Household Budget Project
This Budget Project has been designed to give you an idea of
what the economic realities of life are when you emerge from
“Fantasy Land” (whether it be SHS or college).
Read through the problems carefully and TAKE YOUR
Make sure you use a calendar and a calculator for all problems.
Double check your work. Errors can prove to be costly.
You may room with another person but it can only split up
rent and utilities. Food and other stuff is your responsibility.
You must keep detailed record of your expenses and income
for a three month period of time.
USE OUTSIDE RESOURCES (if you’re not talking to your
parents you’re doing yourself a disservice).
You will be graded on accuracy of math, thoroughness of
budget preparation, neatness, and your final paper.
THIS IS NOT AN EASY PROJECT. It is not meant to be. It
is realistic in terms of expenses and scope. DO NOT
Household Budget Project
You are required to complete a budget showing your gross annual
income, your take home pay, fixed costs, variable costs, and future
costs. It is very important to be realistic when figuring out your
budget. Remember this most likely will be the first time out on your
own so the costs may seem somewhat high.
Your income will be a predetermined amount that will be
assigned to you based on how much I like you. As in life your
income/career will be determined on several factors, not the least of
which is luck.
You income will be immediately affected by taxes, insurance,
and retirement savings so don’t start complaining…it gets worse.
Usually includes rent, utilities, train/bus fares, cable, internet,
phone, etc. Make sure the amounts are accurate and verified.
Includes, but not limited to, entertainment, personal products,
groceries, medication, gifts, clothing, furnishing, gas, maintenance,
etc. Life comes at you pretty fast… have a plan.
A consulting fee of $50 per question will be charged if the teacher is
used as a resource. I will allow the question to be asked, then will let the student know if the charge applies, if the agree to the terms then we will proceed.
THE JACKA** TAX WILL BE APPLIED TO ANY AND ALL
INFRINGEMENTS OF PUBLIC AND PRIVATE DECORUM THAT
THE MANAGEMENT FINDS DISDAINFUL. THE J/A TAX WILL BE
KEPT IN A LEDGER AND MUST COME INTO BALANCE ON THE
INDIVIDUALS BUDGET PROJECT OTHERWISE, SAID PROJECT,
WILL NOT BE ACCEPTED.
You are about to embark on the great unknown, life after “fantasy
land”. The following problems have been geared to help you
prepare for that unknown. Some tips before you begin:
1. Start immediately.
2. Take your time
3. Talk to your parents
4. Don’t give up (if you get frustrated, welcome to the
5. Be Creative
6. Each “Problem” should have its own page in your
7. If your budget project is not in a three ring binder (or
bound in other ways), duck, because it’s coming back
1. Determine your net paycheck (10 pts)
Gross Paycheck: _______
- 401K participation (up to 10%)_________
- Medical Insurance($50 per check) ______
= Taxable Income ________
-Federal Withholding (%13) ___________
-State Withholding (%3) ____________
-Social Security Tax (%6.2) ____________
-Medicare (%1.45) ____________
=Net Paycheck ___________
****Note: Your Gross check amount is the amount you earn before taxes or any
deductions are made. Your taxable income is identified as the amount of money you have
left after medical and retirement expenses are taken out. And your net income is your take
home pay, after taxes.
2. Breakdown income to an hourly wage (2 pts) (assume a 5 day, forty hour work week)
3. List your fixed expenses and their projected costs (minimum 6) (10 pts)
4. List your variable (flexible expenses) and their projected dollar
amounts. How did you determine the amount of these expenses?
5. Rent, an apartment. Consider where you will be working (see
problem 15). If you need to take a train/bus to work, you must
provide for that. You are required to pay a 1 month security deposit
equal to 1 month’s rent. If utilities are not included allow for %20 of
rent to cover these expenses. (10 points)
6. Asset Inventory Take and inventory of your current assets.
Negotiate with your parents on what they will allow you to take to
your new place (must have signed document of agreeance). Estimate
the cost of buying new stuff you will need/want for your new place
(Bed, Xbox, towels, TV, etc) (see problem 12) (10 points)
7. Checkbook Registrar- write at least five checks in payment of rent,
car, etc (5 point)
8. Buy a car. I don’t care if you live in the city, you will do this exercise.
You must buy a new or used car and it must be reliable. I know crap
when I see it. (15 points)
i. Price of car ____________-
ii. +125 for Docs and fees_____________
iii. +%8 sales tax _______________________
iv. =Total price of car _________________
To figure the monthly payment use the following formula:
Principle x Loan Rate (X%) x Time (in years)= Interest on life of loan
Interest + Principle/total months of loan= Monthly payment
9. Car Insurance(proof) Allow for monthly payments in budget. (5
10. Complete a credit card application. What’s the method of pay?
What’s the APR? Is this a good card for you? (5 points)
11. Complete an employment application (5 points)
12. Complete a loan application- use your inventory needs for the loan
amount (ex. If you need a bed and a couch and table, and the total
is 3500, then that’s the amount you use.) (5 points)
13. Make a Holiday Season Gift list. Allow for this in your budget. (5
14. Plan for a future vacation. You can go anywhere you want, for as
long as you like . Research the actual costs (airfare, lodging, meals,
etc) and document them. How much would you have to save each
month to afford this trip in two years? Allow for this in your budget.
15. Find a job you will looking for upon your graduation, note what type
of money offered and where the job may be. Remember, you will be
a college grad, but you will have no experience, entry level positions
will only apply to you. (5 points)
16. Complete a 1040EX based on the amount of money I have assigned
to you. (10 points)
17. Complete a pie graph of your expenses (5 points)
18. Complete a student loan repayment schedule. Even if your parents
are paying for the whole ride, you must do this portion (base it on
full tuition and room/board if applicable) Example provided (20
19. Complete a daily meal planner and food expenses matrix. Example
provided (25 points)
20. Price compare shop for an item costing over $250 that you are
actually considering purchase of in the next year.(20points)
a. Show proof of reseach of products and their kin along with
different websites/stores from which to purchase
b. Write a paragraph explaining your rationale for choosing the
product as well as the store over all others.
21. Separate from all will be your actual BUDGET LAYOUT FOR
THREE MONTHS. This is the record of all monies coming in
balanced against all monies going out. Example provided (25 points)
22. In a two paged, typed summary, evaluate your experience on this
project. Was it realistic? Discuss the difficulty in planning your
budget. Did you have money left at the end of the project? If you
were short money, what might be some explanations and options
that are available to you to remedy the situation? What did you
like/dislike about the project? How would you improve this for the
next class? Did your parents have any comments? (25 points)
THERE WILL BE NO EXCEPTIONS FOR LATE WORK.
IF YOU KNOW YOU ARE GOING TO BE GONE
EARLIER THAN THE DUE DATE, TURN IT IN
GOOD DAY AND GOOD LUCK