Earning Income and Savings

Earning Income and Savings

Financial Literacy Skills Part 1

​BIG IDEA:

“The key to financial freedom and great wealth is a person’s ability or skill to convert earned income into passive income and/or portfolio income.”

Robert Kiyosaki

​ESSENTIAL QUESTION via DF

​Why is saving important and crucial after income earning?

​Q

Multiple Choice

It refers to the money or the equivalent value that an individual or business receives, usually in exchange for providing a good, service, or through investing capital.

• Savings

• Income

• Insurance

​INCOME

​- money or the equivalent value that an individual or business receives, usually in exchange for providing a good, service, or through investing capital

​Classifications of Income

​PASSIVE and ACTIVE

​Q

Multiple Choice

It refers to an income received after performing a service.

• PASSIVE INCOME

• ACTIVE INCOME

​ACTIVE INCOME

- ​an income received after performing a service

​(earned income)

​PASSIVE INCOME

​- earnings derived from a rental property, limited partnership, or other enterprise in which a person is not actively involved

​Q

Multiple Choice

Identify this kind of income as ACTIVE or PASSIVE.

"RENTAL INCOME"

• ACTIVE INCOME

• PASSIVE INCOME

Multiple Choice

Identify this kind of income as ACTIVE or PASSIVE.

"SALARY"

• ACTIVE INCOME

• PASSIVE INCOME

Multiple Choice

Identify this kind of income as ACTIVE or PASSIVE.

"COMMISSIONS"

• ACTIVE INCOME

• PASSIVE INCOME

Multiple Choice

Identify this kind of income as ACTIVE or PASSIVE.

"HOURLY WAGE"

• ACTIVE INCOME

• PASSIVE INCOME

Multiple Choice

Identify this kind of income as ACTIVE or PASSIVE.

"AFFILIATE INCOME"

• ACTIVE INCOME

• PASSIVE INCOME

Open Ended

Which is better: Active Income or Passive Income? Explain your answer.

​sQUIZ Game

Multiple Choice

It refers to the money left over after subtracting consumer spending from disposable income.

• INSURANCE

• INCOME

• SAVINGS

• EXPENSES

​PERSONAL EXPENSES

​- expenses of an individual other than those for business or investment purposes

Multiple Choice

It is an expense whose total amount does not change when there is an increase in an activity.

• VARIABLE EXPENSE

• FIXED EXPENSE

• OCCASIONAL EXPENSE

Multiple Choice

It is an expense whose amount may change from time to time.

• VARIABLE EXPENSE

• FIXED EXPENSE

• OCCASIONAL EXPENSE

Multiple Choice

It costs that come up throughout the year that needs to be budgeted for.

• VARIABLE EXPENSE

• FIXED EXPENSE

• OCCASIONAL EXPENSE

• SURPRISE EXPENSE

Multiple Choice

a money that is intended or expected to spend

• PLANNED EXPENSE

• UNPLANNED EXPENSE

Multiple Choice

expenses that was not seen coming

• PLANNED EXPENSES

• UNPLANNED EXPENSES

Open Ended

Do you have any clarifications or questions?