1. Creating a budget

2. Note for teacher: Use “Pick a Student” button in CPS
Warm-Up Questions
CPS Questions 1 – 2
Note for teacher: Use “Pick a Student” button in CPS
Chapter 1, Lesson 1

3. Chapter Overview
Lesson 1: Creating a Budget Lesson 2: Savings and Bank Accounts Lesson 3: Real-Life Issues in Buying and Selling
Chapter 1, Lesson 1

4. Lesson Overview The Components of a Personal Financial Plan
The Steps to Creating and Developing a Personal Financial Plan
The Elements of a Budget
Chapter 1, Lesson 1

5. Note for teacher: Use “Pick a Student” button in CPS
Quick Write
Why do you think it is important for you to have a financial plan? Do you think a plan is just as important for someone who is wealthy as it is for someone who’s just getting by? Why or why not?
Note for teacher: Use “Pick a Student” button in CPS
Chapter 1, Lesson 1
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6. Components of a Financial Plan
Finance - the management of money
Personal Finance - how you manage your money
Chapter 1, Lesson 1
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7. Advantages of a Personal Financial Plan
Make good financial decisions
Evaluate the opinions of financial advisers
Chapter 1, Lesson 1
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8. Creating a Personal Financial Plan
Managing your budget
Managing your liquidity
Financing Large Purchases
Protecting Your Assets
Investing for the Future
Investing in Your Retirement
Chapter 1, Lesson 1
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9. GOAL: Income > Expenses
Managing Your Budget
Budget
Detailed summary of expected expenses and income
Income
Money coming in on a regular basis
Expenses
Money going out for needs and wants
GOAL: Income > Expenses
Chapter 1, Lesson 1
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10. Managing Your Liquidity
Access to funds to cover a short-term cash need
Money needed to cover unexpected expenses
Chapter 1, Lesson 1
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11. Financing Your Large Purchases
Obtaining or providing money for a specific purpose
Generally comes in the form of loans
Interest
Charge on borrowed money
Compound Interest
Interest on accumulated unpaid interest
Chapter 1, Lesson 1

12. Protecting Your Assets
Something of value that you own
Tangible assets are physical items
Assets may be protected with insurance
Insurance
An agreement between two parties
Premium or monthly fee
Chapter 1, Lesson 1

13. Investing for the Future
Investment
Something you own that you expect to increase in value over time
Examples of investments:
Stocks
Bonds
Mutual Funds
Chapter 1, Lesson 1
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14. Investing in Your Retirement
Period of life during which you no longer work full time
People typically retire once they qualify for Social Security
Military members may retire after 20 years of service
Start planning for retirement now
Chapter 1, Lesson 1
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15. Learning Check Questions
CPS Questions 3 – 4
Note for teacher: Use “Pick a Student” button in CPS
Chapter 1, Lesson 1

16. Activity 1: Financial Planning Process
On the worksheet provided, list the six steps in the financial planning process.
For each step, list an activity/task that you should accomplish.
Be prepared to share your answers with the class.
Chapter 1, Lesson 1

17. Steps for Developing a Personal Financial Plan
Establish your financial goals:
How important is money to you?
What do you need money for?
Be realistic
Timing is important:
Short-term
Intermediate-term
Long-term
Chapter 1, Lesson 1
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18. Learning Check Questions
CPS Questions 5 – 6
Note for teacher: Use “Pick a Student” button in CPS
Chapter 1, Lesson 1

19. Activity 2: Financial Goals
On the worksheet provided, identify 3-5 financial goals for each timeframe:
Short-term goals
Intermediate goals
Long-term goals
Be prepared to share your answers with the class.
Chapter 1, Lesson 1

20. Steps for Developing a Personal Financial Plan (cont)
Your Current Financial Position
Present financial position impacts future decisions
Identify and Evaluate Alternative ways to Achieve Goals
Savings Account
Investments/Stocks
Chapter 1, Lesson 1
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21. Steps to Creating a Personal Financial Plan (cont)
Select the best plan
Should be a plan you can stick with
Evaluate your plan
Review it regularly to see how you’re doing
Revise your plan
Note where it’s worked and not worked
Chapter 1, Lesson 1
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22. Learning Check Questions
CPS Questions 7 – 8
Note for teacher: Use “Pick a Student” button in CPS
Chapter 1, Lesson 1

23. Activity 3: Smart Money Research
Use the internet to research smart money management techniques.
Focus on tips that help meet your financial goals.
Identify your top 5 tips for smart money management.
Be prepared to share your tips with the class.
Chapter 1, Lesson 1

24. The Elements of a Budget
Income – money you receive regularly
Salary / Wages
Savings
Investments
Expense – money you spend
Clothing
Entertainment
Food
Car
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Chapter 1, Lesson 1

25. Learning Check Questions
CPS Questions 9 – 10
Note for teacher: Use “Pick a Student” button in CPS
Chapter 1, Lesson 1

26. Activity 4: Personal Budget Planning
Using the worksheet provided, create a three-month budget listing your expenses and income.
Is your budget balanced? Is your budget realistic? If not, revise it.
Be prepared to share your tips with the class.
Chapter 1, Lesson 1

27. Summary The Components of a Personal Financial Plan
The Steps to Creating and Developing a Personal Financial Plan
The Elements of a Budget
Chapter 1, Lesson 1

28. Note for teacher: Use “Pick a Student” button in CPS
Review Questions
CPS Questions 11 – 12
Note for teacher: Use “Pick a Student” button in CPS
Chapter 1, Lesson 1

29. Next… Savings and banking accounts Chapter 1, Lesson 1
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Chapter 1, Lesson 1