Personal Finance Project

1. Personal Finance Project Honors - Spring 2019

2. Introduction All the materials needed to complete your PFL Project can be found in this slide show. You will be working with several google docs and spreadsheets so it is recommended you create a folder in your Google Drive labeled “PFL” to house all of your work.

3. Grading There are 4 activities you will submit to Mr. Black • Car Loan Project due by 4/23 • Get a Job - due by 4/24 • Find Housing - due by 4/26 • Student Loan - due by 4/29

4. Grading Your final PFL project will count as a test grade. The project is made up of the following: • Final Budget • Life Happens Activity • Reflection

5. PERSONAL FINANCE PROJECT DUE TO TURNITIN.COM BY 9 pm on May 2nd Your project must be submitted as a single PDF file. Copy of the rubric can be found here.

6. STEP 1: Open the Salary-Based Budgeting worksheet, then click File → Make a copy and put it in your PFL Google Folder Name your worksheet “LAST NAME, FIRST PFL Budget” Close the original Salary-Based Budgeting worksheet Use your copy of the worksheet to record all the work for this project. 6

7. Steps 2-4: It’s tough to truly predict what you’ll be when you “grow up,” but this is a great opportunity to research the pay for jobs you’re interested in. Pick one job and complete the (1) Find a Job activity. Enter the data from the activity into your spreadsheet Step 2: Annual Gross Step 3: Monthly Gross Step 4: Net Wage (Monthly) 7

8. STEP 5: “Pay yourself first” by putting aside a percent of your net salary into a savings account. Choose one of the percents below, and calculate how much you’ll be saving off your net salary. 5% → this is low, but better than nothing 10% → this is a good goal for your first career; increase later 15% → terrific savings goal! Savings = Net Wage (monthly) * % savings (remember 5% = .05) 8

9. STEP 6: It’s never too young to start saving for retirement. You want to set aside another portion of your net salary to put toward retirement. 5% → this is low, but better than nothing 10% → this is a good goal for your first career; increase later 15% → terrific retirement goal! Retirement = Net Salary (monthly) * % retirement (5% = .05) 9

10. STEP 7: Calculate the total amount you’re saving each month. Total Monthly Savings = Monthly Savings Account + Monthly Retirement 10

11. STEP 8: Calculate the monthly amount you have to budget. **Savings is NOT an expense; it’s the money you’re setting aside for your own future. However, it’s also money that you shouldn’t spend on other things each month, so it gets taken out BEFORE you do your monthly budget. Monthly Amount to Budget = Net Salary (monthly) - Total Savings 11

12. STEP 9: RENT To determine how much you will spend on rent, choose the type of living situation you see yourself in. Option A: Live in an apartment/house by yourself Option B: Live in an apartment/house with roommates Go to the slide for your choice to determine your rent cost. 12

13. STEP 9A: RENT (Live in an apartment/house by yourself ) If you want to live completely on your own, use the (2) Find Housing activity. 13

14. STEP 9B: RENT (Live in an apartment/house with roommates) Option 2: If you are willing to live with roommates ($ saving!), use the (2) Find Housing activity Monthly Rent = rent price / # of people living there 14

15. STEP 10: Renter’s Insurance You want to have renter’s insurance, to cover replacement of your belongings in case of theft or apartment-wide damage (flood, fire, etc). Unless you have a lot of expensive stuff, you can budget $20 for Renter’s Insurance. 15

16. STEP 11a: Utilities • If you’re living on your own, you’ve got to pay the full costs. • With roommates, you get to split a lot (but not all) of these costs. • Remember to divide those bills by the # of people! 16

17. STEP 11b: Utilities Cable/Satellite (Choose 1) Internet Water Cell Phone (Choose 1 - cannot split with roommates) Gas/Electric 17

18. STEP 12: Calculate your total monthly budget for the cost of living. Cost of Living = Rent + Renter’s Insurance + Cable/Satellite + Internet + Home Phone + Mobile Phone + Electricity/Gas 18

19. STEP 13: Public Transportation (Buses, Trains, etc.) • If you’re living in a city (your rent must reflect this!) that allows you to get where you need via Public Transportation, and you’re not going to have a car at all, use one of the figures below: **If you will only use public transportation, you will complete the alternate Car Loan activity instead of researching your own car. 19

20. STEP 14: Car Payment • If you’re going to have a car, use the information from your Car Loan Activity given in class. Once complete, don’t forget to enter your monthly payment into your budget spreadsheet. **If you are using public transportation, you pay $0 for a car and can skip to step 16 20

21. STEP 15:Car Insurance Use the Car Insurance Activity and choose one type of car insurance. Make sure to enter this into your spreadsheet. STEP 16: Car Maintenance Assume $100 per month -- some months will be $0, but some will be expensive! Record this in your budget. 21

22. STEP 17: Gas Estimate how many miles you’ll drive per day and use this chart to find your gas prices (based on $3.55/gallon and 23.6mi/gallon): 22

23. STEP 18: Calculate your total monthly budget for transportation. Cost of Transportation = Public Transportation + Car Payment + Car Insurance + Car Maintenance + Gas 23

24. STEP 19: Choose which meal plan you’re likely to follow for the cost of Groceries: 24

25. STEP 20: Choose which plan you’re likely to follow for the cost of Dining Out: 25

26. STEP 21: Calculate your total monthly budget for food. Cost of Food = Groceries + Eating Out 26

27. Calculate the cost of your insurance STEP 22: Health Insurance • Employer Provided: $85/month • Self-employed/Contract Employment: $440/month STEP 23:Dental Insurance(optional) • Employer Provided: $15/month • Self-employed/Contract Employment: $50/month STEP 24:Vision Insurance (optional) - $30/month 27

28. STEP 25: Haircare If you already know how much you pay for a haircut, enter it. If you’re not sure, use the US averages: Barber $28 Salon $44 **If you only get a haircut every 3 months, divide the cost by 3. STEP 26: Other Grooming/Hygiene Everyone’s different, but let’s assume a minimum $25/mo for other hygiene, medication, grooming, or personal needs. Budget more if you know you’ll spend more. 28

29. STEP 27:Gym Membership Remember, the first step to wealth is health! If you don’t workout, or you do it free outside or at home, $0. Otherwise, assume $58/mo for a gym membership. 29

30. STEP 28: Calculate your total monthly budget for health. Cost of Health = Health Insurance + Dental Insurance + Vision Insurance + Haircuts + Other Grooming/Hygiene + Gym Membership 30

31. STEP 29: Student Loan Payments Most students will graduate with student loan debt. Use the (4) STUDENT LOAN Activity to estimate how much you will need to pay monthly to pay off your loans. Once you select your plan, add it to your budget sheet. 31

32. STEP 30: Discretionary Spending So far, your budget is neglecting FUN STUFF (clothes, going out with friends, entertainment, new technology, gift giving, donations, travel, vacations, a morning coffee, etc). In the Wants category, record how much you’d like to be able to spend on these items (total) per month. 32

33. STEP 31: Monthly Spending It’s time to figure out how much you’re spending each month: Total Costs = Cost of Living + Transportation + Food + Health + Student Loan + Wants 33

34. STEP 32: Balance At the end of the month, how do your finances look? • Do you spend less than you earn? You have a surplus, or money left over -- that’s good! • Do you spend more than you have in your budget? You have a deficit, or expenses not covered by your earnings -- that’s bad! Balance = Monthly Amount for Budget - Total Costs 34

35. Now that you’ve done the budget once through, you have a basic understanding of the components of a typical adult’s budget. Unfortunately, life happens! You will complete one extension activity assigned by your teacher/you choose. The extensions are available on the next slide. 35

36. Life Happens! • Credit Card Issues • Plan a Trip • Medical Expenses • Budgeting for Baby • Plan an Event

37. Next, continue on to the Reflection. Use your Salary-Based Budgeting Worksheet, Life Happens activity, and this presentation as reference.

38. How to submit: • Make sure project is in proper order (Budget, Life Happens, Reflection) • Save as a PDF. Make sure it is all one document. You can either copy and paste everything into one document or combine PDFs. • Submit to turnitin.com. Class codes will be posted on my Weebly.

39. PERSONAL FINANCE PROJECT DUE TO TURNITIN.COM BY 9 pm on May 2nd

40. Some helpful tips! • Too much text for your cell in excel? Select the cell, select Formatting from the drop down toolbar, select Text Wrapping, click wrap. • Select Portrait for your excel sheets when saving. This will ensure your documents will be the same orientation for submission. • Use the clipping tool to grab screenshots of sources. You’ll be able to copy and paste them into your documents.