1. Diving Into Spending Plans!
How to budget your money properly

2. Today We’ll Talk About Spending Plan/Budget - What is it? Why use it?
Income and Expense

3. Almost half of all American families spend more money than they make.
Why do you think this happens?
People do not make enough money
People spend too much money
One point to each group that answers, each group gets a chance…
Write on paper

4. Values, Needs, & Wants What is a need? What is a want?
Something that is a necessity
Food, water, shelter...
What is a want?
Something that is not a necessity but is desired
Coffee from Starbucks, skis
One point for each group

5. Why do needs and wants matter?
Trade-Offs and Opportunity Costs
Use trade-offs and opportunity costs to help you make these decisions
Opportunity cost – the value of the next best alternative that must be forgone as a result of a decision
Trade-off - giving up one thing for another
Is the trade-off to your decision a need or a want?
What is the value (opportunity cost) of that trade-off to you?

6. Spending Plan/Budget - What is it?
A spending plan/budget is
A tool to help people manage their money

7. Spending Plan/Budget - Why use it?
Why would you want to know where your money is going?
Spending plans/budgets are used to help people
Track where their money is going
Identify income and expenses
Meet financial goals

8. A Spending Plan/Budget Tracks…..
Income
Money earned
Expense
Money spent
Variable: Changes each month
Fixed: Remains the same each month

9. Spending Plan/Budget Contents
Expenses: Fixed or variable?
Housing
Utilities
Transportation
Savings
Food
Insurance
Clothing
Income

10. Lee’s Spending Plan Example
Income
Expenses
Item
Amount
Mowing a lawn
$10.00
Movie ticket and popcorn
$15.00
Birthday gift
Snack and drink
$5.00
Total
$25.00
$20.00
Does Lee have enough income to pay his expenses?
If he would like to buy a new shirt for $15, does he have enough money?

11. In Conclusion A spending plan is A spending plan is based on
A tool to help people track their money
A spending plan is based on
Values, wants, and needs
A spending plan tracks
Income and expenses

12. The End!