2 Organizing Financial Records CHAPTER 5 SECTION 1
3 What kinds of financial records do you keep? Brainstorm in your notes
4 Money ManagementDay-to-day financial activities necessary to get the most from your money.Money trade-offs
5 Financial DocumentsFirst step in effective money management is to organize your financial documents.Benefits:Financial statusPay your bills on timeTax reportsFuture planningInvesting decisions
6 Storing Financial Documents Locate your documents and sort them into categories such as payroll stubs, savings account, checking account, bills, etc.Label and file each documentMaintain filing discipline
7 Safe-Deposit BoxA small, secure storage compartment that you can rent at a bank.
8 Chapter 5.1 Review Questions Textbook Page 125#1-6Due at the end of classWhen finished – write down the key words and definitions from Ch. 5.2
9 Personal Financial Statements CHAPTER 5 SECTION 2
10 Personal Balance Sheet Allows you to have a complete look at your financial situation.Step 1: Determine AssetsStep 2: Determine LiabilitiesStep 3: Calculate Net WorthStep 4: Evaluate Financial Situation
11 Net Worth ExampleWhat is your net worth is you have $4,000 in assets and $1,250 in liabilities?$4,000 - $1,250 = $2,750
13 Cash Flow StatementMovement of cash in and out of your wallet and/or bank account.Step 1: Record your incomeStep 2: Record your expensesStep 3: Calculate your net cash flow
14 Chapter 5.2 Review Questions Textbook Page 134#1-6Due at the end of class
15 Budgeting for Financial Goals CHAPTER 5 SECTION 3
16 BudgetA plan for spending and investing your money to meet your wants and needs.Step 1: Set your financial goalsStep 2: Estimate your incomeStep 3: Budget for unexpected expensesStep 4: Budget for fixed expensesStep 5: Budget for variable expensesStep 6: Record spending
17 Budget VarianceThe difference between the budget and the actual amount spent.
18 Chapter 5.3 Review Questions Textbook Page 143#1-6Due at the end of class