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Financial Literacy Grade 7 Lesson 10

Financial Literacy Grade 7 Lesson 10. SS.8.FL.2.5 Discuss the fact that people may revise their budget based on unplanned expenses and changes in income. Why is it important to have a budget? What are the necessary steps to create a budget?

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Financial Literacy Grade 7 Lesson 10

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  1. Financial Literacy Grade 7Lesson 10 SS.8.FL.2.5 Discuss the fact that people may revise their budget based on unplanned expenses and changes in income.

  2. Why is it important to have a budget? • What are the necessary steps to create a budget? • What unexpected events might create a need to revise your budget? Essential Questions: • Why is it important to have a budget? • What are the necessary steps to create a budget? • What unexpected events might create a need to revise • your budget?

  3. Reasons to create a budget: ■ To determine how much money you have to spend ■ To decide how you want to spend your money ■ To determine how to spend money in the future ■ To learn to live on less than available income ■ To stay out of financial trouble www.practicalmoneyskills.com the art of budgeting

  4. the budgeting process phase 1: Assess your personal and financial situation (needs, values, life situation). phase 2: Set personal and financial goals. phase 3: Create a budget for fixed and variable expenses based on projected income. phase 4: Monitor current spending (saving, investing) patterns. phase 5: Compare your budget to what you have actually spent. phase 6: Review financial progress and revise budgeted amounts. www.practicalmoneyskills.com the art of budgeting

  5. goal-setting guidelines for budgeting well-written personal and financial goals SHOULD: • be realistic • A student working part-time is not likely to be able to • afford a new car every couple of years. • be specific • “I want to save $5,000 for a down payment to buy a • house.” • have a timeframe • “I want to pay off my credit card within the next 18 • months.” • state the action to be taken • “I want to start an automatic deposit savings account • with monthly withdrawals from my checking account.” www.practicalmoneyskills.com the art of budgeting

  6. S.M.A.R.T. Budgets S : Specific- precise or exact M Measurable-something that can be measured A Attainable- capable of being accomplished R Realistic- something that is practical Timely- goal that can be reached within a time frame T

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