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Personal Monthly Budget: Managing Your Finances

Learn how to create a personal monthly budget to track your income and expenses. Avoid financial difficulties by properly managing your finances.

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Personal Monthly Budget: Managing Your Finances

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  1. Your Financial FutureLevel 2 UK Edition September 2011

  2. Activity 4: Preparing a Personal Monthly Budget • A budget is a plan for how to spend, save, and invest the money you make. It helps you keep track of how much you earn and how much you spend. • Money you receive, such as what you make from a job, pocket money or an allowance, or even gifts, is called income. Money you spend on school supplies, clothes, food, birthday gifts, and entertainment is called expenses or outgoings. • If you spend more than you earn, you will have a budget deficit, or loss. If you spend less than you earn, you will have a budget surplus, or gain. Bank of America Merrill Lynch

  3. Activity 4: Preparing a Personal Monthly Budget One of Charles Dickens most well known characters was Wilkins Micawber, who spent most of his life in a state of financial difficulty. Micawber says: "Annual income twenty pounds, annual expenditure nineteen, nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds, nought and six, result misery." This is as true today as it was in the 1849, only the amounts have changed. Monthly Income £40.00 Monthly Expenses £60.00 Difference (income minus expenses) £(20.00) deficit “Result – Misery” Monthly Income £50.00 Monthly Expenses £30.00 Difference (income minus expenses) £20.00 profit “Result – Happiness” Bank of America Merrill Lynch

  4. Activity 4: Preparing a Personal Monthly Budget • Complete the Personal Monthly Budget worksheet. Only complete the ‘Projected’ column for now – what you think your budget will be. This should take approximately 20 minutes. • I will ask for volunteers to read their budget to the class. Bank of America Merrill Lynch

  5. Activity 4: Preparing a Personal Monthly Budget • Review: • What were some of the projected incomes in the class for the month? Highest, lowest? • What were some of the projected expenses for the month? Highest, lowest? • Do you have budget surpluses or deficits? ? Bank of America Merrill Lynch

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