1. Spending Chapter 4

2. Consumer Spending

3. Questions: Based on the pie chart from slide 2, what percentage of consumer spending is made up of housing-related expenses?pie chart What makes up the HOUSING category of consumer expenditures? What percentage of income is spent on eating out? What percent is spent on education? How much does the average American spend on entertainment? Since this chart only includes SPENDING, what is not included in this information?

4. Savings

5. Questions Based on the pie chart on slide 4, what percentage of Americans DO have a savings account?pie chart Financial planners recommend that Americans save 10- 15% of their annual income each year, but the average American only saves about 4%, and many not even that. Why do you think that is? Based on your 10-year salary, how much should you be saving if you save 10% annually? Did you budget enough for savings? How much do you save every month right now?

6. Public Sector Spending There are two types of federal spending: 1) Mandatory- these are spending categories that are set by law, such as Social Security. 2) Discretionary- this category can, and does, change as the political winds shift. These budgetary items are negotiable.

7. Total Spending 2014

8. Questions Does this pie chart reflect actual spending? Why do you think that? According to this chart, what percentage of the federal budget was spent of social welfare programs? What percentage was spent on education? What are the other major line items in the federal budget? What percentage was spent on paying the interest on our national debt? Does this money go toward paying off the principle of the loans?

9. Proposed Total Spending 2015

10. 2015 Proposed Spending

12. Questions How is the information in the charts on slides 10 & 11 different from the chart on slide 9? What total percentage of the 2015 proposed budget is mandatory expenditures? What are the two biggest line items in the mandatory spending budget? What makes up discretionary spending? What is the biggest line item in discretionary spending? What percentage of the total budget is spent on education? What percentage of discretionary spending is spent on education? If you could, how would you change the proposed 2015 budget and why? Remember-you can only change discretionary spending, not mandatory spending.