Needs Vs. Wants
What is a need ?
Essentials required to live and function.
What is income ?
Any money earned or received over time.
What is savings ?
Money purposely put away for future goals or unexpected expenses.
$15+$25=
$40
What is 50/30/20 means ?
50% needs
30% wants20% savings
What is a want?
Something enjoyable or entertaining but not essential
What is a budget ?
A plan that helps you use every dollar wisely.
Why do people save money ?
To prepare for future goals or unexpected expenses.
$40+$60=
$100
What happens if you spend more than you income ?
You may run out of money (No Money).
Is a winter coat a need or want ?
Need
What are expenses ?
Money purposely put away for future goals or unexpected expenses,
If you have $120 and spend $100, how much can you save ?
$20
$120-100
$20
A student has $100. They need shoes for PE but also want $90 sneakers. What should they consider before buying ?
A cheaper or less expensive sneaker.
Why is a concert ticket a want ?
Because it is entertainment and is not essential for living and functioning.
Why should you have a budget ?
To plan your spending, cover necessary expenses, save and avoid running out of money
Which account do you put money in for savings ?
Savings account
If you have $180 and spend $125, how much remains?
$55
I got paid $2468 for the month how can I use the 50/30/20 percent rule to give myself a budget.
20%:$493.06
Can something be both a need and a want ? Explain
Yes an can be an need, but choosing an expensive version can turn there extra cost into a want
What does it mean to have a balanced budget ?
Your total expenses are equal to or less than your starting income.
Why is it important to include savings in a budget ?
So every dollar has a purpose and you are planning for the future.
If you have $250 and spend $175, how much money remains ?
$75
What is a spending cap ?
The total limit you are allowed to spend when having a budget.