Family Economics & Financial Education

1. Family Economics & Financial Education 3.19.5.G1 Get ready to Take Charge of Your Finances Life Of….. Carlos Chavez “A Teenager’s Spending Plan”

2. Snapshot – Carlos Chavez • Sneak peak into the life of Carlos and his family • Carlos • Nana (Martha) • Jorge • María • Adriana • Marco

3. SnapshotCarlos' Income and Expenses • Carlos' Income • Sunshine Inn • $8.50/hour • 10 hours a week

4. Carlos' Expenses Extracurricular Activities Youth group ski trip $5.00 per month Track expenses $2.50 per month Transportation $100.00 Saving Family Support $40.00 per month College expenses $50.00 per month Lunch $24.00per month Others SnapshotCarlos' Income and Expenses

5. Spending Plan • The goal is to create a spending plan that balances Carlos' expenses with his income. • He cannot have more expenses than income. • Spending Plan • Financial statement • Tracks income and expenses • Used to assist with money management and help the family reach financial goals • An family’s perception of needs, wants and values will affect decisions made when creating a spending plan

6. Carlos' Expenses Housing Monthly Payment Utilities Others – television, internet and telephone Transportation Vehicle for María Monthly payment and fuel Bus pass for Jorge Insurance Homeowners, disability, life, auto, and health Food Groceries School lunches Savings and Debt Savings of $125 per month for retirement and future college expenses Monthly medical payments of $155.00 SnapshotChavez Family Expenses

7. Housing • Monthly Payment • Housing payment • Insurance • Property taxes • Repairs • Maintenance • Utilities • Heat • Electricity • Water • Sewer • Garbage

8. Housing Others • Digital Cable • Add Ons • Telephone • Cellular Phone • Internet

9. Monthly Payment Car payment Maintenance Fuel An average is listed This cost may increase/decrease depending on the cost of fuel Chavez Family Pay for María's monthly payment and fuel costs Bus Pass Transportation

10. Others • Running Supplies • Downhill Ski Supplies • Electronics • Video Games • Entertainment • Cellular Phone • Create Your Own

11. Goal:To Create A Balance Spending Plan • Make all choices for the Chavez family and Carlos • Complete a Major Expenditures Summary for the Chavez family • Complete a Spending Plan for Carlos • Answer reflection questions • Write a summary essay

12. Quick Review • Chavez Family • Carlos, Nana (Martha), Jorge, María, Adriana, Marco • Create a Major Expenditures Summary for the Chavez Family • Housing • Transportation • Create a Spending Plan for Carlos • Extracurricular Activities • School Lunches • Savings • Others

13. Snapshot Reflection • Review Carlos' Snapshot on pages 2-4 • Answer questions 1-5 on page 10

14. Personal Information Carlos' Paycheck State the employee’s name, address, and social security number.

15. Pay Period Carlos' Paycheck The length of time which an employee’s wages are calculated.

16. Gross Pay Carlos' Paycheck The total amount of money earned during the pay period before payroll withholdings.

17. Payroll Withholdings Carlos' Paycheck The amount of money subtracted from the gross pay for taxes.

18. Withholding Tax Carlos' Paycheck The amount required by law for employer to withhold from earned wages to pay taxes.

19. FICA Carlos' Paycheck Federal Insurance Contribution Act – includes Social Security and Medicare

20. Net Pay Carlos' Paycheck The amount of money remaining after all payroll withholdings have been removed from gross pay.

21. Year-to-Date Carlos' Paycheck Totals of the deductions which have been withheld from an individual’s paycheck from January 1 to the last day of the pay period indicated on the paycheck stub.

22. Setting Education and Financial Goals • Short Term – less than one year • Long Term – more than one year SMART Goal Specific State exactly what is to be done. Measurable Include how the goal can be measured. Attainable Determine steps to reach the goal. Realistic Do not set the goal for something unrealistic. Time Bound State when the goal will be met.

23. Chavez’s Major ExpendituresHousing • Choose a house and housing others for the Chavez family • Refer to the Snapshot on pages 2-4 • Remember • Family size • Lifestyle • Other family dynamics

24. Chavez’s Major ExpendituresTransportation • Choose a vehicle for María • Refer to the Snapshot on pages 2-4 • Remember • They need enough room in the vehicle for the family and supplies when they take trips together

25. Chavez’s Major ExpendituresMajor Expenditures Summary • Transfer numbers to complete the summary • Total housing cost • Total transportation cost • Insurance • Food • Savings and Debit • Each month $125.00 is saved for retirement and future college expenses • Each month $155.00 is paid to help a medical debt of $11,000

26. Carlos' Spending PlanPayroll Withholdings • Review Carlos' paycheck on page 11 • State Withholding Tax • Federal Withholding Tax • FICA

27. Carlos' Spending PlanSavings • Review Carlos' Snapshot on pages 2-4 • Identify his needs, wants, values • Review the short term and long term goals set for Carlos on page 12

28. Carlos' Spending PlanOthers • Extracurricular Activities • School Lunches • Choose which “others” items Carlos would like • Running Supplies • Downhill Ski Supplies • Electronics • Video Games • Entertainment • Create Your Own • Draw an item and identify the cost in the space provided

29. Carlos' Spending Plan Summary • Gross Income • Expenses • Calculate the Difference • If the difference is a negative number, go back and adjust some of Carlos' expenses.

30. Negative or Positive Difference? • If the number on XX is positive, adjust Carlos' expenses. • Saving additional money for unexpected emergencies or expenses may be a good idea. • If the number on XX is negative, go back and make adjustments to Carlos' expenses. • Changes need to be made consistently throughout the simulation. • Keep in mind Carlos' needs, wants, values and goals when making changes. • If the number on XX is zero, congratulations! You have balanced Carlos' Spending Plan!

31. Reflection Questions • Once the difference equals zero…. • Answer questions 17-22 on pages 15 and 16 • Answer questions 23-27 on page 18