Creating a Zero-Based Budget for Life After High School
School
Hanford High School**We aren't endorsed by this school
Course
APW 697
Subject
Economics
Date
Dec 10, 2024
Pages
9
Uploaded by PrivateElephant4594
PAGE 1 OF 9Budgeting for Life After High SchoolCHAPTER 2, LESSON 6NAME(S)DATEDIRECTIONSUse the budget forms in this activity to create a zero-based budget for each of these three scenarios.Scenario OneLisa is a third-year college student living alone in an apartment. She works 20 hours a week at a local bank, making $10 per hour. Lisa has a savings account that she built up during high school and by working full-time summer jobs. During the school year, she withdraws $350 per month to help cover her living expenses. Lisa’s college tuition and books are covered by her scholarships. Her parents help by providing an additional $500 a month and also provide her health insurance. Lisa’s fixed monthly expenses are:• Rent:$600• Insurance (renter’s and identity theft):$25• Car insurance:$110• Utilities:$60• Cell phone:$60• Streaming services:$40* Lisa’s budget should include giving and saving. It could also include spending categories like the following: food, gas, entertainment and personal.1. Gross monthly income from part-time job:2. Net monthly income from part-time job:Deduct 20% of the income for payroll taxes (gross income x .80 = net income)FOUNDATIONS IN PERSONAL FINANCE
PAGE 2 OF 9Lisa’s Budgeting FormINCOMEPlannedTotalEXPENSESPlannedGivingTotalSavingTotalEXPENSESPlannedSpendingTotalGiving Total+Saving Total+Spending Total=TOTAL EXPENSESTOTAL INCOME–TOTAL EXPENSES=LEFT TO BUDGETFOUNDATIONS IN PERSONAL FINANCE
PAGE 3 OF 9Budgeting for Life After High SchoolCHAPTER 2, LESSON 6DIRECTIONSAnswer the following questions and be ready to discuss your answers with the class.3. What transportation alternatives might Lisa consider to allow more room in her budget? 4. What changes, if any, could Lisa make to her income? 5. What alternatives might Lisa consider to cut her streaming services expense? 6. What other changes could Lisa make to positively affect her budget? FOUNDATIONS IN PERSONAL FINANCE
PAGE 4 OF 9Budgeting for Life After High SchoolCHAPTER 2, LESSON 6Scenario TwoJames has worked full time as an entry-level web designer since earning his certification. He earns $47,000 a year and rents an apartment by himself. He has a credit card, which he used to purchase furniture, with a balance of $3,235. Unfortunately, to celebrate his first job, James also financed a new car—which cost $28,000. His payments are $554 for a term of five years. James has health insurance and disability insurance through his employer, which cost him $185 a month. He also contributes 4% of his gross income to his 401(k). James’ fixed monthly expenses include:• Rent:$1,200• Insurance (renter’s and ID theft):$25 • Insurance (health and disability):$185 • Retirement/401(k):$157 • Car insurance:$120 • Utilities:$100 • Cell phone:$85 • Satellite TV:$80 • Credit card (minimum payment):$150* Note: At 17% interest, it will take 26 months to pay off this credit card debt.• Car payment:$554* James’ budget should include giving and saving. It could also include spending categories like the following: food, gas, entertainment and personal.7. Net annual income: 8. Net monthly income:Deduct 20% of the income for payroll taxes (gross income x .80 = net income)FOUNDATIONS IN PERSONAL FINANCE
PAGE 5 OF 9James’ Budgeting Form #1INCOMEPlannedTotalEXPENSESPlannedGivingTotalSavingTotalEXPENSESPlannedSpendingTotalGiving Total+Saving Total+Spending Total=TOTAL EXPENSESTOTAL INCOME–TOTAL EXPENSES=LEFT TO BUDGETFOUNDATIONS IN PERSONAL FINANCE
Budgeting for Life After High SchoolCHAPTER 2, LESSON 6