Introduction to Income vs. Expenses
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Transcript of Introduction to Income vs. Expenses
![Page 1: Introduction to Income vs. Expenses](https://reader036.fdocuments.us/reader036/viewer/2022062309/5681363b550346895d9db606/html5/thumbnails/1.jpg)
Introduction to Income vs. Expenses
7th GradeIncome vs. Expenses #1
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Pre-Test
1. What are the two keys to financial success?
2. What is the average annual income for a high school dropout?
3. For a family of four in Minneapolis, what is the average annual costs for their necessities?
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Objectives • Learn the keys to financial success• Learn how education level affects annual
income• Understand the importance of strategic
budgeting• Compare income vs. expenses
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Good Annual Income
• Education is the top determiner of your income• The average American changes careers five times• When you have a good education you• Become more marketable when changing careers• Have a better chance for promotion, which increases
your income• It is important you know income by education level
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Income by Education Level Income by Education Level
Source: US Department of Labor: Labor Statistics Report, 2012
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Strategic Budgeting
• Many people spend more money than they earn• A budget helps you live within your income• Financial problems are often a major factor in • High levels of stress• Marital and family problems • Disease and illness
• Budgeting• Income vs. Expenses
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Avg. Expenses: Necessities
Source: Economic Policy Institute: Briefing Paper 2010
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Income vs. Expenses
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Income vs. Expenses
• The average costs for necessities are• $4,700 a month or $56,400 a year for a family of four in
Minneapolis • This includes expenses for
House and car payments, medical insurance, food Heating, air conditioning, electricity, water, child care
• This does not include expenses for Cable TV, restaurants, internet, sports activities Movie tickets, cell phones, music downloads, etc.
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Income vs. Expenses
• What annual income does a family of four need in Minneapolis?– $56,400
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Metro Area: Child Care
Source: Economic Policy Institute: Briefing Paper 2010
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Child Care vs. Income
• What would be the annual cost for child care if a family has an infant and a pre-school age child?– $8,150 + $6,500 = $14,650
• If a high school graduate earns $30,000 a year, how much would they pay in taxes at a 20% rate? – $30,000 * .20 = $6,000
• What is the difference between the child care cost and high school graduate income after taxes?– $24,000 - $14,650 = $9,350
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Child Care vs. Income
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Pick a Partner
• What type of a family do you envision yourself having as an adult?
• What type of education do you plan on obtaining?
• How will your education level help you meet your financial needs?
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Classroom Discussion
• What type of a family do you envision yourself having as an adult?
• What type of education do you plan on obtaining?
• How will your education level help you meet your financial needs?
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Post-Test
1. What are the two keys to financial success?
2. What is the average annual income for a high school dropout?
3. For a family of four in Minneapolis, what are the average annual costs for their necessities?
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Review 1. The two keys to financial success
Make a good annual incomeStrategic budgeting
2. What is the average annual income for a high school dropout? $19,300
3. For a family of four in Minneapolis, what are the average annual costs for their necessities?$56,400