Family Economics & Financial Education G 1 Get ready to Take Charge of Your Finances Life Of….. Carlos Chavez “A Teenager’s Spending Plan”

G 1 © Family Economics & Financial Education –Updated April 2010 – Get Ready to Take Charge of Your Finances – Life Of...Carlos – Slide 2 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at The University of Arizona Snapshot – Carlos Chavez Sneak peak into the life of Carlos and his family –Carlos –Nana (Martha) –Jorge –María –Adriana –Marco

G 1 © Family Economics & Financial Education –Updated April 2010 – Get Ready to Take Charge of Your Finances – Life Of...Carlos – Slide 3 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at The University of Arizona Snapshot Carlos' Income and Expenses Carlos' Income –Sunshine Inn $8.50/hour 10 hours a week

G 1 © Family Economics & Financial Education –Updated April 2010 – Get Ready to Take Charge of Your Finances – Life Of...Carlos – Slide 4 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at The University of Arizona Snapshot Carlos' Income and Expenses Carlos' Expenses –Extracurricular Activities Youth group ski trip –$5.00 per month Track expenses –$2.50 per month –Transportation $ –Saving Family Support –$40.00 per month College expenses –$50.00 per month –Lunch $24.00per month –Others

G 1 © Family Economics & Financial Education –Updated April 2010 – Get Ready to Take Charge of Your Finances – Life Of...Carlos – Slide 5 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at The University of Arizona Spending Plan The goal is to create a spending plan that balances Carlos' expenses with his income. He cannot have more expenses than income. Spending Plan –Financial statement –Tracks income and expenses –Used to assist with money management and help the family reach financial goals –An family’s perception of needs, wants and values will affect decisions made when creating a spending plan

G 1 © Family Economics & Financial Education –Updated April 2010 – Get Ready to Take Charge of Your Finances – Life Of...Carlos – Slide 6 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at The University of Arizona Snapshot Chavez Family Expenses Carlos' Expenses Housing –Monthly Payment –Utilities –Others – television, internet and telephone Transportation –Vehicle for María –Monthly payment and fuel –Bus pass for Jorge Insurance –Homeowners, disability, life, auto, and health Food –Groceries –School lunches Savings and Debt –Savings of $125 per month for retirement and future college expenses –Monthly medical payments of $155.00

G 1 © Family Economics & Financial Education –Updated April 2010 – Get Ready to Take Charge of Your Finances – Life Of...Carlos – Slide 7 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at The University of Arizona Housing Monthly Payment –Housing payment –Insurance –Property taxes –Repairs –Maintenance Utilities –Heat –Electricity –Water –Sewer –Garbage

G 1 © Family Economics & Financial Education –Updated April 2010 – Get Ready to Take Charge of Your Finances – Life Of...Carlos – Slide 8 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at The University of Arizona Digital Cable Add Ons Telephone Cellular Phone Internet Housing Others

G 1 © Family Economics & Financial Education –Updated April 2010 – Get Ready to Take Charge of Your Finances – Life Of...Carlos – Slide 9 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at The University of Arizona Transportation Monthly Payment –Car payment –Maintenance Fuel –An average is listed –This cost may increase/decrease depending on the cost of fuel Chavez Family –Pay for María's monthly payment and fuel costs Bus Pass

G 1 © Family Economics & Financial Education –Updated April 2010 – Get Ready to Take Charge of Your Finances – Life Of...Carlos – Slide 10 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at The University of Arizona Others Running Supplies Downhill Ski Supplies Electronics Video Games Entertainment Cellular Phone Create Your Own

G 1 © Family Economics & Financial Education –Updated April 2010 – Get Ready to Take Charge of Your Finances – Life Of...Carlos – Slide 11 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at The University of Arizona Goal: To Create A Balance Spending Plan Make all choices for the Chavez family and Carlos Complete a Major Expenditures Summary for the Chavez family Complete a Spending Plan for Carlos Answer reflection questions Write a summary essay

G 1 © Family Economics & Financial Education –Updated April 2010 – Get Ready to Take Charge of Your Finances – Life Of...Carlos – Slide 12 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at The University of Arizona Quick Review Chavez Family –Carlos, Nana (Martha), Jorge, María, Adriana, Marco Create a Major Expenditures Summary for the Chavez Family –Housing –Transportation Create a Spending Plan for Carlos –Extracurricular Activities –School Lunches –Savings –Others

G 1 © Family Economics & Financial Education –Updated April 2010 – Get Ready to Take Charge of Your Finances – Life Of...Carlos – Slide 13 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at The University of Arizona Snapshot Reflection Review Carlos' Snapshot on pages 2-4 Answer questions 1-5 on page 10

G 1 © Family Economics & Financial Education –Updated April 2010 – Get Ready to Take Charge of Your Finances – Life Of...Carlos – Slide 14 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at The University of Arizona Carlos' Paycheck Personal Information State the employee’s name, address, and social security number.

G 1 © Family Economics & Financial Education –Updated April 2010 – Get Ready to Take Charge of Your Finances – Life Of...Carlos – Slide 15 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at The University of Arizona Carlos' Paycheck Pay Period The length of time which an employee’s wages are calculated.

G 1 © Family Economics & Financial Education –Updated April 2010 – Get Ready to Take Charge of Your Finances – Life Of...Carlos – Slide 16 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at The University of Arizona Carlos' Paycheck The total amount of money earned during the pay period before payroll withholdings. Gross Pay

G 1 © Family Economics & Financial Education –Updated April 2010 – Get Ready to Take Charge of Your Finances – Life Of...Carlos – Slide 17 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at The University of Arizona Carlos' Paycheck The amount of money subtracted from the gross pay for taxes. Payroll Withholdings

G 1 © Family Economics & Financial Education –Updated April 2010 – Get Ready to Take Charge of Your Finances – Life Of...Carlos – Slide 18 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at The University of Arizona Carlos' Paycheck The amount required by law for employer to withhold from earned wages to pay taxes. Withholding Tax

G 1 © Family Economics & Financial Education –Updated April 2010 – Get Ready to Take Charge of Your Finances – Life Of...Carlos – Slide 19 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at The University of Arizona Carlos' Paycheck Federal Insurance Contribution Act – includes Social Security and Medicare FICA

G 1 © Family Economics & Financial Education –Updated April 2010 – Get Ready to Take Charge of Your Finances – Life Of...Carlos – Slide 20 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at The University of Arizona Carlos' Paycheck Net Pay The amount of money remaining after all payroll withholdings have been removed from gross pay.

G 1 © Family Economics & Financial Education –Updated April 2010 – Get Ready to Take Charge of Your Finances – Life Of...Carlos – Slide 21 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at The University of Arizona Carlos' Paycheck Totals of the deductions which have been withheld from an individual’s paycheck from January 1 to the last day of the pay period indicated on the paycheck stub. Year-to-Date

G 1 © Family Economics & Financial Education –Updated April 2010 – Get Ready to Take Charge of Your Finances – Life Of...Carlos – Slide 22 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at The University of Arizona Setting Education and Financial Goals Short Term – less than one year Long Term – more than one year SMART Goal S pecific State exactly what is to be done. M easurable Include how the goal can be measured. A ttainable Determine steps to reach the goal. R ealistic Do not set the goal for something unrealistic. T ime B ound State when the goal will be met.

G 1 © Family Economics & Financial Education –Updated April 2010 – Get Ready to Take Charge of Your Finances – Life Of...Carlos – Slide 23 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at The University of Arizona Chavez’s Major Expenditures Housing Choose a house and housing others for the Chavez family Refer to the Snapshot on pages 2-4 Remember –Family size –Lifestyle –Other family dynamics

G 1 © Family Economics & Financial Education –Updated April 2010 – Get Ready to Take Charge of Your Finances – Life Of...Carlos – Slide 24 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at The University of Arizona Chavez’s Major Expenditures Transportation Choose a vehicle for María Refer to the Snapshot on pages 2-4 Remember –They need enough room in the vehicle for the family and supplies when they take trips together

G 1 © Family Economics & Financial Education –Updated April 2010 – Get Ready to Take Charge of Your Finances – Life Of...Carlos – Slide 25 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at The University of Arizona Chavez’s Major Expenditures Major Expenditures Summary Transfer numbers to complete the summary –Total housing cost –Total transportation cost –Insurance –Food –Savings and Debit Each month $ is saved for retirement and future college expenses Each month $ is paid to help a medical debt of $11,000

G 1 © Family Economics & Financial Education –Updated April 2010 – Get Ready to Take Charge of Your Finances – Life Of...Carlos – Slide 26 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at The University of Arizona Carlos' Spending Plan Payroll Withholdings Review Carlos' paycheck on page 11 –State Withholding Tax –Federal Withholding Tax –FICA

G 1 © Family Economics & Financial Education –Updated April 2010 – Get Ready to Take Charge of Your Finances – Life Of...Carlos – Slide 27 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at The University of Arizona Carlos' Spending Plan Savings Review Carlos' Snapshot on pages 2-4 –Identify his needs, wants, values Review the short term and long term goals set for Carlos on page 12

G 1 © Family Economics & Financial Education –Updated April 2010 – Get Ready to Take Charge of Your Finances – Life Of...Carlos – Slide 28 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at The University of Arizona Carlos' Spending Plan Others Extracurricular Activities School Lunches Choose which “others” items Carlos would like –Running Supplies –Downhill Ski Supplies –Electronics –Video Games –Entertainment –Create Your Own Draw an item and identify the cost in the space provided

G 1 © Family Economics & Financial Education –Updated April 2010 – Get Ready to Take Charge of Your Finances – Life Of...Carlos – Slide 29 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at The University of Arizona Carlos' Spending Plan Summary Gross Income Expenses Calculate the Difference If the difference is a negative number, go back and adjust some of Carlos' expenses.

G 1 © Family Economics & Financial Education –Updated April 2010 – Get Ready to Take Charge of Your Finances – Life Of...Carlos – Slide 30 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at The University of Arizona Negative or Positive Difference? If the number on XX is positive, adjust Carlos' expenses. –Saving additional money for unexpected emergencies or expenses may be a good idea. If the number on XX is negative, go back and make adjustments to Carlos' expenses. –Changes need to be made consistently throughout the simulation. –Keep in mind Carlos' needs, wants, values and goals when making changes. If the number on XX is zero, congratulations! You have balanced Carlos' Spending Plan!

G 1 © Family Economics & Financial Education –Updated April 2010 – Get Ready to Take Charge of Your Finances – Life Of...Carlos – Slide 31 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at The University of Arizona Reflection Questions Once the difference equals zero…. –Answer questions on pages 15 and 16 –Answer questions on page 18