Budgeting by suchenfz

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									Budgeting
Money Management
THE BASIC ECONOMIC
     PROBLEM:


Limited Resources

And

Unlimited Wants And Needs
   FINANCIAL
PLANNING STEPS:
       Set Goals
  Analyze Information
     Create A Plan
  Implement The Plan
  Monitor and Modify
        The Plan
       (Evaluate)
    Set New Goals
  (Continue Process)
FINANCIAL
PLANNING
 PROCESS                     DECISION-MAKING
                                 PROCESS


 Set Goals                      Identify the Goal




   Analyze
  Informatio                         Gather
       n                          Information


  Create A
    Plan           Analyze                     Examine
                  Outcomes                    Alternatives


 Implement                      Alternative
  the Plan                       Choices



  Monitor
                                   Make A
 and Modify
                                  Decision
  the Plan


               Set New
                                  Evaluate
   Set New      Goals
                                  Results
    Goals
                   MY SMART GOALS Worksheet For
                   Short-Term, Medium-Term and Long-Term.

                   Complete Two Goals For Each Time Frame.
                   1.Short-Term-achievable in 0-3 months.
                   2.Intermediate or Medium-Term-achievable in 3-12 months.
                   3.Long-Term-achievable from 1 year or greater.


                                           Timeline
                                                                                Amount to
                       Achievement           (Short,        Estimated
   Specific Goal                                                                 Save Per
                          Date           Intermediate,        Cost
                                                                                  Week
                                         Or Long-Term)
Buy Christmas             12/25/05           Short             $200           $67 [200/3]
Presents
Beach Trip               07/04/06        Intermediate          $500           $18 [500/28]
Down payment on          08/05/07            Long             $1000           $12 [1000/84]
car
a
y
m
e
n
t
s
                         Balance Sheet
:

            _
  $     $   _
  1     1
  1     1
            _
            _
                 is helpful in setting goals when budgeting
  0     5
  ,     ,   _
  0     0   _
W 0     0   _
a 0     0
g .     .
            _
e 0     0   _
s 0     0   _
            _
  $
  1
        $
        1
            _
            _
                Cash Flow Statement
  5     5   _
  ,     ,   _
  8     8   _
  0     0   _
R 0
e .
        0
        .
            _   is helpful in establishing budget categories
n 0     0   _
t 0     0   _
G           _
a           _
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            _
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    $   $   _
E   3   3
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            _
e   2   3   _
c   5   8   _
Balance Sheet
Assets                           Liabilities
Checking account   500.00        Home mortgage         50,000.00

Savings account    2,000.00      Credit card balance   300.00

Home               $90,000.00    Loan                  $2,000.00

Automobile         5,000.00


Furniture          $6,000.00     Total Liabilities     $52,300.00

Computer           $1,500.00


Jewelry            $1,000.00         Owner’s Equity


                                 Total Assets minus
                                 Total Liabilities


                                                       $53,700.00




                                 Total Liabilities
Total Assets       $106,000.00   And Owner’s Equity    $106,000.00
Personal Cash Flow Statement
Monthly Cash Inflows (Income)

Net Income (take home pay)
                                $1,500.00


Other Income (interest)         $30.00




Total Income                                $1,530.00
Monthly Cash Outflows (Expenditures)
Savings                                $150.00

Rent
                                       $400.00

Food                                   $350.00

Clothing                               $50.00

Electricity/Gas                        $90.00

Telephone                              $30.00

Car                                    $250.00

Personal Expenses                      $20.00

Entertainment                          $50.00




Total Savings and Expenditures                   $1,390.00




Net Cash Flow                                    $140.00
                     Budget

•a plan for saving and spending
•helps achieve financial goals
•helps avoid credit problems
•must be evaluated from time to time
•is essential for consumers, businesses and governments
occur regularly
same amount each time



    differ each time
          Monthly Budget

 Get a NEFE High School Financial
  Planning Guide [yellow books near
  the phone].
 Turn to Unit Three
 You are to read page 27 – 32.
 Don’t complete any of these
  worksheets, we’ll do them together
  in class.

								
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