Embedded Files
In today's activity you will:
In today's activity you will:
- Develop a savings plan by "Paying Yourself First"
- Start investing and saving for retirement
- Calculate the total amount you're saving each month
- Calculate the monthly amount you have to budget
Materials needed:
Materials needed:
- Salary Based Budgeting Worksheet, steps 5-8
- Journal Entry Page 2
Step 5
Step 5
“Pay yourself first” by putting aside a percent of your net salary into an emergency savings account. Choose one of the percents below, and calculate how much you’ll be saving off your net salary.
“Pay yourself first” by putting aside a percent of your net salary into an emergency savings account. Choose one of the percents below, and calculate how much you’ll be saving off your net salary.
5% → this is low, but better than nothing
5% → this is low, but better than nothing
10% → this is a good first ; increase later
10% → this is a good first ; increase later
15% → terrific savings goal!
15% → terrific savings goal!
Savings = Net Wage (monthly) x % savings
Savings = Net Wage (monthly) x % savings
(Remember 5% = .05, 10% = .10, and 15% - .15)
(Remember 5% = .05, 10% = .10, and 15% - .15)
Enter the amount you'll save monthly on Step 5 of your Salary Based Budget Worksheet.
Enter the amount you'll save monthly on Step 5 of your Salary Based Budget Worksheet.
Step 6
Step 6
It’s never too young to start investing and saving for retirement . Starting early will help you build wealth through the magic of compound interest, and will establish a great retirement fund for you:
It’s never too young to start investing and saving for retirement . Starting early will help you build wealth through the magic of compound interest, and will establish a great retirement fund for you:
5% → this is low, but better than nothing
5% → this is low, but better than nothing
10% → this is a good first goal; increase later
10% → this is a good first goal; increase later
15% → terrific retirement goal!
15% → terrific retirement goal!
Retirement = Net Salary (monthly) x % retirement
Retirement = Net Salary (monthly) x % retirement
(Remember 5% = .05, 10% = .10, and 15% - .15)
(Remember 5% = .05, 10% = .10, and 15% - .15)
Enter the amount you plan to invest monthly on Step 6 of your Salary Based Budget Worksheet.
Enter the amount you plan to invest monthly on Step 6 of your Salary Based Budget Worksheet.
Step 7
Step 7
Calculate the total amount you are saving each month by adding your monthly savings and your monthly investment amounts together and enter this amount on Step 7 of your Salary Based Budget Worksheet:
Calculate the total amount you are saving each month by adding your monthly savings and your monthly investment amounts together and enter this amount on Step 7 of your Salary Based Budget Worksheet:
Total Monthly Savings = Monthly Savings Amount + Monthly Investment Amount
Total Monthly Savings = Monthly Savings Amount + Monthly Investment Amount
Step 8
Step 8
Calculate the monthly amount you have to budget by subtracting your savings amounts from your monthly net salary, and enter that amount on Step 8 of your Salary Based Budget Worksheet.
Calculate the monthly amount you have to budget by subtracting your savings amounts from your monthly net salary, and enter that amount on Step 8 of your Salary Based Budget Worksheet.
NOTE: Savings is NOT an expense; it’s the money you’re setting aside for your own future. However, it’s also money that you shouldn’t spend on other things each month, so it gets taken out BEFORE you do your monthly budget.
NOTE: Savings is NOT an expense; it’s the money you’re setting aside for your own future. However, it’s also money that you shouldn’t spend on other things each month, so it gets taken out BEFORE you do your monthly budget.
Monthly Amount to Budget = Net Salary (monthly) - Total Savings
Monthly Amount to Budget = Net Salary (monthly) - Total Savings
JOURNAL
JOURNAL
Amazing work! You've created a savings and investing plan that will become the foundation of creating a secure lifestyle for yourself and your family. Here are your journal reflection topics for this lesson:
Amazing work! You've created a savings and investing plan that will become the foundation of creating a secure lifestyle for yourself and your family. Here are your journal reflection topics for this lesson:
How much did you decide to save in savings and retirement, and why did you make these choices?
How much did you decide to save in savings and retirement, and why did you make these choices?
How much will your investment account be worth at the end of 30 years (use the Compound Interest Calculator in Step 6)?
How much will your investment account be worth at the end of 30 years (use the Compound Interest Calculator in Step 6)?
Here is the Zoom recording for this week's webinar.
Here is the Zoom recording for this week's webinar.
SEC - Saving and Investing for Students.pptxThank you to Javier Villarreal and Scott Webb from the Securities and Exchange Commission for your talk this week on Saving and Investing for Students! The slides from their presentation are above for your reference.
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