Financial Literacy: Introduction and Financial Management Mr. Ervin East Hardin Middle School

What is financial literacy? Knowing how to handle your finances. Money is how our society measures economic value. We exchange money for goods and services. We expect money in return for labor.

Freedom!…Maybe Having your own money gives you freedom. You’re in charge. BUT as you get older, you’ll learn the risks and responsibilities that come along with money. You can’t always buy what you want! While it’s fun to spend money, you must learn to save.

Financial Management Taking care of your money so that you can pay for your needs and as many of your wants as possible. This requires a budget. Set realistic limits on spending. Includes: Income, Expenses and Savings

Budget TOTALS MUST MATCH Income Money received or earned. Expense (fixed and flexible) Money spent. Saving Money set aside for future expense. TOTALS MUST MATCH

Family Budget Savings Housing Utilities Transportation (car payment, insurance) Charity School Lunch Food Clothing Medical Entertainment Allowances

Individual Budget Income Expense Allowance, Earnings, Gift College Fund Spending Monet Donation Flexible Saving/Spending Savings

Individual Budget Activity Open a Microsoft Word Document and write down TWO short-term and TWO long-term financial goals. Create a sample monthly budget using a $200 income. You must have at least 2 sources of income and at least 3 expense categories.