama, Auburn, UAB, etc) ____ Public/4 year/Out of State (LSU, Ole Miss, Georgia, etc) ____ Private School (Samford, Harvard, Yale, etc) ____ Trade School/Community College (Jeff State, Shelton State, etc) $115 $166 $518 $75 Slide 4 ExpendituresCost Housing: What kind of house do you see your family living in? ____ New large 3 story house with basement and pool ____ Older 2 story house with a nice yard ____ Garden Home (one level home) with a small yard ____ Apartment $2800 $1600 $1000 $800 Cars: What kind of cars for you, your spouse drive, and 16 year old? How many of each? ____ New Luxury Cars (like Mercedes, BMW, Lexus) ____ New Mid-level Cars (like Honda, Volkswagen, Kia) ____ Slightly Used Car that isnt too old, but runs well ____ Old Used Car that still runs, but is old. $800 each $400 each $250 each $100 each Gas for Each Car You must pay for gas for each of your cars. Gas- # of cars x $100 per car = Savings: Do you want you can do both ____ Vacation at least once a year ($2500 or $200 per month) ____ Christmas/ Birthday Gifts $200 $100 Savings: College Savings for your Kids College 2 kids/ per month ____ Public/4 year/In-state (Alabama, Auburn, UAB, etc) ____ Public/4 year/Out of State (LSU, Ole Miss, Georgia, etc) ____ Private School (Samford, Harvard, Yale, etc) ____ Trade School/Community College (Jeff State, Shelton State, etc) $115 $166 $518 $75 Cell Phones-What types of phones does your family have? ____ Whole family has iPhones with unlimited data and texting ____ Parent- iPhones, Kids- flip phones with texting (no data) ____ Everyone has a flip phone (no data) ____ Parents- flip phones; Kids- no phones ____ No Cell Phones $250 $180 $100 $50 $0 At the Grocery Store ____ Top of the Line- eating the best there is ____ Middle of the Line-Average food/ average cost ____ Thrifty Eating on a budget- cheap stuff $1100 $750 $550 Out to Eat: How many times a month do you go out to eat? ____ At least 2-3 times per week (10 times a month) ____ Once or Twice a week (6 times a month) ____ Less than once a week (3 times a month) ____ Once a month ____ NEVER $500 $300 $150 $50 $0 Cable and Internet Full package- with movie channels, DVR and Internet wifi Standard package with internet Wifi Basic package with internet Cable only Internet Only $220 $175 $125 $75 $50 Non-negotiables you have to pay the following each month Utility Bills: Water, Power, Gas heat $200 Charitable Giving Do you give money to your church? Or to other organizations like Race for the Cure? Humane Society? The Heart association? Total Cost Slide 5 The Real World Now, the moment of truth Your family income for this activity will be the same as the average family in Trussville makes, $80,108 (www.city-data.com).www.city-data.com To figure out your familys monthly income, divide your annual income by 12 --- what is it? So, your family has to make a budget (under the Budget with Income column) with the things you want that doesnt go over $6,675 YOU MUST USE PENCIL FOR THIS ENTIRE ACTIVITY! Imagine your Future Lets say youre married with 2 kids. Your kids are 13 and 16. What do you want? Total Cost Budget with Income Budget with Deductions Here We Go Again Slide 6 Cost Continued Be sure to Tally your total cost! Savings: College Savings for your Kids College ____ Public/4 year/In-state (Alabama, Auburn, UAB, etc) ____ Public/4 year/Out of State (LSU, Ole Miss, Georgia, etc) ____ Private School (Samford, Harvard, Yale, etc) ____ Trade School/Community College (Jeff State, Shelton State, etc) $115 $166 $518 $75 Cell Phones-What types of phones does your family have? ____ Whole family has iPhones with unlimited data and texting ____ Parent- iPhones, Kids- flip phones with texting (no data) ____ Everyone has a flip phone (no data) ____ Parents- flip phones; Kids- no phones ____ No Cell Phones $250 $180 $100 $50 $0 At the Grocery Store ____ Top of the Line- eating the best there is ____ Middle of the Line-Average food/ average cost ____ Thrifty Eating on a budget- cheap stuff $1100 $750 $550 Out to Eat: How many times a month do you go out to eat? ____ At least 2-3 times per week (10 times a month) ____ Once or Twice a week (6 times a month) ____ Less than once a week (3 times a month) ____ Once a month ____ NEVER $500 $300 $150 $50 $0 Non-negotiables you have to pay the following each month Utility Bills-Water, Power, Gas- $200- You have to pay this! Gas- $100 per car- You must pay for gas for each of your cars. Total Cost Tally total Cost! Slide 7 Taxes, Retirement, and Health Care Costs All that is certain in life is death and taxes Benjamin Franklin Slide 8 Why do we have taxes? The government has a lot of expenses Build roads, schools, courthouses, jails, parks, and space shuttles. Fund our military, police officers, firefighters, public servants, teachers, or state and local maintenance workers. Pay for many important services for people and countries in need. In order to pay its bills, the government needs revenue, or a source of income. The money that the federal government uses to pay its bills comes mostly from taxes! Slide 9 Where Does the Governments Money Come From? http://apps.irs.gov/app/understandingTaxes/teacher/downloads.jsp Slide 10 What Does the Government Spend its Money On? http://apps.irs.gov/app/understandingTaxes/teacher/downloads.jsp Slide 11 Types of Taxes If you go to the store and buy a delicious Snickers Bar for $1.00 do you actually pay just $1.00? Nope, youve got to also pay for sales tax. So it probably ends up being about $1.10 But we also pay a lot of other types of taxes. Most of the taxes we pay actually come out of our paychecks before we even get the money. Federal Income Tax State Income Tax Local Income Tax Social Security (FICA) Medicare Slide 12 Income Taxes Income tax is exactly what it sounds like. It is a tax on your income or a tax on the money you make. Your income is taxed by the National Government- pays for the Federal Budget State Government- pays for the States Budget Local Government- pays for your town and/or countys expenses. Other types of deductions come out of your paycheck before you get it as well Slide 13 Social Security Social Security taxes are collected to aid workers who are retired or disabled, or for members of deceased workers families. When you retire, you will receive a Social Security check every month to help pay for your living expenses. But, your Social Security check each month probably wont be enough to maintain your lifestyle, so most people have an alternative savings account to have after they retire. Slide 14 Medicare Medicare taxes help people pay for their health care as they get older. When you get older, you will get sick more often. (Its a fact of life.) Slide 15 Insurance Healthcare is extremely expensive. Almost no one can pay for a trip to the hospital out of their own pocket. It is crucially important to pay for health insurance each month in case something happens. Slide 16 Slide 17 The Tax Man! Now that you know your post-taxes monthly income, you know what is time for Time to Re-Budget! Use the Budget with Deductions Column. Think about your disposable income what can you cut first? Your budget cannot go over $4,473.43 YOU MUST USE PENCIL FOR THIS ENTIRE ACTIVITY! Imagine your Future Lets say youre married with 2 kids. Your kids are 13 and 16. What do you want? Total Cost Budget with Income Budget with Deductions Here We Go Again Slide 18 Budget with Deductions $4473 1) when you finish, answer question 2 and 3 in your reflection Yes, the page number is wrong on #3, you can look at today's notes. 2) Turn in the blue form and your family feud on my desk. Slide 19 ExpendituresCost Housing: What kind of house do you see your family living in? ____ New large 3 story house with basement and pool ____ Older 2 story house with a nice yard ____ Garden Home (one level home) with a small yard ____ Apartment $2800 $1600 $1000 $800 Cars: What kind of cars for you, your spouse drive, and 16 year old? How many of each? ____ New Luxury Cars (like Mercedes, BMW, Lexus) ____ New Mid-level Cars (like Honda, Volkswagen, Kia) ____ Slightly Used Car that isnt too old, but runs well ____ Old Used Car that still runs, but is old. $800 each $400 each $250 each $100 each Gas for Each Car You must pay for gas for each of your cars. Gas- # of cars x $100 per car = Savings: Do you want you can do both ____ Vacation at least once a year ($2500 or $200 per month) ____ Christmas/ Birthday Gifts $200 $100 Savings: College Savings for your Kids College 2 kids/ per month ____ Public/4 year/In-state (Alabama, Auburn, UAB, etc) ____ Public/4 year/Out of State (LSU, Ole Miss, Georgia, etc) ____ Private School (Samford, Harvard, Yale, etc) ____ Trade School/Community College (Jeff State, Shelton State, etc) $115 $166 $518 $75 Cell Phones-What types of phones does your family have? ____ Whole family has iPhones with unlimited data and texting ____ Parent- iPhones, Kids- flip phones with texting (no data) ____ Everyone has a flip phone (no data) ____ Parents- flip phones; Kids- no phones ____ No Cell Phones $250 $180 $100 $50 $0 At the Grocery Store ____ Top of the Line- eating the best there is ____ Middle of the Line-Average food/ average cost ____ Thrifty Eating on a budget- cheap stuff $1100 $750 $550 Out to Eat: How many times a month do you go out to eat? ____ At least 2-3 times per week (10 times a month) ____ Once or Twice a week (6 times a month) ____ Less than once a week (3 times a month) ____ Once a month ____ NEVER $500 $300 $150 $50 $0 Cable and Internet Full package- with movie channels, DVR and Internet wifi Standard package with internet Wifi Basic package with internet Cable only Internet Only $220 $175 $125 $75 $50 Non-negotiables you have to pay the following each month Utility Bills: Water, Power, Gas heat $200 Charitable Giving Do you give money to your church? Or to other organizations like Race for the Cure? Humane Society? The Heart association? Total Cost Slide 20 Savings and Debt Slide 21 Why Save Money? 3 reasons The unexpected will happen. Some day you wont be able to work anymore. If you save now, you can live a better life in the future. Debt is the circumstance of owing money. Slide 22 Savings Options--- INVEST $ Stock - When you own a share of stock, you are a part owner in the company with a claim (however small it may be) on every asset and every penny in earnings. But, your investment is subject to be lost if the company tanks. This means that you can MAKE money or LOSE money! BondsA Bond is simply an 'IOU' in which an investor agrees to loan money to a company or government in exchange for a predetermined interest rate. Bonds generally involve less risk than stocks. http://www.youtube.com/watch?v=TnLeJ62qqCs&safety_mode =true&persist_safety_mode=1 Slide 23 Savings Option--- Save $$ Savings Accounts These are usually the safest option for people trying to save money. Banks will hold your money safely, and even pay you interest for keeping your money at their bank. They use your money to issue loans to other people, but dont worry; the federal government will make sure you get your money back. (FDIC) After the Great Depression, many people hid money in coffee cans or buried money in their back yards b/c they felt banks were unsafe. Slide 24 Managing Money Its important to manage your money properly so that you are able to save money. Checking Account: This is a service provided by banks which allows individuals and businesses to deposit money and withdraw funds from a federally-protected account. People use checking accounts to hold money in a safe place until they use it. We put money that we know we will need to spend soon in these accounts. If you were saving for college would you use a checking or savings account? If you needed to buy groceries would you use a checking or savings account? Slide 25 Credit and Debit Cards Debit Card What it is.. Plastic card that allow electronic access to a persons checking account. How it is paid.. When a purchase is made, money is automatically withdrawn from the checking account. Meaning the money comes straight out of your checking account. If you dont have the money in your account, you cant use your Debit Card. Credit Card What it is.. Plastic card that allows users to purchase items electronically by loaning money from an institution. How it is paid.. Cardholders are billed each month the total amount what was purchased plus interest. If you charge $100, your bill will be more than $100!!! Slide 26 Debit Card Why people use them They are convenient. Its safer than carrying cash. Its faster than writing a check. Why people dont use them Its easy to forget how much is in your account. Overdraft fees- you get charged if you spend more than is in your account! Credit Card Why people use them They are convenient. Its safer than carrying cash. You dont have to pay for the item right away if you dont have enough money. Why people dont use them They are too easy to use. Debt can pile up fast. If you dont pay the balance each month, you pay interest. Slide 27 Credit Cards and Debt Why they are risky. 1.Average Interest Rate: 14.99%... You pay more. So that video game you bought for $60, actually cost more like $70. Why pay the extra money when you can use cash now? 2.You wont get more money next month, but you will have more to pay for. Must adjust your lifestyle to pay off debt. 3.Easy to dig a deep debt hole, extremely difficult to get out. What to do instead: 1.Use cashaccepted everywhere. Plus, a fist full of money looks cooler than a credit card. 2.Use a debit card or checkbook. 3.If you must use a credit card, treat it like a debit card. Record all of your purchases and balance your finances. Slide 28 Lets Test Your Knowledge. Answer Debit or Credit. The money I spend with this card comes directly from my bank account. DEBIT The money I spend with this card is a loan from the bank or from a credit card company. CREDIT I must have enough money in my checking /savings account to pay for my purchase in order to use this card. DEBIT Because interest is charged on my unpaid balance with this card, I may pay more for items I purchase with this card than if I pay cash. CREDIT I can set up a payment plan with the card company if I cant pay for all of my purchases at the end of the month. CREDIT Slide 29 1. Sit with your partner 2. Get out your NB#33 Notes Slide 30 Unemployment Slide 31 Unemployment Mini-Lesson Start 22 seconds in to the clip http://www.youtube.com/watch?v=_CdTu1pk06w&safety_mod e=true&persist_safety_mode=1 Slide 32 Fired Sometimes people lose their jobs because they dont do a good job. That is usually called getting fired. Slide 33 Laid Off Other times though, and what happens a lot these days, is that people lose their jobs even if they were great at it. If your job is no longer there because of a shrinking economy, that is called a LAY-OFF. The more people that are unemployed, the fewer people there are to buy things like TVs. This isnt good for families and it isnt good for the country. Slide 34 Unemployment Continued. During times like this, when the economy is shrinking and lots of people are out of work this is known as a recession. It isnt easy to just find a new job. The overall number of jobs decreases and the amount of people looking for jobs increases. Slide 35 Unemployment Mini-Lesson Slide 36 Current Unemployment Slide 37 Unemployment Rate Chart Slide 38 Unemployment rate by State This map shows unemployment rates as of September 2012. They have decreased since September. Slide 39 Unemployment Hits Home! Sad Day Your monthly income is about to be cut in half. You and your spouse were what we call a dual income family. One of you just lost your job. Instead of making $80,108 a year, you now only make $40,054. Remember, to figure out your familys monthly income, divide your annual income by 12. That would give you $3,337.50 But, dont forget taxes!!! Your family has to make a budget (under the Here We go Again column) with the things you want that doesnt go over $2,236.71 Remember to USE A PENCIL! Imagine your Future Lets say youre married with 2 kids. Your kids are 13 and 16. What do you want? Total Cost Budget with Income Budget with Deductions Here We Go Again Slide 40 ExpendituresCost Housing: What kind of house do you see your family living in? ____ New large 3 story house with basement and pool ____ Older 2 story house with a nice yard ____ Garden Home (one level home) with a small yard ____ Apartment $2800 $1600 $1000 $800 Cars: What kind of cars for you, your spouse drive, and 16 year old? How many of each? ____ New Luxury Cars (like Mercedes, BMW, Lexus) ____ New Mid-level Cars (like Honda, Volkswagen, Kia) ____ Slightly Used Car that isnt too old, but runs well ____ Old Used Car that still runs, but is old. $800 each $400 each $250 each $100 each Gas for Each Car You must pay for gas for each of your cars. Gas- # of cars x $100 per car = Savings: Do you want you can do both ____ Vacation at least once a year ($2500 or $200 per month) ____ Christmas/ Birthday Gifts $200 $100 Savings: College Savings for your Kids College 2 kids/ per month ____ Public/4 year/In-state (Alabama, Auburn, UAB, etc) ____ Public/4 year/Out of State (LSU, Ole Miss, Georgia, etc) ____ Private School (Samford, Harvard, Yale, etc) ____ Trade School/Community College (Jeff State, Shelton State, etc) $115 $166 $518 $75 Cell Phones-What types of phones does your family have? ____ Whole family has iPhones with unlimited data and texting ____ Parent- iPhones, Kids- flip phones with texting (no data) ____ Everyone has a flip phone (no data) ____ Parents- flip phones; Kids- no phones ____ No Cell Phones $250 $180 $100 $50 $0 At the Grocery Store ____ Top of the Line- eating the best there is ____ Middle of the Line-Average food/ average cost ____ Thrifty Eating on a budget- cheap stuff $1100 $750 $550 Out to Eat: How many times a month do you go out to eat? ____ At least 2-3 times per week (10 times a month) ____ Once or Twice a week (6 times a month) ____ Less than once a week (3 times a month) ____ Once a month ____ NEVER $500 $300 $150 $50 $0 Cable and Internet Full package- with movie channels, DVR and Internet wifi Standard package with internet Wifi Basic package with internet Cable only Internet Only $220 $175 $125 $75 $50 Non-negotiables you have to pay the following each month Utility Bills: Water, Power, Gas heat $200 Charitable Giving Do you give money to your church? Or to other organizations like Race for the Cure? Humane Society? The Heart association? Total Cost Slide 41 NOW youre finished Complete your reflection. Turn in your Family Feud Budget sheet Turn in your blue price sheet Turn in your reflection KEEP YOUR NOTES IN YOUR BINDER. ADVANCED CLASSES Web Quest is due Monday.