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Test Prep.

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Presentation on theme: "Test Prep."— Presentation transcript:

1 Test Prep

2 Budget

3 Building a Budget

4 Vocabulary BUDGET: A record of income and spending; a plan for managing (making, saving and spending) money. DISCRETIONARY SPENDING: Money available to spend on goods and services that are not essential; spending on your wants, as opposed to needs. EXPENDITURES: Money that is spent on goods, services, and bills. SURPLUS: Money leftover after you’ve paid all of your expenses.

5 Vocabulary DEFICIT: a shortage of money because you’ve spent more than you earned. IMPULSE BUYING: Making a purchase based on an immediate want or due to the pressure of advertising. LONG-TERM GOALS: Plans that take a year or more to accomplish. SHORT-TERM GOALS: Plans that can be accomplished within three months to a year.

6 Needs Survival essentials, such as food, water, clothing, and shelter
JA Finance Park Module Four

7 Wants Goods or services that make people more comfortable or content but which are not essential for survival. JA Finance Park Module Four

8 Assess your Values Around Purchases
Take a few minutes and rate the priority level of the items listed. 1 = need 2 = high priority want 3 = low priority want

9 To reach your goals, sometimes you have to make hard choices.
No one can have all the things they want. Choosing how you spend your money now can help you save to meet your future goals. JA Finance Park Module Four

10 Personal insurance & pensions 11% 10% Other 10%
0.5% 5% 3% Housing 33% 7% Transportation 17.5% Food 13% 33% Personal insurance & pensions 11% 10% Other 10% Health care 7% 11% Entertainment 5% Clothing 3% 17.5% Cash 0.5% JA Finance Park Module Four 13% Source: Bureau of Labor Statistics 2012

11 Where Does the Money Go? Infographic

12 Determine your Net Monthly Income. Categorize your expenditures.
Distribute funds to meet needs and obligations. Determine your discretionary income. JA Finance Park Module Four

13 Tricks to Build a Budget
Start from scratch Account for every dollar Focus on what really matters Prioritize your debt Track your budget using a strategy that works for you! Article

14 Tricks to Build a Budget
6. Use separate accounts 7. Give yourself some wiggle room 8. Know your weaknesses 9. Adjust your budget as time goes on 10. Stick to it!!!

15 50/20/30 Plan Approach to budgeting benefits from simplicity.
50% of income goes to necessities, 20% to long term savings, and 30% to lifestyle choices. This plan can be a good starting point for those struggling to decide just how much they should spend on individual budget categories.

16 Actual Numbers Household of 3 (2 adults, 1 child); 2 dogs and a cat
Average Monthly Amounts for Categories Automobile Gas $232 Service and Parts $500 Kids $217 (supplies- like diapers and wipes, clothing, activities, toys) Pets $276 (food, vet., grooming, medicine) Food Groceries $783 Eating Out $371 (fast food and restaurants)


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