The document focuses on financial literacy for future managers, covering topics such as income, expenses, budgeting, and saving strategies. It explains the differences between gross and net income, fixed and variable expenses, and provides guidance on recording financial information and making informed decisions. Additionally, it touches on bank accounts, financial documents, and the National Credit Act aimed at protecting consumers.

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
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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
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6. Fixed Income
• Salaries and Wages
• Income from property
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7. Variable Income
• Commission earned
• Interest received on investments
• Tips in the case of waiters or waitresses
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8. Expenses
• Expenses is the collective name for all the things
that you spend money on
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9. Fixed Expenses
• Occur every month. Don’t generally change
much from month to month
• Examples
– Rent
– Loan repayments
– Hire purchase agreements
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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
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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
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12. Saving
• Reasons for saving
– Avoid financial worries
– Keep out of debt
– Retirement
– Have interest working in your favour, rather than
against you
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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
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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
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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
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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?
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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
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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
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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
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20. Read Financial Information
and Make Decisions
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21. Finance
• Income, expenses and financial planning
• Read financial information and make decisions
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22. Financial Documents
Financial Documents
Bank Deposit Pay Slip Quotes
Statement Slip
Utility Bill Receipt Accounts Cheque
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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
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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
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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
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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
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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 ?
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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
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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
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30. Crossed Paid to
Amount written Signatur
out in full e
Mathematical Literacy 2
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31. Deposit Slip
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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
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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
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34. Pay Slip
• Information that must appear:
– Employer and employee details
– Salary amount
– Taxable amount
– UIF contribution
– Company contributions
– Leave due
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35. Receipts
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36. Receipts
• A receipt is evidence of payment
• These should be kept for personal records and
for tax purposes
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37. Utility Accounts
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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
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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
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40. Retail Accounts
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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
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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
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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
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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
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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
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