Chapter 4 Financial Decisions and Planning

Slide 2 What Is the Purpose of Budgeting? A budget is a spending and saving plan. It is based on estimated income and expenses. Use spreadsheet software to prepare a budget. 4-2 Basics of Budgeting

Slide 3 How Do You Prepare a Budget? 4-2 Basics of Budgeting Step 1: Estimate income Step 2: Plan savings Step 3: Estimate expenses o Variable expenses o Fixed expenses o Charitable giving Step 4: Balance the budget

Slide 4 Personal Budget 4-2 Basics of Budgeting IncomeWeeklyMonthlyYearly Work (part-time)$30.00$120.00$1, Allowance for household chores Lunch money allowance Savings account interest Total income $55.50$222.00$2, Savings Deposit to savings account$ 5.50$ $ Expenses Gifts$ 5.00$ 20.00$ Clothes and shoes Loan payment to parents Lunches Entertainment/miscellaneous Total expenses$50.00$200.00$2, Total savings and expenses $55.50 $222.00$2,664.00

Slide 5 Focus On... Philanthropy Philanthropy is a form of charitable giving. It supports a societal cause. It often lasts for an extended period of time. It is the primary source of funding for the fine arts, performing arts, and most religious and humanitarian causes. 4-2 Basics of Budgeting

Slide 6 Success Skills Dealing With Conflict 4-2 Basics of Budgeting Stop and take a ten-second time out. o Ask “what is happening here?” o Listen rather than talk. Suggest that you continue your talk later. Focus on the problem, not the person. Be objective. Be willing to compromise when appropriate.