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Budgets 101: How to Get It Done LESSON 9: STUDENT ACTIVITY SHEET 2 STUDENT TIP Divide Your Expenses: Determine the cost for each category and record the prices in your budget. Use the following percentages to divide your monthly net pay: Rent: 30% of net pay Utilities 10% of net pay Car Insurance: 5% of net pay Cell Phone: 5% of net pay Occasional Spending:10% of net pay Savings: 10% of net pay Food: 15% of net pay Car Loan: 10% of net pay Entertainment: 5% of net pay You may have to make some adjustments based on your preferences. For example, you want more money for entertainment, can you afford to cut back on rent or your car loan? Or, ifyou want to live in an urban area where rentis higher can you cut back on mother expense to afford ? Assess Your Budget: Compare your expenses to your monthly income. Have you spent everything you've earned? Do you have money left over for savings? What expenses could you lower to increase your savings? Net Income: /month Cost Fixed Expenses Variable Expenses Total Time Required: 15 minutes Money Matters: Know the Lingo LESSON 1: STUDENT ACTIVITY SHEET 1 Do you ever feel like money terms go right over your head? The reality is that you probably already know and use a lot of financial vocabulary. Read through the terms below and think about how they connect to your life. Terms to know How Does This Relate to Me? When have you used cost comparison? Cost Comparison Comparing the cost of two or more goods or services in an effort to find the best value Provide an example Cost-Benefit Analysis Analyzing whether the cost of an item is more than, equal to, or less than the benefit that comes from purchasing that item. Cost - The price paid for a good or service Benefit-An outcome that promotes well-being. When have you used cost-benefit analysis Provide an example: identify something you want to do or purchase What is the cost? What is the benefit Calculating Future Expenses Identifying the cost of meeting future needs and goals. Short-term, medium-term and long-term goals - Goals to achieve over specific periods of time. identify 3 personal goals. Think about what is needed to accomplish each goal Short-term goal: Medium-term goal: Long-term goat Choose one of your goals from above and estimate its expense. How much Income do you estimate will be needed to support your goal? Goal: Budget A plan for future spending and saving. weighing estimated income against estimated expenses. Income - Payment received for goods or services, including employment. Expense - Costpaid to secure a good or service Estimated (monetary) expense: _ Estimated income needed: STUDENT ACTIVITY MONEY MATTERS