More Budget Practice Financial Literacy

What do you spend money on? What are your sources of income (if any)? About how much income do you receive monthly? If you have a mobile banking app, log on and record your spending habits over the last two weeks If you don’t, try to think of everything you’ve spent money on in the last two weeks. Classify each purchase as a need or a want.

Budget Classwork Assignment On a separate sheet of paper, calculate the net income using the info on the next slide Then, you will complete the budget by determining estimated expenses. List all expenses, being as specific as possible. Choose a city to live in and research the cost of living You should be left with a balance of zero – spending or saving all money without going over!

Taxes Your federal income tax rate depends on your tax bracket You will pay a higher rate the more money you make Social Security (or FICA) tax – 6.2% Medicare – 1.45%

Income Calculate the following: After college or trade school, you accept a job offer with an annual salary of $40,000. Gross monthly income: $_________ Monthly deductions: Monthly federal income tax (16.7%): $__________ Monthly social security tax (6.2%): $_________ Monthly Medicare tax (1.45%): $__________ Contribution to employer health & dental insurance: $30 Net monthly income: $________

Expenses: Classify as variable or fixed AND as mandatory (needs) or discretionary (wants) Rent or mortgage payment Renter’s or homeowner’s insurance Transportation Car payment Car insurance Gas Maintenance Utilities Cell phone bill Internet bill Student loan payment Food Groceries Eating out Entertainment Miscellaneous expenses Clothing Household products Donations/giving Savings Set amount each month Retirement Additional amount for specific item/goal