Life Of….. Carlos Chavez Get ready to Take Charge of Your Finances

Family Economics & Financial Education

Get ready to Take Charge of Your Finances

Life Of…..

Carlos Chavez

“A Teenager’s Spending Plan”

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Snapshot – Carlos Chavez

• Sneak peak into the life of Carlos and his family

– Carlos

– Nana (Martha)

– Jorge

– María

– Adriana

– Marco

© Family Economics & Financial Education –Updated April 2010 – Get Ready to Take Charge of Your Finances – Life Of...Carlos – Slide 2

Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at The University of Arizona

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Snapshot

Carlos' Income and Expenses

• Carlos' Income

– Sunshine Inn

• $8.50/hour

• 10 hours a week

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Snapshot

Carlos'

Income and Expenses

• 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

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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



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Snapshot

Chavez

Family Expenses

• 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



Housing

• Monthly Payment

– Housing payment

– Insurance

– Property taxes

– Repairs

– Maintenance

• Utilities

– Heat

– Electricity

– Water

– Sewer

– Garbage

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Housing Others

• Digital Cable

• Add Ons

• Telephone

• Cellular Phone

• Internet



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Transportation

• 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



Others

• Running Supplies

• Downhill Ski Supplies

• Electronics

• Video Games

• Entertainment

• Cellular Phone

• Create Your Own



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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

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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



Snapshot Reflection

• Review Carlos' Snapshot on pages 2-4

• Answer questions 1-5 on page 10

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Carlos' Paycheck

Personal

Information

State the employee’s name, address, and social security number.



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Carlos' Paycheck

Pay Period

The length of time which an employee’s wages are calculated.



Carlos' Paycheck

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Gross Pay

The total amount of money earned during the pay period before payroll withholdings.



Carlos'

Paycheck

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The amount of money subtracted from the gross pay for taxes.

Payroll

Withholdings



Carlos' Paycheck

The amount required by law for employer to withhold from earned wages to pay taxes.

Withholding

Tax



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Carlos' Paycheck

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Federal Insurance

Contribution Act – includes Social

Security and

Medicare

FICA



Carlos' Paycheck

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Net Pay

The amount of money remaining after all payroll withholdings have been removed from gross pay.



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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.

Year-to-Date



Setting Education and Financial

Goals

SMART Goal

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S pecific

State exactly what is to be done.

M easurable

Include how the goal can be measured.

A ttainable

Determine steps to reach the goal.

R ealistic

Do not set the goal for something unrealistic.

T ime

B ound

State when the goal will be met.

•Short Term – less than one year

•Long Term – more than one year



Chavez’s Major Expenditures

Housing

• 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

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Transportation

• 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

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Major 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



Carlos' Spending Plan

Payroll Withholdings

• Review Carlos' paycheck on page 11

– State Withholding Tax

– Federal Withholding Tax

– FICA

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Savings

• 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

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Others

• 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

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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.

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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!



Reflection Questions

• Once the difference equals zero….

– Answer questions 17-22 on pages 15 and 16

– Answer questions 23-27 on page 18

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Life Of….. Carlos Chavez Get ready to Take Charge of Your Finances

Life Of…..

Carlos Chavez

Snapshot – Carlos Chavez

• Sneak peak into the life of Carlos and his family

Snapshot

• Carlos' Income

Snapshot

Carlos'

Spending Plan

Snapshot

Chavez

Housing

Housing Others

Transportation

Others

Goal:

Quick Review

Snapshot Reflection

Carlos' Paycheck

Paycheck

Carlos' Paycheck

Chavez’s Major Expenditures

Chavez’s Major Expenditures

Chavez’s Major Expenditures

Carlos' Spending Plan

Carlos' Spending Plan

Carlos' Spending Plan

• Extracurricular Activities

• School Lunches

• Choose which “others” items Carlos would like

Carlos' Spending Plan Summary

Negative or Positive

Difference?

Reflection Questions

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Support

Life Of….. Carlos Chavez Get ready to Take Charge of Your Finances

Life Of…..

Carlos Chavez

Snapshot – Carlos Chavez

• Sneak peak into the life of Carlos and his family

Snapshot

• Carlos' Income

Snapshot

Carlos'

Spending Plan

Snapshot

Chavez

Housing

Housing Others

Transportation

Others

Goal:

Quick Review

Snapshot Reflection

Carlos' Paycheck

Paycheck

Carlos' Paycheck

Chavez’s Major Expenditures

Chavez’s Major Expenditures

Chavez’s Major Expenditures

Carlos' Spending Plan

Carlos' Spending Plan

Carlos' Spending Plan

• Extracurricular Activities

• School Lunches

• Choose which “others” items Carlos would like

Carlos' Spending Plan Summary

Negative or Positive

Difference?

Reflection Questions

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