1. Warm Up 1.If Ottis has a salary of $47,560 per year how much should he estimate his monthly earnings to be? How much are his weekly earnings? How much would he earn bi-weekly? 2.What tools can I use to help me estimate the amount saved each time period? Essential Question: How can the student graph and use the line of best fit to help establish a plan to save? © Council for Economic Education Slide 1

2. What is Earned Income? Money received for work performed; may include salary, wages, tips, professional fees, commissions, etc. © Council for Economic EducationSlide 2

3. What is Saving? Disposable income (income after taxes) minus consumption spending (money spent on goods and services) © Council for Economic Education Slide 3

4. What Career is Right for me? Please go to this site: http://www.whatcareerisrightforme.com/care er-aptitude-test.php http://www.whatcareerisrightforme.com/care er-aptitude-test.php Once you are done the test choose a career that interests you. Write down the “Annual Median Wage” at the top of Activity 1 and insert it in the box in the interactive © Council for Economic EducationSlide 4

5. General Manager MonthSaving 00 12$55,050 © Council for Economic Education Slide 5

6. Yearly Saving (Without Interest) © Council for Economic Education Slide 6

7. Calculating Rate of Change Change of the “OUT” or the Y Change of the “IN” or the X $55,050 - 0 12 - 0 $4,587.50 (monthly saving/earning) © Council for Economic EducationSlide 7

8. CareerYearly SalaryMonthly Income Tax RateMonthly Income after taxes Monthly Income after taxes and expenses General Manager$55,050$4,587.50 © Council for Economic Education Slide 8

9. Income Tax and FICA/Medicare Brackets 10% taken out of earnings $0-$8,925 15% taken out of earnings $8,926-$36,250 25% taken out of earnings $36,251-$87,850 30% taken out of earnings $87,851-$183,250 © Council for Economic Education Slide 9

10. CareerYearly SalaryMonthly Income Tax RateMonthly Income after taxes Monthly Income after taxes and expenses General Manager$55,050$4,587.5025% © Council for Economic Education Slide 10

11. Calculating monthly disposable income (Income with taxes taken out) $55,050 (Yearly Wage) x 0.75 (1.00 - 0.25) (Which is 100 percent minus the 25 percent tax rate.) $41,287.50 (New yearly wage minus taxes) OR $55,050 $55,050.00 x.25 (Taxes percent) -13,762.50 $13,762.50 (Amount taken out for taxes) $41,287.50 © Council for Economic Education Slide 11

12. Range of Monthly Expenses Based on your yearly salary, you will spend more money a month on expenses. Yearly Salary RangeMonthly Expenses $0 - 24,999$1,200 $25,000 - 39,999$1,600 $40,000 - 54,999$2,000 $55,000 - 69,999$2,400 $70,000 - 84,999$2,600 $85,000 - 99,999$3,000 $100,000 - 119,999$3,400 $120,000 & up$3,800 © Council for Economic Education Slide 12

13. Figuring out monthly savings $41,287.50/12 (Months) = $3,440.62 (round to nearest dollar) $3,441.00 (monthly earnings after taxes) - 2,400.00 (monthly expenses) $1,041.00 (new monthly saving) © Council for Economic Education Slide 13

14. CareerYearly SalaryMonthly IncomeTax RateMonthly Income after taxes Monthly Income after taxes and expenses General Manager$55,050$4,587.5025%$3,441.00$1,041.00 © Council for Economic Education Slide 14

15. Playing Game of Mystfortune MonthSaving(s) 0$0 1$141.00 2$1,212.00 3 4 5 6 7 8 9 10 11 12 Month 1 $1,041.00 (Income minus taxes and expenses) -900.00 (Unexpected expense – going out and car repair) $141.00 (Saving= what is left) Month 2 $1,041.00 (Income minus taxes and expenses) + 75.00 (coupon clipping) $1,116.00 (Amount left {saving}) - 45.00 (Cell phone overage) $1,071.00 (Total saved just in month 2) + 141.00 (Total saved in month 1) $1,212.00 (Month 2 entry) © Council for Economic EducationSlide 15 http://technology.councilforeconed.org/wheel -of-mystfortune

16. CareerYearly SalaryMonthly IncomeTax RateMonthly Income after taxes Monthly Income after taxes and expenses General Manager$55,050$4,587.5025%$3,441.00$1,041.00 © Council for Economic Education Slide 16

17. © Council for Economic EducationSlide 17 Yearly Savings

18. Line of Best Fit (5,3834) © Council for Economic Education Slide 18

19. New rate of change $5,411 - $3,834 7 - 5 New slope, based on two points from the line of best fit, is 788.5. © Council for Economic EducationSlide 19

20. Closure Questions: How can we define earned income, disposable income, taxes, saving, savings, expenses and budget? How can we find line of best fit? How can we find the rate of change? What are some unforeseen events that we need to save for? If Henry earns $35,000 a year and gets 15% taken out for taxes, how much is his disposable income? Given the points (3,474) & (10,789), what is the rate of change? How can you use a graph and the line of best fit to help use establish a plan to save? © Council for Economic Education Slide 20