Budgeting - An Introduction

Budgeting - An Introduction

What is a budget?

A budget is: An estimate of income and expenditure over a period of time.

Estimate: An approximate calculation

Income: Money received through work/investments

Expenditure: An amount of money Spent

Multiple Select

An estimate of income and expenditure over a period of time is a...

• Income

• Budget

• Currency

• This one should be easy. Why are you even looking at this option.

A budget is a plan to spend less than you earn each month.

Simply put.

Multiple Select

A _________ is an approximate calculation or judgement of the value

• Estimate

• Budget

• Expenditure

• Income

Multiple Select

An amount of money spent is a/an

• Budget

• Expenditure

• Estimate

• Income

Multiple Select

Money received, especially on a regular basis, for work or through investments ia an

• Expenditure

• Income

• Budget

• Time

Poll

Who here has had to make a budget before?

• I have

• I have not

Open Ended

What have you personally had to budget for?

or

What would you like to budget for in the future?

What have you personally had to budget for?

What would you like to budget for?

Budgeting is NOT about restrictions, it is about freedom!

• Allows you to plan for the future

• Save for the future

• You are more in control

• Less stressed

• More confident

• And you will find extra money to buythings you actually want! Not just the Essentials. (Shelter, Food, Clothing*, Water)

• *Not all 'clothing' would be considered 'Essential'

Essential Items on your budget

Essential Items include: Electricity, Rent, Food, Loans,

...phone plan? Internet?

Essential Items are things that you NEED. These are the things that you budget to pay for first!

Non-essential Items.

Items that are NOT A NECESSITY. This means, items that you could go without.

Examples; Movie tickets, Junk foods, gym memberships, that second purse that matches your jacket, Xbox membership.

Multiple Select

Check all the items that would be considered 'Essential Items'

• Ray Bans

• Electricity

• Rent

• A cool pen

• Candy

Multiple Select

Check all the items that we would consider 'Non-Essential Items'

• Water

• Healthy foods

• A second purse

• A model airplane

Once we have completed our budget, we will know if we have a deficit or a surplus of money

Surplus or a Deficit

Surplus: When you have extra money after paying for everything on your budget.

Deficit: When you have less money after paying for everything on your budget

Multiple Select

Max has just finished his budget for the week.

He makes $200 mowing grass. He pays for his phone plan $50, Movie Tickets $40, $60 for video games and $70 for food.

Does he have a surplus or a deficit?

• Surplus

• Deficit

He has a deficit - Max has spent more than he has made! uh-oh. Let's think of ways to balance his budget.

• a 'Balanced Budget' is when income is equal to or greater than expenses paid.

• He could - Decrease expenses,

Income: $200 mowing grass.

Phone plan $50

Movie Tickets $40

Video games $60

$70 for food.

How will be balance his budget?

• He Could....

  Increase income

• Decrease expenses

Practise Budget...

Practice budgets: Example

Hine works at Pak n Save Rangiora and earns $185 per week, she also babysits her neighbour's children a few days a week and gets paid $50. She has the following essential spending: She has to pay her dad back for a loan he gave her to purchase an iphone at $50 per week, and puts $20 into her savings account. She pays $20 a month for her prepaid account. Non essential spending - $200 per month for a gym membership and she likes to have $30 per week for buying food and make-up. Hine really wants to save up and go to Auckland to the six60 concert next year. She needs to save $1000 to do this. How long will it take her to save up?