Slide 1 le Budget s...cts . 16 Clothing should be budgeted for also, even though you may not shop for clothing every month. Toiletries and other personal care products should be budgeted

Presentation Notes Creating My Lifestyle Budget

Presentation Notes: Creating My Lifestyle Budget Copyright © Texas Education Agency, 2014. All rights reserved.

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Creating My Lifestyle Budget

Career Portals



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Copyright

Copyright © Texas Education Agency, 2014. These Materials are copyrighted © and trademarked ™ as the property of the

Texas Education Agency (TEA) and may not be reproduced without the express written permission of TEA, except under the

following conditions:

1) Texas public school districts, charter schools, and Education Service Centers may reproduce and use copies of the

Materials and Related Materials for the districts’ and schools’ educational use without obtaining permission from TEA.

2) Residents of the state of Texas may reproduce and use copies of the Materials and Related Materials for individual

personal use only, without obtaining written permission of TEA.

3) Any portion reproduced must be reproduced in its entirety and remain unedited, unaltered and unchanged in any way.

4) No monetary charge can be made for the reproduced materials or any document containing them; however, a reasonable

charge to cover only the cost of reproduction and distribution may be charged.

Private entities or persons located in Texas that are not Texas public school districts, Texas Education Service Centers, or Texas

charter schools or any entity, whether public or private, educational or non-educational, located outside the state of Texas

MUST obtain written approval from TEA and will be required to enter into a license agreement that may involve the payment of

a licensing fee or a royalty.

For information contact: Office of Copyrights, Trademarks, License Agreements, and Royalties, Texas Education Agency, 1701 N.

Congress Ave., Austin, TX 78701-1494; phone 512-463-7004; email: [email protected].

Copyright © Texas Education Agency, 2014. All rights reserved. 2



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Budget

A plan for spending money


Why is it necessary to have a plan for spending money? Have students brainstorm the need for a plan to spend money.



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Create a Personal Budget Based on Your Selected Lifestyle


In this lesson you will:

Today we will create a budget based upon the lifestyle you have chosen.



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Components of a Budget


There are several components of a budget that are important to know. Some of the components of a budget are the rent/mortgage payment, utilities, savings, transportation and groceries.



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Here is an example of a budget that you may want to plan out.



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Copyright © Texas Education Agency, 2014. All rights reserved.7

There are numerous ways to spend your money. Here are a few examples of categories you may need to include in your budget planning.



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Savings

Why save?


Money put away into savings are important because it gives you a security blanket to fall onto when the unexpected happens. The general rule of thumb is to save about 3-6 months salary in case you lose your job, or you are unable to work.



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Why Save?

Emergencies

Specific goals (vacation, tuition)

Retirement

????


Other than for emergencies, savings can also be used for specific goals, such as vacations, tuitions, birthdays, celebrations and retirement. Can you think of any other reasons to save money?



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Mortgage/rent

What is the difference between a mortgage payment and a rent payment?

What is a down payment?


What is the difference between a mortgage payment and a rent payment? Ask for volunteers to look up the differences. The major difference between a mortgage and a rent payment is money that is spent on rent is not applied to investment into a property like a mortgage payment. Eventually, one can own a home that mortgage is being paid toward. However, individuals who pay a rent payment will never own the property. What are the pros and cons of each? Have students brainstorm the answers in groups or pairs. What is a down payment? A down payment is an initial payment made toward a large purchase.



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Utilities:

• Electricity

• Water

• Cable

• Phone Service

• Internet Service

• Can you think of others?


Utilities are extra expenses associated with owning or renting a home that are separate from the mortgage or rent payment. Sometimes apartment complexes include some utilities, such as water, in the rent payment. What are some other utilities that are not listed?



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Transportation:

• Bus pass

• Car payment

• Car insurance

• Gasoline

• Car maintenance

• Yearly registration

• Inspection Sticker


Whether you use public transportation, or a personal vehicle, you will incur transportation costs. While a personal vehicle may seem like the cheaper option over the long term, it has many costs some people may be unaware of, such as car insurance, gasoline, car maintenance, registration and inspections.



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Child Care Expenses

• Formula

• Diapers and Clothing

• Medical expenses

• Day Care fees

• Private vs. Public education


Children demand or need a large part of a person’s household budget because as they grow, they have many expenses. Some of the expenses include new clothes, food, regular doctor’s visits, day care and more. What other expenses do children have?



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Medical/Insurance Expenses

• Prescriptions

• Medical/Dental Expenses

• Medical/Dental Insurance (often provided by employers)


The rising costs of medical care is becoming a burden to some Americans. This means that Americans have more reasons to budget expenses to accommodate the costs of medications, doctor office co-pays, insurance premiums and more.



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Groceries/Household Needs


In addition to the many expenses a person must allocate funds for, groceries and household items need to be accounted for as well. Everyone will need to do household cleaning, although it may not be a desired chore. And, of course, we all eat food; therefore groceries need to be figured into the budget. What could result if a family did not budget for meals?



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Clothing/Personal Products


Clothing should be budgeted for also, even though you may not shop for clothing every month. Toiletries and other personal care products should be budgeted for each month too.



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Entertainment

• Movies

• Concert tickets

• Dining Out


Be sure to allow for an entertainment budget also. This would include items such as going to concerts, athletic events, movies or dining out. Why might it be hard to stick to an entertainment budget? What are the benefits of creating an entertainment budget?



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Other Categories

• Child support

• Student Loans

• Pets

• Gym membership

• Charity/Donations

• Can you think of others?


All budgets should be unique to the individual’s household. What might you include that we have not discussed today?



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YOUR TURN


Now it is your turn to complete a personal budget.



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Complete the budget based upon the amount of money you plan to spend in each category.



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Complete the budget based upon the amount of money you plan to spend in each category.



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Resource and References

Images:Microsoft Office Clip Art: Used with permission from Microsoft.


Documents

Slide 1 le Budget s...cts . 16 Clothing should be budgeted for also, even though you may not shop for clothing every month. Toiletries and other personal care products should be budgeted