Budgeting Needs & Wants

The Basics of Budgeting

Think of it as a road map for your personal finance ​

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WHAT IS A BUDGET?

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• a plan for spending and saving

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Use SMART Goals setting to balance the scales​

​Starting out

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• Determine my income and expenses

• Identify my financial goals (immediate, short-term, long term)

Your needs should always take priority

Wants vs Needs​

• Discretionary Expenses are wants

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• Non-discretionary Expenses are needs

Poll

Can something be both a need and a want?

• Yes, there are examples of both

• No, you can either want or need you can do both

You need a pair of shoes

​But you want a pair of Jordans

One shoe costs about 3x as much money, but they both protect your feet

Your values help to determine what's important

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• FIXED Expenses that you pay every month and the amount stays the same.

  VARIABLE Expenses that you pay every month but the amount changes.

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BOTH can be non-discretionary

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​Fixed Expenses vs. Variable Expenses

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How much money do you have coming in?

​​Determine Income

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How much is going out every week/bi-weekly/monthly?

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(Fixed/Variable/Discretionary)

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​​Determine Expenses

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​Make the two balance out!

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(Hopefully you got a little left to save)​

Do the math!​

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​STEPS TO CREATING A BUDGET

Multiple Choice

An item that is necessary for life

• Value

• Want

• Need

• Well-Being

Multiple Choice

Something that is

unnecessary to life, but desired.

• Value

• Want

• Need

• Well-Being

Multiple Choice

 

Which option is a Need?

• Car

• Cell Phone

• Air pods

• Shoes

Multiple Choice

 

What is an example of Wants

• Food

• Cell Phone

• Water

• Shelter

Poll

Where are Americans spending more money?

• Groceries

• Restaurants