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Budgeting & Saving PowerPoint Budgeting & Saving PowerPoint Presentation Transcript

  • Budgeting & Saving: Don’t Go Broke!
  • Can You Believe?
    • On average, teens earn about $5.70 per hour and work about 15 hours per week, for a weekly paycheck of over $80.
    • In 1998, the average teenager earned almost $2,300 for the year.
    • The average teen receives $50 a week from parents.
  • Can You Believe?
    • Teenagers in the U.S. spent over $155 billion in 2000.
    • Teen girls spend about $91 per week on average, while teen boys spend about $87.
  • Can You Believe?
    • A little over 1/3 of teens receive a regular allowance, and about 20% of teens have a full- or part-time job.
    • 22% of teens have checking accounts.
  • Can You Believe?
    • Almost 60% of teens follow a 50/50 plan: half of any money received is spent, and the other half goes into savings.
  • What Is A Budget?
    • A budget is a plan for managing money during a given period of time.
    • Income : Any money coming in
    • >What’s the difference between gross income and net income ?
  • What Is A Budget?
    • Expenses : The money you spend on your needs and wants; Money going out
    • >What’s the difference between fixed expenses and variable expenses?
    • - Fixed expenses have set dollar amounts and are the exact amount every time (Ex: Rent or car payment)
    • - Variable expenses can change, which means you have more control over them
    • (Ex: What you spend on car gas or entertainment)
  • Benefits of a Budget
    • Will help you live within your means
    • Can help you save toward important goals
    • Forces you to evaluate and modify your spending patterns
  • Personal Budget
    • Two Main Parts:
    • Income
    • Expenses
    • One must balance the two in order to avoid debt.
  • Building Your Own Budget
    • When you’re in control of your spending, you are able to make clear, planned decisions on the best way to spend your money and make your money work for you.
  • Building Your Own Budget
    • Step 1: Consider Financial Goals
    • Write down long-term and short-term goals
    • Step 2: Estimate Income
    • Think about net income as well as other sources of income
    • Step 3: Estimate Expenses
    • Look at previous billing statements
    • Take note of fixed and variable expenses
  • Building Your Own Budget
    • Step 4: Plan for Savings
    • Aim to save anywhere from 3 to 9 months’ income to cover emergencies
    • Further savings should be invested appropriately (consider a 50/50 plan )
    • Step 5: Develop a Trial Budget
    • Fill out what you expect to earn and spend, then record actual income and expenses
  • The Envelope System
    • 1. Label an envelope for each spending category (savings, food, gas, entertainment)
    • 2. Record the planned amount on the appropriate envelope
  • The Envelope System
    • 3. As you receive money, place the planned amount in each envelope
    • 4. When you need to spend money, take cash out of the appropriate envelope
    • 5. When an envelope is out of cash, you’re done spending for that category!
  • 5 Reasons to SAVE Your Money!
    • Emergencies
    • Expensive Purchases
    • Recurring Expenses
    • Retirement
    • Special Goals