1. Chapter 8 Budgets and Financial Records
MYPF Chapter 08
11-Sept-2001
Chapter 8 Budgets and Financial Records
Budgeting and Record Keeping
Legal Documents and Filing Systems
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2. Lesson 8.1 Budgeting and Record Keeping
Describe and prepare personal budgets.
Explain the purpose of record keeping.
Prepare a personal net worth statement and a personal property inventory.
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3. Importance of Financial Planning
Disposable income
Money left after taxes
Financial plan
Set of goals for spending, saving, and investing
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4. Preparing a Budget Estimate your income. Decide how much to save.
Estimate your expenses.
Balance your budget
Income = Saving + Spending
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5. Simple Budget Income Work $320 Allowance 20 Lunch money 40 Expenses
Lunches $ 80
Supplies 20
Snacks 40
Entertainment 120
Total income $380
Total expenses $280
Savings
To credit union $100
Total expenses plus savings $380
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6. Monthly Budget Fixed expenses Variable expenses Period expenses
Costs you must pay on a regular basis
Rent, mortgage, car loan
Not easy to change
Variable expenses
Costs that vary in amount depending on your choices
Cable, groceries, clothing, gas
Period expenses
Amounts that occur periodically
Insurance, magazines
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7. Personal Records Records of income and expenses Net worth statement
Income taxes
Net worth statement
Solvent/insolvent
Getting a loan
Personal property inventory
Insurance
Tax records
Keep for 3 years
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8. Net Worth Statement Assets – Liabilities Net worth
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9. Personal Property Inventory
Year Purchase Approximate
Item Purchased Price Current Value
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10. Lesson 8.2 Legal Documents and Filing Systems
Discuss the elements of legal contracts and your responsibilities regarding contracts.
Describe negotiable instruments and warranties.
Discuss ways to set up a filing system for personal records.
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11. Types of Contracts Contract Express contracts Implied contracts
Legally enforceable agreement between two or more parties
Express contracts
Stated agreement in words
Oral
Written
Implied contracts
Part of our daily life
Alterations, riding a bike, driving a car, children
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12. Elements of an Enforceable Contract
Legality
Must be for something legal
Genuine assent
Both parties agree
Legal form
Must be in writing
More than a year
Property
Over a certain amount
Agreement
Offer and acceptance
Consideration
Something of value
Contractual capacity
Legal ability
competent parties
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13. Consumer Responsibilities in Agreements
Understand agreement.
Keep a copy of the agreement.
Be sure the agreement is dated correctly.
Be sure all blank spaces are filled in or marked out.
Be sure all terms agreed upon are written clearly.
Be sure all dates, amounts, and other numbers are correct and clearly written.
Be sure proper disclosure is made by the seller.
Be sure all cancellations and adjustments are made in accordance with the contract.
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14. Negotiable Instruments
Must be in writing and signed by the maker
Must contain an unconditional promise to pay a definite amount of money
Must be payable on demand or on a fixed or determinable future date
Must be payable to the order of a particular person or to the holder of the note
Must be delivered to the payee
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15. Warranties Guarantee is a warranty Limited warranty
Guarantees a products performance
For all products
Tennis ball must bounce
Limited warranty
Time constraint
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16. Filing Systems for Personal Records
Paper filing system
Envelopes of folders
Electronic record keeping
Spreadsheet
Excel
Used for calulations
Database
Access
Used for data retrieval
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17. Home Filing System Medical Warranties Insurance Utilities Household
Travel
Entertainment
Taxes
Automobile
Subscriptions
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