Money Minded Learning

Budgeting can sound like quite a chore...but it doesn't have to be. Just follow these four simple steps and budgeting will be a breeze

1. Determine your net income: Your net income is the amount of money you have to spend after taxes and deductions have been taken out of your paycheck.  To calculate your net income, take your salary or earned income, also called your gross income, and deduct federal taxes, state taxes, payroll taxes, 401k contributions, and any other benefit payments that come out of your paycheck.  The difference between your earned income and your deductions is your net income. 

In the big debate over whether a college education makes a difference, the answer is a big YES!  According to the 2011 census findings by the Bureau of Labor Statistics, the unemployment rate for Ameirican's with continued education is far less than for those without. 

• Less than high school diploma - 14.1% unemployment
• High School Diploma - 9.4% unemployment
• Some College, No Degree - 8.7% unemployment
• Associate Degree - 6.8% unemployment
• Bachelor's Degree - 4.9% unemployment
• Master's Degree - 3.6% unemployment
• Professional Degree - 2.4% unemployment
• Doctorate Degree -  2.5% unemployment

Next time you are thinking to yourself "is this worth it?", remember...the answer is YES!

In today’s fast paced world, most of us don’t take time to take cash out of the ATM, and writing a check seems like an ancient practice.  Instead, we take one of the plastic cards out of our wallets and give it a swipe often without even thinking about it.  Being an adult with purchasing experience, we know which card is a debit card and which is a credit card.  Unfortunately, our teens only see us paying for things with plastic and don’t realize that these two types of cards work very differently. So how do you explain the difference between a debit and credit card to your teen?  Here are a few key points. 

The key to budgeting is simple...  Spend less than you make

Be careful of department store credit cards.  Although the initial rewards may seem tempting, the potential costs often out weigh the benefit due to high interest rates. 

Rather than using your debit card for fun purchases, give yourself a weekly cash budget.  For instance, if you give yourself a budget of $100 per week for eating out, entertainment and shopping, take $100 out of the ATM at beginning of each week.  Each time you go to make a purchase, you will need to check to see how much cash you have left.  When you run out of cash, you have to wait for the following week to make a fun purchase!