1. WHERE DOES THE MONEY GO? A Lesson in Adulthood

2. Step 1: Let’s Take Out Federal Income Tax  If you will make $9, 075-$36,900  Subtract 9,075 from your income  Multiply remainder by.15  Add $907.50 to that number. This is total is your tax.  

3. Federal Income Tax  If you will make $39,900.01-$89,350  Subtract 36,900 from your income  Multiply remainder by.25  Add $5,081.25 to that number. This is total is your tax.  

4. Federal Income Tax  If you will make $89,350.01-$186,350  Subtract $89350 from your income  Multiply remainder by.28  Add $18,193.75 to that number. This is total is your tax.  

5. You’re not done. Go to step 2: State tax!  If you will make $25,000-$49,999.99  Multiply your original income (not after federal tax amount) by.0336  Add $691.00 to that number. This is total is your state tax.  

6. State tax!  $50,000-$149,999.99  Multiply your original income (not after federal tax amount) by.0424  Add $1,531 to that number. This is total is your state tax.  

7. Still not done! Have to pay for the old people! Go to Step 3: Social Security  Multiply your original income by 0.062%. This is your total social security contribution  

8. Now, Lets See What You Make Per Month  Add federal taxes, state taxes, and social security. These are your total required deductions.  Subtract that number from your income  The result is you NET yearly pay

9. Now, Lets See What You Make Per Month  Divide your NET yearly pay by 12  This is what you have to live on each month assuming your employer covers your health insurance and retirement. (If they don’t, your check will be smaller).

10. Sounds pretty good, huh? Now let’s look at expenses.  Though the total check amount MAY look good compared to what you are currently used to, let’s spend some time on what you HAVE to spend to live and see what’s left.

11. Place to Live:  Subtract the monthly rental amount from your monthly income  Subtract about $100 for cable and internet  Subtract about $110 for electricity and water  Subtract you cell phone bill (figure about $50 if you aren’t sure)  What do you have left?  

12. What about student loans?  For every $10,000 in student loans, expect to pay about $110 per month FOR TEN YEARS  Example: $40,000 in student loans = $440 per month FOR TEN YEARS That $40,000 dollar loan will cost you about 53,000  Using the chart on your worksheet, figure out your monthly payment and subtract it from your remaining monthly income

13. What now?  Go up front and get the amount of “money” you had left after all of those deductions.

14.  Car maintenance  Car payment  Car insurance  Gas  Renter’s insurance  Health insurance  Cell phone  Groceries (Food, toiletries, and household products  Pet related costs Time to pay the bills! How’s it looking so far? As we go through each of these, pay the envelopes on your desk the amounts we decide are appropriate.

15. More bills…  Gym membership?  Haircuts?  Clothing?  Netflix?  Other subscriptions?  Eating out?  Movies/entertainment?  Starbucks?  Anything else?

16. Any left to put in savings?????  Welcome to adulthood. Yes, it kinda sucks. 