Money 101
Barb Wollan
Family Finance Program Specialist
515-832-9597; bwollan@iastate.edu
ISU Extension builds
partnerships and provides
research-based learning
opportunities to improve quality
of life in Iowa
Iowa State University
Extension
• Information
– Research-based
– Non-commercial
– Practical
– Five primary topic areas
• An office in every county
• Multiple ways of accessing information
So What’s 65 Cents?
“Beware of little expenses:
a small leak
will sink a great ship”
Benjamin Franklin
“Can’t Afford It”
Money Management
Using What You Have
to
Get What You Want
What You Have
• Many types of resources:
– Economic Resources
(income, bank accounts, credit,
unemployment benefits, etc)
– Community Resources
(parks, libraries, agencies, …)
– Human Resources
(skills, information, health/energy, attitudes)
What You Want
Needs, Wants, Goals…
When finances are tight, you need to
select your highest priorities.
What’s most important to you?
You want to be able to look back and be
happy with where your money went.
Money Management Steps
1. Know What You Have
2. Know What You Want
3. Make a Plan
Spending Plan
(aka Budget)
• Income
• Expenses – how much have you been
spending?
– Fixed Expenses
– Flexible Expenses
– Periodic Expenses
Periodic Expense
• Less frequent than monthly
(quarterly, annually, …)
• Predictable
• Examples?
Periodic (Occasional) Expenses
Periodic Expenses
Example:
Suppose Total Expenses: $2,280
Monthly amount to set aside in savings
$2,280 /12 = $190
Savings
Essential component of a
spending plan
• Periodic Expenses
• Planned Future Expenses
• Emergency Fund
Spending Plan
• Income
• Expenses – info about past spending
– Fixed Expenses
– Flexible Expenses
– Periodic Expenses
– Unanticipated Expenses
• Make Your Plan Going Forward
Spending Plan Tips
• Use a time period that works for you
• Be realistic
• Build in flexibility
Money Management
Steps
1. Know What You Have
2. Know What You Want
3. Make a Plan
4. Follow the Plan
Following Your Plan
• Tracking Methods
– Ledgers
– Computers
– Envelopes
• Choose/Create/Adapt
• Make it Fit for You
Money Management
Steps
1. Know What You Have
2. Know What You Want
3. Make a Plan
4. Follow the Plan
5. Think it Over for Next Time
Benefits of Managing
your $
• Stretch dollars
• Work toward goals
• Be prepared for emergencies
• Spend wisely
In a difficult
situation…
Using What You Have to
Get What You Want
Expand your resources
Re-think and prioritize
your goals
Are you satisfied
with where
Your Money is Going?
Money Management
Using What You Have
to
Get What You Want
Smart Money Managers
Make Smart Choices
Trade-offs
• Give up the less important options
• Use money for the more important
options