Family Economics & Financial Education

1. Family Economics & Financial Education 3.19.4.G1 Get ready to Take Charge of Your Finances Life Of….. Mandy Gonzales “A Teenager’s Spending Plan”

2. Snapshot – Mandy Gonzales • Sneak peak of the life of Mandy and her family • Mandy • Carmine • Bobby • Lolita • Connie • Roberto

3. SnapshotMandy’s Income and Expenses • Mandy’s Income • Tasty Freeze • $6.75/hour • 16 hours a week

4. SnapshotMandy ’s Income and Expenses • Mandy ’s Expenses • Cellular phone $75 per month • Savings $100 per month for extra curricular activities • Fuel $50 per month • Other

5. Spending Plan • The goal is to create a spending plan the balances Mandy ’s expenses with her income. • She cannot have more expenses than income. • Spending Plan • Financial statement • Tracks income and expenses • Used to assist with money management and help individuals reach financial goals • An individual’s perception of needs, wants and values will effect decisions made when creating a spending plan

6. SnapshotGonzales Family Expenses • Housing • Utilities and Taxes • Maintenance • Others – television, internet, and telephone • Transportation • One family vehicle monthly payment • Fuel for Roberto’s car • Half of the cost of fuel for the car shared by Mandy and Connie • Insurance • Homeowner’s, health, life, auto • Food • Groceries • Credit card debt

7. Housing • Gonzales Expenses • Utilities • Property taxes • Maintenance • Additional Expenses • Housing Payment • Insurance • Utilities • Heat • Electricity • Water • Sewer • Garbage • What is the impact on the family of not having a housing payment because they live in Lolita's home?

8. Housing Others • Satellite Dish • Digital Cable • Telephone • Internet

9. Transportation • Monthly Payment • Car payment • Maintenance • Fuel • An average is listed • This cost may increase/decrease depending on the cost of fuel • Gonzales Family • Monthly payment, and fuel costs for Roberto’s vehicle and half of the fuel costs for Connie and Mandy’s shared car. • Mandy • Pays half of her vehicle’s fuel costs

10. Others • Personal items • Entertainment • Music • Cheerleading • Miscellaneous • Create Your Own

11. Goal:To Create A Balanced Spending Plan • Make all choices for the Gonzales family and Mandy • Complete a major expenditures summary for the Gonzales family • Complete a spending plan for Mandy • Answer reflection questions • Write a summary essay

12. Quick Review • Gonzales Family • Mandy, Carmine, Bobby, Lolita, Connie, Roberto • Create a Major Expenditures Summary for the Gonzales’ • Housing • Transportation • Create a Spending Plan for Mandy • Savings • Transportation fuel costs • Others

13. Snapshot Reflection • Review Mandy ’s Snapshot on pages 2-4 • Answer questions 1-5

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

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

16. Mandy ’s Paycheck Gross Pay The total amount of money earned during the pay period before payroll withholdings.

17. Payroll Withholdings Mandy ’s Paycheck The amount of money subtracted from the gross pay for taxes.

18. Withholding Tax Mandy ’s Paycheck The amount required by law for employer to withhold from earned wages to pay taxes.

19. Mandy ’s Paycheck FICA Federal Insurance Contribution Act – includes Social Security and Medicare

20. Net Pay Mandy ’s Paycheck The amount of money left after all payroll withholding have been taken from the gross pay.

21. Mandy ’s Paycheck Year-to-Date Totals of all 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 Financial Goals • Short Term – less than one year • Long Term – more than one year

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

24. Gonzales’ Major Expenditures Transportation • Choose a vehicle for the Gonzales family and Mandy • Refer to the Snapshot on pages 2-4 • Remember • Family size • Number of vehicles available

25. Gonzales’ Major ExpendituresMajor Expenditures Summary • Transfer numbers to complete the summary • Discuss how the credit card balance impacts the family • How can a family help to decrease the cost of food per month? • Why is automobile and health insurance important?

26. Mandy ’s Spending PlanPayroll Withholdings • Review Mandy ’s paycheck on page 11 • State Withholding Tax • Federal Withholding Tax • FICA

27. Mandy ’s Spending PlanSavings • Review Gonzales ’s Snapshot on pages 2-4 • Identify her needs, wants, values • Review the short term and long term goals set for Mandy on page 12

28. Mandy ’s Spending PlanTransportation • Mandy will pay for half of the cost of her fuel for the vehicle she shares with Connie. • She needs a vehicle to get to and from work • Refer to page 7 to see which vehicle has been chosen for Mandy

29. Mandy ’s Spending PlanOthers • Choose which “others” items Mandy would like • Personal items • Entertainment • Music • Cheerleading • Miscellaneous • Create Your Own • Draw an item and list the cost in the space provided

30. Mandy ’s Spending Plan Summary • Gross income • Expenses • Calculate the difference • If the difference is a negative number, go back and adjust some of Mandy ’s expenses.

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

32. Reflection Questions • Once the difference equals zero…. • Answer questions 18-22 throughout the simulation • Answer questions 23-27 on page 18