1. Money Management

2. What is Money Management?
The daily financial activities connected to using your limited income to satisfy all your needs and wants.
Getting the most for your money through careful planning, saving, and spending.

3. Why We Buy? Income and Price Price Status
The amount of money a family earns determines their purchases
Price
The cost of an item influences whether or not we buy it.
Status
Conspicuous consumption – the desire to impress people with our purchases

4. Why We Buy cont’d Current Trends
Peer pressure and what is trendy can influence purchasing decisions

5. Why We Buy cont’d Customs and Habits Advertising/Promotions
Purchases are made repetitively and with little thought
Customs (family, religion, etc.)
Habitual
Advertising/Promotions
Advertising, contests, coupons, giveaways, etc. all encourage purchases

6. To get better value for youe money when you make a purchase
Spending Money Wisely
Smart consumers comparison shop before making a purchase
Why?
To get better value for youe money when you make a purchase

7. Spending Money Wisely Things to Compare: Prices Quality Features
Services
Warranties
Ways to Compare:
Visit store
Internet
Flyers
Newspaper ads

8. When to Buy Clearance Sales Promotional Sales
At the end of the season, stores reduce prices to make room for new merchandise
Promotional Sales
Publicize a new store or location, introduce a new product

9. When to Buy cont’d Second-hand Shopping Avoid Impulse Buying
Saves money and is environmentally friendly (ex. Garage sales, kijiji)
Avoid Impulse Buying
Buying on a whim without thought:
end up with items you don’t really need
might not have enough money left for essential items
items cost more
waste money

10. Budgeting
A budget is a plan for wise spending and saving based on income and expenses.
An example:

11. Budgeting cont’d Steps in creating a budget:
Calculate income (Gross Income)
Find Disposable Income by subtracting deductions (ex. Income tax, EI)
Find Discretionary Income by subtracting all expenses
FIXED EXPENSES: occur regularly and cannot be adjusted (ex. Car payment, rent)
VARIABLE EXPENSES: differ from month to month (ex. Food, clothing)
Find income leftover for savings by subtracting money spent on entertainment