Transportation Groceries Gas/Fuel Home Insurance Car Insurance Education Rent/Mortgage Utilities Child Care Medical Emergency Fund

 In order to plan for the future, you need a budget. Take Simon, a grade 12 student working part time. His budget looks like this: INCOME ($)EXPENSES ($) Week College Savings200 Week Insurance123 Week Fuel75 Week Entertainment100 Total707.98Total498 Balance (Income – Expenses) = – 498 = According to this balanced budget, Simon is able to save just over $200 a month

 Every year, expenses go up, for example:  Car Insurance increases by 5%  Grocery Expenses increase by 10%  Home Heating Costs rise 15%  Simon’s budget was simple, as the only expenses he had were:  College Savings  Insurance  Fuel  Entertainment  Let’s look at what a family budget would look like.

INCOME ($) Spouse Spouse Total6100 EXPENSES ($) Fixed ExpensesVariable Expenses (Average) Mortgage & Property Tax2040Groceries800 House Insurance32Electricity120 Car Insurance188Heating220 Life Insurance500Water65 Long-Term Savings580Telephone35 RESPs400Internet35 Cable Television30 Medical170 Clothing150 Home Repair Account200 Charities50 Entertainment200 Vacation Amount200 Children’s Accounts150 Gift Account100 Total Fixed3640Total Variable2460 Total Expenses6100

 Expenses change over time, so one must be prepared to re-balance a budget  What if expenses go up as discussed before?  Car Insurance increases by 5%  Grocery Expenses increase by 10%  Home Heating Costs rise 15%  The couple would have to rebalance their budget  Which expenses would they have to modify?  Variable Expenses

 p. 472 #1, 3, 6