High school
Personal Budgeting
and Finance
Take control of your money
Objectives
● Understand the importance of personal
finance.
● Learn budgeting techniques for better
financial control.
● Discover tools and tips to save and
invest for the future.
What is personal finance?
Definition: Personal finance refers to the management of an individual's or
household’s financial activities, including income, expenses, savings,
investments, and protection.
Key Elements:
● Income: Salaries, side hustles, etc.
● Expenses: Bills, rent, groceries, etc.
● Savings: Emergency fund, retirement savings, etc.
● Investments: Stocks, bonds, real estate, etc.
● Protection: Insurance, retirement plans, etc.
Why Budgeting is Important?
Key Benefits:
● Track Spending: Prevent overspending and identify
unnecessary expenses.
● Debt Management: Help you pay off loans and credit
card debt faster.
● Achieve Financial Goals: Save for big goals like buying a
house or retirement.
● Reduce Stress: Helps you feel in control of your finances.
Budgeting Methods
50/30/20 Rule:
● 50%: Needs (rent, bills, groceries).
● 30%: Wants (entertainment, dining out).
● 20%: Savings and debt repayment.
Zero-Based Budgeting:
● Every dollar is assigned a specific purpose, leaving you with $0 at the end of the
month.
Envelope System:
● Using cash in envelopes for each category (e.g., groceries, entertainment) to limit
spending.
Creating a personal budget
Step 1: List all sources of income.
Step 2: Categorize monthly expenses (fixed
and variable).
Step 3: Set financial goals (short-term and
long-term).
Step 4: Allocate your income according to
your chosen method.
Step 5: Track your spending and adjust if
necessary.
Saving Money
Building an Emergency Fund: Aim for 3-6
months of living expenses.
Automatic Savings: Set up automatic
transfers to a savings account.
Cutting Unnecessary Expenses: Track what
you spend to find areas to cut back
(subscriptions, dining out, etc.).
Use of Savings Apps: Apps like Digit or
Qapital that help you save by rounding up
purchases.
Reducing Dept
Debt Snowball Method:
● Pay off the smallest debts first while making minimum payments on others.
● As each debt is paid off, the amount freed up goes to the next smallest
debt.
Debt Avalanche Method:
● Pay off the highest-interest debt first.
Tips:
● Avoid high-interest debt like credit card balances.
● Consider consolidating or refinancing loans for lower interest rates.
Investing for the Future
Types of Investments:
● Stocks: Owning a share in companies.
● Bonds: Lending money to companies or the government.
● Real Estate: Investing in property.
● Retirement Accounts: 401(k), IRA, Roth IRA.
Risk vs. Reward: The higher the risk, the higher the potential reward (and vice
versa).
Start Early: The earlier you start investing, the more time your money has to
grow due to compounding.
Tracking your progress
Use Apps: Mint, YNAB (You Need A Budget),
or PocketGuard to track income, expenses,
and goals.
Review Monthly: Regularly check your
spending and saving to ensure you're on
track.
Adjust When Needed: If you're overspending
in one area, adjust your budget.
Tips for Financial Success
Live Below Your Means: Don’t spend more
than you earn.
Plan for Big Expenses: Budget for things like
vacations, medical costs, or large purchases.
Stay Informed: Continue learning about
personal finance and adjusting your strategy
as needed.
Automate Savings and Payments:
Automate as much as possible to avoid
missed payments and encourage savings.
Conclusion
Recap:
● Personal finance and budgeting are
essential skills to achieving financial
stability.
● Following budgeting methods and
saving strategies will help you meet your
financial goals.
Call to Action: Start by setting up a simple
budget today!
Thanks!
Do you have any questions?
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