1. Why It’s Important Budgeting techniques help you keep track of where your money goes so that you can make it go further.

2. Lifestyle Costs Money management is the process of planning how to get the most from your money.

3. Lifestyle Costs A budget is a plan for using your money in a way that best meets your wants and needs.

4. Lifestyle Costs A budget includes a record of your expected income, your planned expenses, and your planned savings over a certain period of time.

5. Lifestyle Costs The five steps in planning a budget are: Setting your goals Estimating your income Estimating your expenses Planning for savings Balancing and adjusting your budget as needed continued

6. Set Goals A budget should help you decide which goals you can meet with the amount of money you have.

7. Estimate Income Your income is the actual amount of money you earn or receive during a given time period.

8. Gross Pay Your gross pay is the total amount of money you earned for a specific time.

9. Net Pay Your gross pay is reduced by various deductions, or amounts that are taken out of your pay before you receive your paycheck. Your net pay, or take-home pay, is your gross pay minus deductions.

10. Other Income If your net pay is the only income you have to consider, it’s easy to figure your total income. If part of your income is from tips, don’t overestimate how much you expect to receive in tips.

11. Taxes Withholding, or subtracting taxes from a paycheck to be forwarded to the government, may include federal, state, and local income taxes.

12. Taxes Employers responsibility -- forward taxes withheld to government If not all taxes withheld from checks then must budget for payment of those taxes later

13. Estimate Expenses Items you have to spend money on such as food, rent, and clothing are called expenditures.

14. Estimate Expenses The two basic types of expenses are: Fixed expenses Variable expenses

15. Fixed Expenses Fixed expenses are expenses that occur regularly and that are regularly paid. For example, rent and insurance.

16. Variable Expenses Variable expenses are expenses that fluctuate from month to month. For example, food and entertainment.

17. Plan for Savings Savings protect you against expenses that you didn’t budget, that are higher than you expected, or that are completely unexpected. PYF

18. Balance and Adjust the Budget The total estimated income for a period should equal the total estimated expenses.

19. Balance and Adjust the Budget The difference between how much you planned to spend and how much you actually spent is the budget variance.

20. Graphic Organizer Planning a Budget Graphic Organizer Set Goals Estimate Income Plan for Savings Balance and Adjust the Budget Estimate Expenses