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© 04/13/23 National Financial Education Centerat Debt Reduction Services
www.NationalFinancialEducationCenter.org
Welcome To
Your Your Roadmap to Roadmap to Financial Financial StabilityStability
© 04/13/23 National Financial Education Centerat Debt Reduction Services
www.NationalFinancialEducationCenter.org
Why We’re the Experts
Nationwide, non-profitNationwide, non-profit
© 04/13/23 National Financial Education Centerat Debt Reduction Services
www.NationalFinancialEducationCenter.org
Nationwide, non-profitNationwide, non-profit
Headquartered in Boise,Idaho since 1996Headquartered in Boise,Idaho since 1996
Why We’re the Experts
© 04/13/23 National Financial Education Centerat Debt Reduction Services
www.NationalFinancialEducationCenter.org
Nationwide, non-profitNationwide, non-profit
Headquartered in Boise,Idaho since 1996Headquartered in Boise,Idaho since 1996
Financial educatorsFinancial educators
Why We’re the Experts
© 04/13/23 National Financial Education Centerat Debt Reduction Services
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Outline of Session
Budgeting FundamentalsBudgeting Fundamentals
Budgeting MythsBudgeting Myths
Expense TrackingExpense Tracking
Financial HabitsFinancial Habits
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Income
• Gross vs. Net• Deductions• Net Income Ranges
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Income
• Gross vs. Net• Deductions• Net Income Ranges• Who Uses Gross?
Who Uses Net?
© 04/13/23 National Financial Education Centerat Debt Reduction Services
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Income
• Gross vs. Net• Deductions• Net Income Ranges• Who Uses Gross?
Who Uses Net?–Government–Lenders–We do
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Needs versus Wants
• Justify overspending on so-called “needs”
© 04/13/23 National Financial Education Centerat Debt Reduction Services
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Needs versus Wants
• Justify overspending on so-called “needs”
• 3 Needs:–Shelter & Security–Food & Water–Protective Clothing
© 04/13/23 National Financial Education Centerat Debt Reduction Services
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Needs versus Wants
• Justify overspending on so-called “needs”
• 3 Needs:–Shelter & Security–Food & Water–Protective Clothing
• Healthcare & Children’s Needs
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Types of ExpensesTypes of Expenses
• FixedFixed
• VariableVariable
• PeriodicPeriodic
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Types of ExpensesTypes of Expenses
Same every monthSame every month• FixedFixed
• VariableVariable
• PeriodicPeriodic
© 04/13/23 National Financial Education Centerat Debt Reduction Services
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Types of ExpensesTypes of Expenses
Change from month Change from month to monthto month
Same every monthSame every month• FixedFixed
• VariableVariable
• PeriodicPeriodic
© 04/13/23 National Financial Education Centerat Debt Reduction Services
www.NationalFinancialEducationCenter.org
Types of ExpensesTypes of Expenses
Change from month Change from month to monthto month
Same every monthSame every month
Occur Occur irregularlyirregularly
• FixedFixed
• VariableVariable
• PeriodicPeriodic
© 04/13/23 National Financial Education Centerat Debt Reduction Services
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Balance Checkbook
• Keep Register Keep Register CurrentCurrent
• Debit Cards!Debit Cards!
• Compare to Compare to StatementsStatements
• Get Above $0!!!Get Above $0!!!
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Basics of a Budget
• What you EXPECT to earn.What you EXPECT to earn.
• What you EXPECT to What you EXPECT to spend.spend.
© 04/13/23 National Financial Education Centerat Debt Reduction Services
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Basics of a Budget
• What you EXPECT to earn.What you EXPECT to earn.
• What you EXPECT to What you EXPECT to spend.spend.
• But is that all?!But is that all?!
© 04/13/23 National Financial Education Centerat Debt Reduction Services
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1. Write goals2. Track expenses3. Prioritize expenses4. Estimate monthly net
income5. Add up monthly
expenses6. Income must be greater
than expenses
Steps To Making A Budget
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Financial Myths and Realities
Why some people DON’T Budget
MYTHMYTH REALITYREALITY
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Financial Myths and Realities
I just NEED MORE MONEY!
MYTHMYTH REALITYREALITY
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Financial Myths and Realities
I just NEED MORE MONEY!
It’s NOT how much you earn. It’s how much you keep!
MYTHMYTH REALITYREALITY
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Financial Myths and Realities
Too RESTRICTIVE!
MYTHMYTH REALITYREALITY
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Greater CONTROL & FREEDOM
Financial Myths and Realities
Too RESTRICTIVE!
MYTHMYTH REALITYREALITY
© 04/13/23 National Financial Education Centerat Debt Reduction Services
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Financial Myths and Realities
Balancing Balancing checkbook is checkbook is good enoughgood enough
MYTHMYTH REALITYREALITY
© 04/13/23 National Financial Education Centerat Debt Reduction Services
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Financial Myths and Realities
Balancing checkbook is good enough
Budgets plan for Budgets plan for FUTURE, not pastFUTURE, not past
MYTHMYTH REALITYREALITY
© 04/13/23 National Financial Education Centerat Debt Reduction Services
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Financial Myths and Realities
No time!No time!
MYTHMYTH REALITYREALITY
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Financial Myths and Realities
No time!No time! Ounce of Ounce of PREVENTION is PREVENTION is worth a POUND of worth a POUND of curecure
MYTHMYTH REALITYREALITY
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Financial Myths and Realities
I didn’t cause I didn’t cause these problems.these problems.
MYTHMYTH REALITYREALITY
© 04/13/23 National Financial Education Centerat Debt Reduction Services
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Financial Myths and Realities
I didn’t cause I didn’t cause these problems.these problems.
Nobody wants you Nobody wants you to succeed like to succeed like you!you!
MYTHMYTH REALITYREALITY
© 04/13/23 National Financial Education Centerat Debt Reduction Services
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•Be honest with yourself!•Write 3 motivating goals.•Be specific!
Steps To Making A Budget
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• Estimate monthly net income1. Salary, wages2. Assistance (social security, state
help)
Steps To Making A Budget
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• Prioritize Your Expenses
EXPENSES PriorityBUDGET
(Projected)ACTUAL (Spent)
EMERGENCY SAVINGS
HOUSING
UTILITIES
Steps To Making A Budget
© 04/13/23 National Financial Education Centerat Debt Reduction Services
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• Prioritize Your Expenses• Estimate how much you will spend during
the month.1. Savings2. Housing3. Utilities
EXPENSES PriorityBUDGET
(Projected)ACTUAL (Spent)
EMERGENCY SAVINGS
HOUSING
UTILITIES
Steps To Making A Budget
© 04/13/23 National Financial Education Centerat Debt Reduction Services
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Compare Income With Your Expenses
•See Budget Planner chart for suggested spending guides. NOT set in stone.
Monthly Income vs. Expenses
$-
$500
$1,000
$1,500
$2,000
$2,500
Net Income Expenses
Positive Net Income Negative Net IncomeMonthly Income vs. Expenses
$-
$500
$1,000
$1,500
$2,000
$2,500
Net Income Expenses
Steps To Making A Budget
© 04/13/23 National Financial Education Centerat Debt Reduction Services
www.NationalFinancialEducationCenter.org
Consider your“Budget Busters”
© 04/13/23 National Financial Education Centerat Debt Reduction Services
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$6.50/weekday=$1,700/Yr
Consider your“Budget Busters”
• Fast Food
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$30/week=$1,560/Yr
Consider your“Budget Busters”
• Fast Food• Entertainment
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$4.50/weekday=$1,200/Yr
Consider your“Budget Busters”
• Fast Food• Entertainment• Latté/Gourmet Coffee
© 04/13/23 National Financial Education Centerat Debt Reduction Services
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Consider your“Budget Busters”
• Fast Food• Entertainment• Latté/Gourmet Coffee• Tobacco
$4.50/day=$1,650/Yr
© 04/13/23 National Financial Education Centerat Debt Reduction Services
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Consider your“Budget Busters”
• Fast Food• Entertainment• Latté/Gourmet Coffee• Tobacco• Cable/Satellite TV
$83.50/month=$1,000/Yr
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$27/week=$1,400/Yr
Consider your“Budget Busters”
• Fast Food• Entertainment• Latté/Gourmet Coffee• Tobacco• Cable/Satellite TV• Housekeeper
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$75/month=$900/Yr
Consider your“Budget Busters”
• Fast Food• Entertainment• Latté/Gourmet Coffee• Tobacco• Cable/Satellite TV• Housekeeper• Cell Phone
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$10/week=$520/Yr
Consider your“Budget Busters”
• Fast Food• Entertainment• Latté/Gourmet Coffee• Tobacco• Cable/Satellite TV• Housekeeper• Cell Phone• Lottery
© 04/13/23 National Financial Education Centerat Debt Reduction Services
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Consider your“Budget Busters”
• Fast Food• Entertainment• Latté/Gourmet Coffee• Tobacco• Cable/Satellite TV• Housekeeper• Cell Phone
Set goals on how to minimize your budget Set goals on how to minimize your budget bustersbusters
© 04/13/23 National Financial Education Centerat Debt Reduction Services
www.NationalFinancialEducationCenter.org
Consider your“Budget Busters”
• Fast Food• Entertainment• Latté/Gourmet Coffee• Tobacco• Cable/Satellite TV• Housekeeper• Cell Phone
Set goals on how to minimize your budget Set goals on how to minimize your budget bustersbusters
© 04/13/23 National Financial Education Centerat Debt Reduction Services
www.NationalFinancialEducationCenter.org
1. Keep good records – keep receipts
Tracking Your Expenses
© 04/13/23 National Financial Education Centerat Debt Reduction Services
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1. Keep good records – keep receipts2. Wrap debit card receipts around card
Tracking Your Expenses
© 04/13/23 National Financial Education Centerat Debt Reduction Services
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1. Keep good records – keep receipts2. Wrap debit card receipts around card3. Set up a filing system: Envelopes,
cabinets, scanning, files, etc…
Tracking Your Expenses
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Tracking Your Expenses
At month’s end…1. Add up the categorized receipts for
each category
EXPENSES BUDGET ACTUAL
ENTERTAINMENT $100MONTHLY DEBT PAYMENTS $175
EXPENSES TOTAL (enter below)
$60
$200$260$275
© 04/13/23 National Financial Education Centerat Debt Reduction Services
www.NationalFinancialEducationCenter.org
Tracking Your Expenses
At month’s end…1. Add up the categorized receipts for
each category2. Compare with the projected budget
EXPENSES BUDGET ACTUAL
ENTERTAINMENT $100MONTHLY DEBT PAYMENTS $175
EXPENSES TOTAL (enter below)
$60
$200$260$275
© 04/13/23 National Financial Education Centerat Debt Reduction Services
www.NationalFinancialEducationCenter.org
Tracking Your Expenses
At month’s end…1. Add up the categorized receipts for
each category2. Compare with the projected budget3. Adjust budget AND/OR behaviors
© 04/13/23 National Financial Education Centerat Debt Reduction Services
www.NationalFinancialEducationCenter.org
Self-Affirmation
Please Repeat After Me:Please Repeat After Me:
© 04/13/23 National Financial Education Centerat Debt Reduction Services
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Self-Affirmation
I Live by a Budget!I Live by a Budget!
Please Repeat After Me:Please Repeat After Me:
© 04/13/23 National Financial Education Centerat Debt Reduction Services
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Self-Affirmation
I Live by a I Live by a Budget!Budget!
Please Repeat After Me:Please Repeat After Me:
© 04/13/23 National Financial Education Centerat Debt Reduction Services
www.NationalFinancialEducationCenter.org
Self-Affirmation
Please Repeat After Me:Please Repeat After Me:
I Live by a I Live by a Budget!Budget!
© 04/13/23 National Financial Education Centerat Debt Reduction Services
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More Financial Habits
SAVINGS PLAN– Not just an Account– Pay yourself first (10-15%
of take home)– Get to $1,000– Goal of 3-6 months of
survival expenses– Consistency more
important than amount
© 04/13/23 National Financial Education Centerat Debt Reduction Services
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For Better or for Worse•Write down MUTUAL Financial Goals•15 min Weekly Review Together
Family Financial Habits
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Family Financial Habits
Children• Let them see you budgeting
• Let them help with priorities
• Connect behavior to consequences
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Consider Your Other Habits…
More Financial Habits
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Consider Your Other Habits…
•Weekly menu?
More Financial Habits
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Consider Your Other Habits…
•Weekly menu?
•Shop with list & calculator?
More Financial Habits
•Carrots
•Juice•Soap
© 04/13/23 National Financial Education Centerat Debt Reduction Services
www.NationalFinancialEducationCenter.org
Consider Your Other Habits…
•Weekly menu?
•Shop with list & calculator?
•Shop regularly?
More Financial Habits
© 04/13/23 National Financial Education Centerat Debt Reduction Services
www.NationalFinancialEducationCenter.org
Consider Your Other Habits…
•Weekly menu?
•Shop with list & calculator?
•Shop regularly?
•Cash or plastic?
More Financial Habits
© 04/13/23 National Financial Education Centerat Debt Reduction Services
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Thank You!Thank You!