Personal Finance and Resource Management Objective 2.02

Money Management/Budget Money management is when you use your wisely planned budget to help you see how much money you have and how/where you spend your money. A budget is a written plan for spending your money wisely. To set a budget you should examine your goals and include a savings plan. You will need to know your income and expenses.

Types of Expenses Fixed Expenses are expenses for which a set amount of money must be paid regularly, such as rent, insurance or tuition. Flexible Expenses are expenses that vary in amount and do not occur on a regular basis, such as food, transportation, or entertainment.

Your Resources Resources are assets that can be used to meet needs and fulfill wants. Types of Resources Human Resources are the qualities and traits people have within themselves to get what they need or want. Also called personal resources. Ex: knowledge, skills, talents, health, energy, time, personality, creativity and work habits.

Your Resources cont… Nonhuman Resources are the objects and conditions available to people to help meet needs and fulfill wants. Also it includes material and environmental resources. Material Resources are the objects you own (DVD, money, clothes, phone) Environmental Resources are assets found in nature (water, air, soil)

Your Resources cont… Private Resources are resources owned and controlled by a person or a family (income, houses, cars). Community Resources are resources shared by everyone and paid for through taxes. Also called public resources.

Time Management If you have good time management skills you are good at organizing your time in order to accomplish tasks. Time and energy are the 2 most valuable resources!!

Planning Your Time A Daily Schedule Schedule/Calendar (written plan for reaching your goals) Avoid wasting time Procrastinate (to put off difficult or unpleasant tasks until later)

Improving Your Study Habits Have a place to study Plan a study schedule

Managing Your Energy Be sure to eat the right foods in order to have enough energy to get your through your daily activities. Be sure to get at least 8 hours of sleep a night so that you will have the energy you need the next day. Be sure to be physically active at least 30 minutes a day to increase your energy level.

Credit and Debit Credit (or a credit card) is a loan that a person uses to pay for things, but is expected to pay back. You will be charged interest on your credit which is the amount of money the borrower pays for the use of a lender’s money. A debit (or a debit card) electronically withdraws money from a person’s checking account.

Paying for Purchases You can write a check. A check is a written order directing a bank to pay the person or business named on the check. You have to have a checking account in order to write checks. You can pay on a layaway plan. A layaway plan is a scheduled payment plan in which you pay a small amount of money down and make regular payments until you have paid for the item. You can also use a credit or debit card or CASH!

Insurance & Risk Management Insurance is a protection plan to manage personal or household risks. A risk is an activity or action that might be dangerous. Risk management are the actions you take to make risks less dangerous or not dangerous at all. Risk prevention are the actions you take to stop consequences of risks from happening.

Savings and Investing A savings is the money you set aside for short-term or long-term goals. A budget is a spending and savings plan. Expense is the cost of goods and services needed. Interest is the amount of money the borrower pays for the use of a lender’s money.