Managing Your Money: The Importance of Budgeting

 
LESSON 4
BACK TO SCHOOL
 
L
E
S
S
O
N
 
O
B
J
E
C
T
I
V
E
S
 
LESSON 4: BACK TO SCHOOL
 
STUDENTS WILL
:
 
1.
EXPLAIN AND USE THE VOCABULARY ASSOCIATED WITH BUDGETING.
 
2.
IDENTIFY THE PURPOSE OF A BUDGET.
 
3.
IMPLEMENT THE BUDGETING STEPS.
2
 
B
A
C
K
 
T
O
 
S
C
H
O
O
L
 
5
 
Lesson 4
: 
Back to School
 
A
S
S
E
S
S
I
N
G
 
T
H
E
 
I
M
P
A
C
T
 
O
F
 
F
I
N
A
N
C
I
A
L
P
R
E
P
A
R
E
D
N
E
S
S
 
What did Jamie’s friends recommend in
order to be financially prepared?
How was Jamie able to use the money she
had earned and saved?
How might having a budget help you
achieve your financial goals?
How might getting a good education help
ensure your financial future?
 
4
 
Lesson 4
: 
Back to School
 
5
B
U
D
G
E
T
I
N
G
 
M
A
N
A
G
I
N
G
 
Y
O
U
R
 
M
O
N
E
Y
:
 
T
H
E
 
B
U
D
G
E
T
 
WHAT IS A BUDGET?
A budget is a plan that helps you manage your money by helping
you balance your income with your expenses.
It is an itemized summary of probable income and expenses for a
given period.
WHY CREATE A BUDGET?
A budget helps you understand where your money goes.
It helps you live within your means and meet your goals.
It helps you find uses for your money that will increase your wealth.
It puts you in control of your money.
 
 
6
 
Lesson 4
: 
Back to School
 
M
A
N
A
G
I
N
G
 
Y
O
U
R
 
M
O
N
E
Y
:
 
T
H
E
 
B
U
D
G
E
T
D
e
t
e
r
m
i
n
e
I
n
c
o
m
e
I
d
e
n
t
i
f
y
 
E
x
p
e
n
s
e
s
&
 
T
r
a
c
k
 
S
p
e
n
d
i
n
g
D
e
v
e
l
o
p
 
t
h
e
B
u
d
g
e
t
 
P
l
a
n
I
m
p
l
e
m
e
n
t
&
 
T
r
a
c
k
R
e
v
i
e
w
 
&
 
A
d
j
u
s
t
 
7
 
Lesson 4
: 
Back to School
 
T
H
E
 
B
U
D
G
E
T
:
 
D
E
T
E
R
M
I
N
E
 
I
N
C
O
M
E
 
Calculate your income.
Identify all income sources.
Wages/salaries
Gifts or allowance
Interest
Scholarships, grants, and student aid
Understand the difference between net and gross income.
 
8
D
e
t
e
r
m
i
n
e
I
n
c
o
m
e
 
Lesson 4
: 
Back to School
 
DETERMINING YOUR EXPENSES
Consider all expenses.
Determine which are fixed and which are variable expenses.
EXPENSE CONSIDERATIONS
Know what you owe.
Consider your ongoing needs.
Plan other expenditures.
Identify how much money you need to cover expenses.
Expect the unexpected.
 
 
 
 
9
 
T
H
E
 
B
U
D
G
E
T
:
 
I
D
E
N
T
I
F
Y
 
E
X
P
E
N
S
E
S
 
A
N
D
T
R
A
C
K
 
S
P
E
N
D
I
N
G
I
d
e
n
t
i
f
y
 
E
x
p
e
n
s
e
s
&
 
T
r
a
c
k
 
S
p
e
n
d
i
n
g
 
Lesson 4
: 
Back to School
 
WHERE DID YOUR MONEY GO?
 
Example purchase
On what?
 
A large caramel latte
Where? 
 
Specialty coffee store
How much?
 
$4.75
How paid?
 
Cash
 
 
T
R
A
C
K
I
N
G
 
Y
O
U
R
 
E
X
P
E
N
S
E
S
 
10
 
Lesson 4
: 
Back to School
 
A
C
T
I
V
I
T
Y
:
 
T
R
A
C
K
I
N
G
 
Y
O
U
R
 
E
X
P
E
N
S
E
S
 
TRACK DAILY EXPENSES 
FOR THE PAST TWO DAYS
 
11
 
Lesson 4
: 
Back to School
 
DEBRIEFING
What types of goods and services did you purchase?
What types of payment methods did you use?
Did the way you paid affect how much you spent?
Which expenses were fixed and which were variable?
Any surprises regarding how much you spent?
What income did you have that paid for these expenses?
Did tracking make you rethink any of your purchases?
What influenced your spending—people, situation, emotion?
How did the purchase make you feel? What about now?
 
12
 
A
C
T
I
V
I
T
Y
:
 
T
R
A
C
K
I
N
G
 
Y
O
U
R
 
E
X
P
E
N
S
E
S
 
Lesson 4
: 
Back to School
 
Information already gathered:
Income
Fixed and variable expenses
 
Other considerations:
Pay yourself first—savings
Consider your goals
Budget shortfalls
 
 
 
13
 
T
H
E
 
B
U
D
G
E
T
:
 
D
E
V
E
L
O
P
 
T
H
E
B
U
D
G
E
T
 
P
L
A
N
D
e
v
e
l
o
p
 
t
h
e
B
u
d
g
e
t
 
P
l
a
n
 
Lesson 4
: 
Back to School
How much money do you get each month?
 
 
Income
    
$2,000
 
What expenses do you have each month?
 
 
Fixed Expenses
 
Rent
    
$   600
 
Cell Phone
   
$     40
 
Car insurance ($300/quarter)
  
$   100
 
 
Variable Expenses
 
Food (estimate)
   
$   500
 
Utility bills (estimate)
  
$     50
 
Gas
                                                                                       
$     50
 
 
Total Expenses
   
$1,540
 
C
R
E
A
T
E
 
A
 
B
U
D
G
E
T
Income
Fixed Expenses
Variable Expenses
 
14
 
Lesson 4
: 
Back to School
 
A
C
T
I
V
I
T
Y
:
 
B
U
D
G
E
T
 
S
C
E
N
A
R
I
O
S
 
In this activity, you will work in groups to allocate $2,000 to a
monthly budget estimate.
You will then take turns drawing scenario cards to see how
close you came to estimating expenses.
Once you have drawn all of the cards, answer the questions
at the bottom of the worksheet.
 
 
 
 
15
 
Lesson 4
: 
Back to School
A
C
T
I
V
I
T
Y
:
 
B
U
D
G
E
T
 
S
C
E
N
A
R
I
O
S
 
$2,000
 
$250
 
$450
 
$100
 
$25
 
$75
 
$200
 
$125
 
$75
 
$25
 
$325
 
$10
 
$75
 
$100
 
$75
 
$75
 
$1,225
 
$760
 
$1,985
 
$15
16
Lesson 4
: 
Back to School
 
A
C
T
I
V
I
T
Y
:
 
B
U
D
G
E
T
 
S
C
E
N
A
R
I
O
S
 
DEBRIEFING
How did your group’s estimates differ from the
scenarios?
How much did you estimate as savings each month?
Were there expenses on this budget that were not listed
in the categories provided?
If you had to pay for these expenses, where would the
money come from?
 
 
 
 
 
17
 
Lesson 4
: 
Back to School
 
T
H
E
 
B
U
D
G
E
T
:
 
I
M
P
L
E
M
E
N
T
 
A
N
D
 
T
R
A
C
K
 
Implement the budget.
Continue to track spending.
 
18
I
m
p
l
e
m
e
n
t
&
 
T
r
a
c
k
 
Lesson 4
: 
Back to School
 
T
H
E
 
B
U
D
G
E
T
:
 
R
E
V
I
E
W
 
A
N
D
 
A
D
J
U
S
T
 
Review
 the budget at least monthly.
Make necessary 
adjustments
 for your situation.
Consider the following in your review:
Have income sources changed?
Does your income cover your expenses?
Where and when are you spending money?
Are you saving regularly?
Has anything affected your income, spending, and saving?
 Are you achieving your personal and financial goals?
 
19
R
e
v
i
e
w
 
&
 
A
d
j
u
s
t
 
Lesson 4
: 
Back to School
I
N
 
S
U
M
M
A
R
Y
 
Budgeting puts you in control of your money and helps you understand
the allocation of your income.
20
Lesson 4
: 
Back to School
Katrina’s Classroom
 was developed by a team of
Senior Economic and Financial Education Specialists at the Federal Reserve Bank of Atlanta.
Claire Loup, New Orleans Branch 
 
Julie Kornegay, Birmingham Branch 
 
Jackie Morgan, Nashville Branch
For additional classroom resources and professional development opportunities,
please visit www. frbatlanta.org/education
 
21
Slide Note
Embed
Share

Understanding the financial impact of preparing a budget is crucial for effective money management. Lesson 4: Back to School focuses on teaching students how to create and implement a budget to achieve their financial goals. By explaining budgeting vocabulary, identifying the purpose of a budget, and outlining steps to manage finances, students can gain control over their money, live within their means, and work towards increasing their wealth. This lesson emphasizes the significance of budgeting in helping individuals track income, expenses, and savings effectively.


Uploaded on Jul 20, 2024 | 0 Views


Download Presentation

Please find below an Image/Link to download the presentation.

The content on the website is provided AS IS for your information and personal use only. It may not be sold, licensed, or shared on other websites without obtaining consent from the author. Download presentation by click this link. If you encounter any issues during the download, it is possible that the publisher has removed the file from their server.

E N D

Presentation Transcript


  1. LESSON 4 BACK TO SCHOOL

  2. LESSON 4: BACK TO SCHOOL LESSON OBJECTIVES STUDENTS WILL: 1.EXPLAIN AND USE THE VOCABULARY ASSOCIATED WITH BUDGETING. 2.IDENTIFY THE PURPOSE OF A BUDGET. 3.IMPLEMENT THE BUDGETING STEPS. 2

  3. Lesson 4: Back to School BACK TOSCHOOL 5

  4. Lesson 4: Back to School ASSESSING THE IMPACT OF FINANCIAL PREPAREDNESS What did Jamie s friends recommend in order to be financially prepared? How was Jamie able to use the money she had earned and saved? How might having a budget help you achieve your financial goals? How might getting a good education help ensure your financial future? 4

  5. BUDGETING 5

  6. Lesson 4: Back to School MANAGING YOUR MONEY: THE BUDGET WHAT IS A BUDGET? A budget is a plan that helps you manage your money by helping you balance your income with your expenses. It is an itemized summary of probable income and expenses for a given period. WHY CREATE A BUDGET? A budget helps you understand where your money goes. It helps you live within your means and meet your goals. It helps you find uses for your money that will increase your wealth. It puts you in control of your money. 6

  7. Lesson 4: Back to School MANAGING YOUR MONEY: THE BUDGET Determine Income Review & Adjust Implement & Track Identify Expenses & Track Spending Develop the Budget Plan 7

  8. Lesson 4: Back to School THE BUDGET: DETERMINE INCOME Calculate your income. Identify all income sources. Wages/salaries Gifts or allowance Interest Scholarships, grants, and student aid Understand the difference between net and gross income. Determine Income 8

  9. Lesson 4: Back to School THE BUDGET: IDENTIFY EXPENSES AND TRACK SPENDING DETERMINING YOUR EXPENSES Consider all expenses. Determine which are fixed and which are variable expenses. EXPENSE CONSIDERATIONS Identify Expenses & Track Spending Know what you owe. Consider your ongoing needs. Plan other expenditures. Identify how much money you need to cover expenses. Expect the unexpected. 9

  10. Lesson 4: Back to School TRACKING YOUR EXPENSES WHERE DID YOUR MONEY GO? Example purchase On what? Where? How much? How paid? A large caramel latte Specialty coffee store $4.75 Cash 10

  11. Lesson 4: Back to School ACTIVITY: TRACKING YOUR EXPENSES TRACK DAILY EXPENSES FOR THE PAST TWO DAYS Item Purchased/ Expense Payment Method Cash, Check, ATM/Debit Card, Credit Card, Autodraft, etc. Fixed or Variable Expense Date Amount 10/1 Car payment $250 Autodraft Fixed 10/1 Gas $40 Debit card Variable 10/2 Car insurance $150 Check Fixed 10/2 Lunch $5 Cash Variable 11

  12. Lesson 4: Back to School ACTIVITY: TRACKING YOUR EXPENSES DEBRIEFING What types of goods and services did you purchase? What types of payment methods did you use? Did the way you paid affect how much you spent? Which expenses were fixed and which were variable? Any surprises regarding how much you spent? What income did you have that paid for these expenses? Did tracking make you rethink any of your purchases? What influenced your spending people, situation, emotion? How did the purchase make you feel? What about now? 12

  13. Lesson 4: Back to School THE BUDGET: DEVELOP THE BUDGET PLAN Information already gathered: Income Fixed and variable expenses Develop the Budget Plan Other considerations: Pay yourself first savings Consider your goals Budget shortfalls 13

  14. Lesson 4: Back to School CREATE A BUDGET How much money do you get each month? Income Income $2,000 What expenses do you have each month? Fixed Expenses Rent Cell Phone Car insurance ($300/quarter) Fixed Expenses $ 600 $ 40 $ 100 Variable Expenses Food (estimate) Utility bills (estimate) Gas Variable Expenses $ 500 $ 50 $ 50 Total Expenses $1,540 14

  15. Lesson 4: Back to School ACTIVITY: BUDGET SCENARIOS In this activity, you will work in groups to allocate $2,000 to a monthly budget estimate. You will then take turns drawing scenario cards to see how close you came to estimating expenses. Once you have drawn all of the cards, answer the questions at the bottom of the worksheet. 15

  16. Lesson 4: Back to School ACTIVITY: BUDGET SCENARIOS Income Net income Estimate Actual $2,000 Fixed Expenses Rent $450 $25 Renter s insurance Automobile loan payment Automobile insurance Medical insurance Student loan Total Fixed Expenses $250 $75 $100 $325 $1,225 Variable Expenses $200 $75 Groceries Dining out Utilities Gasoline Car maintenance Clothing and personal upkeep Gifts Entertainment Savings Total Variable Expenses $125 $75 $75 $25 $100 $10 $75 $760 $1,985 $15 Total Expenses SURPLUS (DEFICIT) 16

  17. Lesson 4: Back to School ACTIVITY: BUDGET SCENARIOS DEBRIEFING How did your group s estimates differ from the scenarios? How much did you estimate as savings each month? Were there expenses on this budget that were not listed in the categories provided? If you had to pay for these expenses, where would the money come from? 17

  18. Lesson 4: Back to School THE BUDGET: IMPLEMENT AND TRACK Implement the budget. Implement & Track Continue to track spending. 18

  19. Lesson 4: Back to School THE BUDGET: REVIEW AND ADJUST Review the budget at least monthly. Review & Adjust Make necessary adjustments for your situation. Consider the following in your review: Have income sources changed? Does your income cover your expenses? Where and when are you spending money? Are you saving regularly? Has anything affected your income, spending, and saving? Are you achieving your personal and financial goals? 19

  20. Lesson 4: Back to School IN SUMMARY Budgeting puts you in control of your money and helps you understand the allocation of your income. 20

  21. Katrinas Classroom was developed by a team of Senior Economic and Financial Education Specialists at the Federal Reserve Bank of Atlanta. Claire Loup, New Orleans Branch Julie Kornegay, Birmingham Branch Jackie Morgan, Nashville Branch For additional classroom resources and professional development opportunities, please visit www. frbatlanta.org/education 21

Related


More Related Content

giItT1WQy@!-/#giItT1WQy@!-/#giItT1WQy@!-/#giItT1WQy@!-/#giItT1WQy@!-/#giItT1WQy@!-/#giItT1WQy@!-/#giItT1WQy@!-/#giItT1WQy@!-/#