In order to get your personal finances under control, you need to prepare a pers
ID: 2484691 • Letter: I
Question
In order to get your personal finances under control, you need to prepare a personal budget. Assume that you have compiled the following information regarding your expected cash flows for a typical month.
Rent payment $500
Miscellaneous costs $210
Interest income 50
Savings 50
Income tax withheld 300
Eating out 150
Electricity bill 85
Telephone and Internet costs 125
Groceries 100
Student loan payments 375
Wages earned 2,500
Entertainment costs 250
Insurance 100
Transportation costs 150
Using the information above, prepare a personal budget. In preparing this budget, use the format found at http://financialplan.about.com/cs/budgeting/l/blbudget.htm. Just skip any unused line items.
Personal Budget
Typical Month
Personal Budget
Typical Month
Explanation / Answer
Solution.
Net Income Worksheet Category Montly Budget Amount Gross Income Wages, Salary, Bonuses 2500 Interest Income 50 Investment Income 50 Other Income (e.g., child support, alimony) Taxes Withheld and Paycheck Deductions Federal Income Tax 300 State and Local Income Tax Social Security and Medicare Tax Employer Health Insurance Premium Employer Retirement Plan Contribution (e.g., 401k) Other Net Income Total: (Subtract taxes and deductions from gross income) 2300 Expenses Worksheet Category Monthly Budget Amount Home Mortgage or Rent 500 HOA Fees Homeowner's or Rental Insurance Property Taxes Home Repairs/Home Maintenance Home Improvements Utilities Electricity 85 Water/Sewer Natural Gas or Oil Telephone/Data Plan Cable TV/Internet 125 Food Groceries 100 Restaurants/Fast Food 150 Coffee/Alcohol Family Obligations Child Support Alimony Daycare/Babysitting Activities/Lessons Health and Medical Health Insurance Premiums (if not deducted from paycheck above) 100 Vision Insurance Premiums (if not deducted above) Dental Insurance Premiums (if not deducted above) Unreimbursed Medical Expenses/Insurance Co-Pays Prescription & OTC Medications Fitness (e.g., Personal Trainer, Gym, Yoga) Transportation Car Loan/Lease Payments Car Insurance Gasoline Car Repairs/Maintenance Public and Other Transportation (Bus, Subway, Taxi, Ride Share) 150 Other Transportation Expenses (e.g., tolls, parking expenses) Debt Payments Credit Card Payment Student Loan Payment 375 Other Loans Other Insurance Life Insurance Premiums Education Tuition Textbooks School Supplies Entertainment/Recreation Computer Expenses Subscriptions and Dues Hobbies Vacations/Travel Other Entertainment 250 Pet Care Pet Food Grooming, Boarding, Veterinary Personal Care Toiletries/Cosmetics Household Products Clothing Other Personal Care Savings and Investments Retirement Accounts (not deducted from paycheck - e.g., IRAs) Brokerage Accounts College Fund Savings/Emergency Savings Miscellaneous Gifts/Donation Other Miscellaneous 210 Total Expenses: 2045 Monthly Surplus or Shortage Total Monthly Income: 2300 Total MonthlyExpenses: 2045 Total Monthly Surplus or Shortage (Income minus Expenses): 255Related Questions
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