1. Individuals and Decision Making

2. Starter: Turn to page 564 do numbers 1-13. Write the answers only. This will be turned in for a class work grade.

3. (notes) Steps in Financial Planning Set Smart Goals Analyze Information Create a Plan Implement the plan Monitor and Modify the plan

4. (notes) Smart Goal Examples 1. Short Term -save $25 by the 10 th of next month to buy mom a birthday present 2. Intermediate Term - Save $10 a week for the next six months buy a prom dress 3. Long-Term -Save $2,000 from a summer job for the next three years for a down payment on a car Goals must be specific, Measurable (amount of money), Attainable, Realistic, Time bound (date)

5. (discussion) What is missing There area parts of the goal missing, Identify what it is. Go on a whitewater rafting trip next summer Save money this summer to pay for all college fees Get a job to afford to buy a motorcycle Use money receive as birthday gifts to pay own monthly phone fees Not specific or measurable Not specific, measurable, realistic, attainable Not specific, measurable, time bound

6. (notes) More Things to Consider in Making Decisions 1. Identify your goal 2. Establish a criteria 3. Examine your options 4. Weigh your pros and cons 5. Make your decision 6. Evaluate results

7. What should Rob do Save $5 a week for the next four weeks to buy a new video game Save $10 a week for the next nine weeks to buy a new pair of shoes He only manages to save $5 a week after spending What are his OPTIONS He could save $5 a week for eighteen weeks and not get the video game He could not get the shoes

8. What do you do with your money? Survey illustrates that girls and boys spend their money on different items Guys Food Soda or Soft Drinks Candy Clothes CDs or Recorded Music Girls Clothes Candy Soda or Soft Drinks Food Salty Snacks and Lunch Ranked from highest to lowest

9. (NOTES) Individuals and Money 1. Money allows us to buy things because it has a _______________ placed on it. 2. Paper _________ is called a Federal _____________ Note Money serves as a medium of exchange; Money serves as a store of value; Money serves as a measure of value; Being SMART with money allows us to SAVE and reach financial goals

10. (notes) How to SAVE Money Create a -use the five steps in financial planning process Create a Budget -use the five steps in financial planning process Building a budget requires the following 1. Time Frame to track expenses (weekly, or monthly) 2. List of all money coming in (Income), broken down into categories 3. List Categories for expenses- Fixed (mandatory), Variable (changes), Discretionary, Emergency, Savings (PYF) 4. Subtract Expenses from Income 1. Negative….make adjustments 2. Positive…..use to P.Y.F 5. Look back and see if you need further adjustments

11. (Budget Simulation) Jackson’s monthly Income Estimated Income: Paycheck (after taxes)2,100 Interest Earned 50 Total Estimated Income:2,150 Fixed Expense: Savings (P.Y.F) $500 Car Payment 325 Rent 750 Cable TV/Internet 75 Estimated Variable Expenses: Utilities 150 Food 200 Gas 100 Periodic Expenses Car Insurance ($300/6 months) 50 Total Expenses2,150 total Income 2, 150 -total expenses 2, 150 $ 0

12. (assignment) Now create a Budget for your family Remember to be realistic and it has to be monthly Don’t forget to P.Y.F.