Budgeting

What is a budget?

• A calendar used to plan out your activities for the month

• A plan for spending and saving your money

• A plan to manage your time for the day

• A type of savings account

What is income?

• The money that you earn

• The money that you spend

• Making a withdrawal

• Making a phone call

Marshawn is trying to determine if an item at the mall is a NEED or a WANT. Which question will be most helpful?

• Will something bad happen if I don't have this?

• Do any of my friends have this item?

• How happy will this item make me?

• Will my teachers be excited if I buy this item, or will they be disappointed?

What is gross pay?

• The money that you earn before taking out deductions

• The money that you earn after taking out deductions

What is net pay?

• The money that you earn before taking out deductions

• The money that you earn after taking out deductions

Why should you use your NET pay when creating a budget?

• Your net pay will always be higher, so you'll have more money to spend

• Your net pay is a more accurate picture of how much money you have available to spend or save

• Your employer knows what your gross pay is, but you only know what your net pay is

• Once you have your net pay, you can figure out how much to deduct in taxes, and then you can do your budget