Marriage Unit: Budgeting 101

Marriage Unit: Multiple Finances Successful Marriages/Relationships require respect, compromise, and team work! Combined Income “With greater power comes greater responsibility” Important to remember financial decisions can effect more than just yourself

Marriage Unit: Budgeting 101 Big difference between WANTS vs NEEDS WANTS include items that are not a necessity, luxury to own Examples: Snowmobile, Netflix, Ipad, etc. NEEDS include items that are essential for living Examples: Heat/Air Conditioning, Food, Rent Money

Marriage Unit: Income and Deductions Gross Income – All the money you make before deductions have been made for taxes, social security, health insurance, etc. Net Income – Take home pay, after all deductions have been made Income Tax – Government levy on tax payers, amount varies depending on the amount of income (State and Federal) Use 30% income tax for equations

Marriage Unit: Calculating Hourly Income Montana Minimum Wage $8.05 per hour Full time: 40 hours per week Gross Pay: Hourly Wage x 40 hrs x 4 weeks Example Gross Pay & Net Pay $8.05 x 40 hours per week x 4 weeks: ??

Marriage Unit: Calculating Income Salary job is based on a 12 month period Does not take into account hours per week Monthly Gross Pay: Salary / 12 months Monthly Net Pay: Gross Pay x Income Tax Gross Pay – Income Tax $$ Example using National Average: $45,000

Marriage Unit: Employer Benefits Employers will provide benefits or ‘Salary Packaging’ Compensate cash wages with various benefits Usually cheap rates with company/business rather than individual Examples: Vision Medical Insurance Paid Time Off (PTO) Sick Leave Dental Insurance Retirement Plans

M.U.: Education Income Averages High School Dropout – $22,000 High School Diploma - $30,000 Associates Degree (2 years of College) – $38,000 Bachelors Degree (4 years of College) - $49,000 Masters Degree (2 years beyond Bachelors) – $60,000 Doctorate Degree - $110,000

Bachelors Degree: Earned twice as much as those without a high school diploma 62 percent more than high school diploma 29 percent more than associate's degree Master’s degree: 23 percent more than median earnings for young adults with a bachelor's degree

Calculate! Calculate the Net Monthly Income for each Education Income Average category (HS dropout, HS diploma, Associates Degree, etc.) SHOW ALL WORK Label the Gross Income, Income Tax, and Net Salary when working out your problems