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Accompanying slide show - NCV 2 Mathematical Literacy Hands-On Training published by Future Managers (www.futuremanagers.net)

Accompanying slide show - NCV 2 Mathematical Literacy Hands-On Training published by Future Managers (www.futuremanagers.net)

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- 1. Finances Future Managers Mathematical Literacy 2 1
- 2. Income, Expenses and Financial Planning Mathematical Literacy pg 48 Future Managers Mathematical Literacy 2 2
- 3. Finance • Income, expenses and financial planning • Read financial information and make decisions Future Managers Mathematical Literacy 2 3
- 4. Identify, record and manage your income • Income is the money that you have earned during a specific period, either by selling your own goods and services or working for a wage or salary • Salaries are paid on a monthly basis • Wages are paid per hour Future Managers Mathematical Literacy 2 4
- 5. Gross and Net Income • Gross Income is that amount of money that you will cost the company • Net Income is the amount of money that you will receive • The difference is made up of taxes, medical aid, pensions, unemployment taxes (for wage workers) etc Future Managers Mathematical Literacy 2 5
- 6. Fixed Income • Salaries and Wages • Income from property Future Managers Mathematical Literacy 2 6
- 7. Variable Income • Commission earned • Interest received on investments • Tips in the case of waiters or waitresses Future Managers Mathematical Literacy 2 7
- 8. Expenses • Expenses is the collective name for all the things that you spend money on Future Managers Mathematical Literacy 2 8
- 9. Fixed Expenses • Occur every month. Don’t generally change much from month to month • Examples – Rent – Loan repayments – Hire purchase agreements Future Managers Mathematical Literacy 2 9
- 10. Variable expenses • Change from month to month • You generally have more control over variable expenses • Examples: – Electricity – Haircuts – Entertainment – Food Mathematical Literacy pg 51 Future Managers Mathematical Literacy 2 10
- 11. Recording your income and expenses • Record where your income and expenses are going • Tips for keeping record – Keep a notebook handy and write down immediately what you bought – Collect a till slip for each payment – Record the amount that you take with you when you go out, and what you have left at the end – Use bank statements Future Managers Mathematical Literacy 2 11
- 12. Saving • Reasons for saving – Avoid financial worries – Keep out of debt – Retirement – Have interest working in your favour, rather than against you Future Managers Mathematical Literacy 2 12
- 13. How can I save? • Buy necessities first and luxuries last • Take advantages of benefits available • Budget carefully and plan in advance • Get the best quality for the lowest price • Try to get what is needed without spending your money on it • Negotiate prices and ask for discounts • Don’t buy on debt. Save until you have enough money Future Managers Mathematical Literacy 2 13
- 14. How interest rates are calculated • Interest is the amount that the bank pays into your account • They are calculated as a percentage of the amount in you account • A 10% interest rate means that if you keep R100 in your bank account, you will get R10 back per year Future Managers Mathematical Literacy 2 14
- 15. Ways of Saving • Joining your employer’s pension of provident fund • Putting your money in a savings account • Joining a savings club or stokvel • Taking out insurance to cover losses to yourself and your possessions • Put away amounts into a less accessible interest earning account Future Managers Mathematical Literacy 2 15
- 16. Frequently Asked Questions • Isn’t it better to buy now and save on increased costs later? • Can buying on credit help me? • Cana I on paying off my load or making down payments? • What is inflation? • What are stokvels? • What are Pyramid Schemes? Future Managers Mathematical Literacy 2 16
- 17. Income Statement • An income statement provides a history of your financial matters. It reports on how much you have earned and what you did with it • A basic income statement should: – Group together all income items and total them – Group together all expense items and total them – Deduct the total expenses from the total income to indicate the net income for the period Mathematical Literacy pg 58 Future Managers Mathematical Literacy 2 17
- 18. Income Statement for previous month (March) Income Salary of father R5 600,00 Salary of mother R 1950, 00 Interest earned R44, 66 R7, 595,00 Expenses R7 556,00 Fixed Expenses Monthly rent R2 050,00 Insurance and funeral policies R 400,00 Transport by taxi R300,00 School fees for younger sister R265,00 Variable Expenses Clothes R250,00 Medical R 146,00 Water and electricity R265,00 Telephone R480,00 Food and household goods R2 850,00 Savings R250,00 Entertainment R300,00 Net Income (Income less expenses) R39,00 Future Managers Mathematical Literacy 2 18
- 19. Budgeting • A budget is an estimate of expected income and expenditure done on a monthly basis for an individual or household • Actual income and expenses are recorded accurately and then used to plan for future income and expenses • A budget is a summary of all your projected earnings and expenses in the immediate future • A budget helps you avoid debt • A budget provides motivation and control • All business and even the country uses budgets Mathematical Literacy pg 58 Future Managers Mathematical Literacy 2 19
- 20. Read Financial Information and Make Decisions Future Managers Mathematical Literacy 2 20
- 21. Finance • Income, expenses and financial planning • Read financial information and make decisions Future Managers Mathematical Literacy 2 21
- 22. Financial Documents Financial Documents Bank Deposit Pay Slip Quotes Statement Slip Utility Bill Receipt Accounts Cheque Future Managers Mathematical Literacy 2 22
- 23. Bank Account • A bank account is a safe storage to deposit a salary as it is earned • Any cheque payments received have to pass through a bank account • Your salary will be deposited into your bank account • You earn interest on money in your account • Banks charge you for every transaction on your account • Before opening an account compare the costs between banks Future Managers Mathematical Literacy 2 23
- 24. Bank Charges • All banks charge for the administrative work that they do with regard to your money • ATM transactions are cheaper than counter transactions • Internet and cell phone banking is cheapest, but requires a monthly payment and internet access Future Managers Mathematical Literacy 2 24
- 25. Types of Bank Accounts • Current account – more expensive to operate than savings account but gives you access to cheques, no interest • Savings account – collects interest, withdrawals from ATM or debit card • Fixed deposit – requires you leave your money in the bank for a fixed period, earns higher rates than a savings account Future Managers Mathematical Literacy 2 25
- 26. Reading your bank statement • Banks issue statements, usually on a monthly basis • They include debits (expenses) and credits (income) • They should be self-explanatory Future Managers Mathematical Literacy 2 26
- 27. Wonder Bank Ltd 23 Factory Road BIESIESFONTEIN 5066 Bank statement from: 17/05/07 to 31/06/07 Savings Account Mr Sipho Mkize Apartment 67 Biesieshof Biesiesfontein 5061 Date Branch Description Funds In Funds out Balance (R) 1705/07 Biesiesfontein Str Cash dep 100,00 B/f 0.00 19/05/07 Biesiesfontein Str Cheque dep 200,00 100,00 19/05/07 Head Office Electronic dep 5000,00 2 100,00 31/05/07 Head Office CR Interest 25,63 7 100,00 31/05/07 Head Office Monthly fee 2,00 7 125,63 30/05/07 Head Office Cr interest 59,58 7 123.63 30/06/07 Head Office Monthly fee 2,00 7 183,61 10/07/07 Pick ‘n Pay PNP P&C free 435,87 7 181,21 10/07/07 Pick ‘n Pay PNP purch CB 0,55 6 745,34 fee 19/07/07 Head Office Electronic dep 5 000,00 6 744,79 25/07/07 Biesiesfontein Str Cheque dep 535,00 ? 26/07/07 ATM FonteinStr Cash Withdrawal 500,00 ? Mathematical Literacy 2 31/07/07 Head Office Monthly fee 2,00 ? Future Managers 27
- 28. Cheques • A cheque is a safe way of paying a large amount of money • It costs a lot of money to write a cheque Future Managers Mathematical Literacy 2 28
- 29. Writing Cheques • The date must be filled in correctly – Post dated means it cannot yet be cashed – Stale means that the cheque is older than three months • The amount must be written in words as well as numbers • Cents can be filled in as a fraction • The signature must be of the account holder • Crossed Cheque • Cheque stubs – for personal record Future Managers Mathematical Literacy 2 29
- 30. Crossed Paid to Amount written Signatur out in full e Mathematical Literacy 2 Future Managers 30
- 31. Deposit Slip Future Managers Mathematical Literacy 2 31
- 32. Deposit Slip • The following information is required: – Date – Person who receives the deposit – Your account number – The depositors name – Contact number of the depositor – Signature – Cash details – total amount in notes and coins – Cheque details Future Managers Mathematical Literacy 2 32
- 33. Pay Slip Sparkie Welders (Pty) Ltd Employee name: Mr B. Mokoena Walter Sisulu Drive ID no: 686070068092 Botshabelo Payment date: 25/04/08 3488 Part time hours Earnings Deductions 25,50 4011,15 Tax: 1002,79 UIF: 40,11 Nett Pay 2968,25 Future Managers Mathematical Literacy 2 33
- 34. Pay Slip • Information that must appear: – Employer and employee details – Salary amount – Taxable amount – UIF contribution – Company contributions – Leave due Future Managers Mathematical Literacy 2 34
- 35. Receipts Future Managers Mathematical Literacy 2 35
- 36. Receipts • A receipt is evidence of payment • These should be kept for personal records and for tax purposes Future Managers Mathematical Literacy 2 36
- 37. Utility Accounts Future Managers Mathematical Literacy 2 37
- 38. Utility Accounts • Utility accounts are for services that the local municipality provides • They must be paid monthly • The more you use, the higher the rate per unit Future Managers Mathematical Literacy 2 38
- 39. Utility Accounts • The following information will appear on a utility account: – Your details – Type of service – Rate – Usage – Free amount – Date of the reading – Outstanding amount – Amount payable Future Managers Mathematical Literacy 2 39
- 40. Retail Accounts Future Managers Mathematical Literacy 2 40
- 41. Retail Accounts • Allows you to buy from the shop on credit • Designed to encourage loyalty to the shop • Charge interest • Payments are made monthly Future Managers Mathematical Literacy 2 41
- 42. Travel Costs • Travel costs generally make up a significant part of our daily expenses • It is generally cheaper to buy a monthly ticket for public transport • However, there is a risk of losing the ticket Future Managers Mathematical Literacy 2 42
- 43. National Credit Act • Aims to protect the customer against unfair and unlawful credit provision • Aims to educate customers about their rights • Applies to all credit agreements Future Managers Mathematical Literacy 2 43
- 44. Benefits of the NCA • Ban negative marketing • Will hear complaints about credit providers • Hand out penalties to credit providers • Issue an order to declare the details of the agreement on your behalf • Provides you information before entering into a credit agreement • Requires a credit provider to give you a quotation • Credit providers must show all the costs • Credit providers must inform you that they are going to give negative information to the credit bureau • Credit bureaus must give you a copy of your credit record on request Future Managers Mathematical Literacy 2 44
- 45. NCA • Credit providers must ask you for the following information: – Pay slip – ID Document – List of existing debt with other credit providers – A personal budget – A utility bill – A declaration of financial ability Future Managers Mathematical Literacy 2 45

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