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Sources of Income

Unit 20: Managing Personal Finance
by

Lani Douangchak

on 25 February 2013

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Transcript of Sources of Income

Sources of Income & Types of Expenditure Unit 20: Managing Personal Finance Personal Budgets 1. We defined the term 'Personal Budget'.
2. The purpose for a personal budget.
3. Areas required to plan a budget.
4. Created your own budgeting plan

All of the above key areas will prepare you for one of the elements of the assignment tasks.

We will look at a few more examples of these. Activity Three Make a list of the Advantages and Disadvantages of making a written budget. At the moment your income may be
limited but as your life progresses
you could well have additional sources. The way people spend their money varies
a lot from one person to another. It may
depend on your current living arrangements. Aims and Objectives Aims To be able to understand the different sources of income and where these might come from,
and to understand the types of expenditures, which can be essential or non essential to
everyday living. These will provide the basis for your budgeting plan. Objectives 1. To be able to define regular and irregular sources of Income,
2. To be able to distinguish between regular and irregular sources of Income and provide real life example.
3. To be able to define essential and non-essential expenditure.
4. To be able to distinguish between essential and non-essential expenditure and provide examples.
5. To be able to apply sources of income and expenditure to a real life planning of a budget. Desert Island Activity Sources of Income From the previous lesson, we all understood what 'Income' was on a budget.

Therefore, what does the term 'Income' mean?... As we all understand, Income means the amount of money coming in.

However these can be divided into regular and irregular sources of income.

Can you define this difference? Activity In pairs,

1. Match the sources of income with the correct terms and then,

2. Distinguish between whether they are regular or irregular sources of income. You have 10 minutes
to do this activity http://www.online-stopwatch.com/countdown-clock/full-screen/ Activity Now you have a list of regular and irregular sources of income.

Research the following current allowances for:
Minimum wage
state benefit amounts e.g. job seekers allowance etc
student loans/grants http://www.online-stopwatch.com/countdown-clock/full-screen/ You have 5 minutes
to do this activity Objective Check You will now be able...

To be able to distinguish between regular and irregular sources of Income and provide real life example. Types of Expenditure Can you all remember what is mean by
essential and non essential expenditure? We understand that essential expenditure means this is unavoidable expenditure necessary for a day-to-day living. However, non essential expenditure means items not necessarily required for day-to-day living but is not as frequently required. You have 10 minutes
to do this activity http://www.online-stopwatch.com/countdown-clock/full-screen/ Activity In pairs,

1. Match the types of expenditure with the correct terms and then,

2. Distinguish between whether they are regular or irregular types of expenditure. When you are planning a budget some entries are fairly predictable since they happen on a regular basis. Other items of income and expenditure are irregular, and in some cases not predictable at all. When preparing a budget, it is difficult to allow for irregular income and expenditure. Therefore, you could put all irregular income into a saving account with your regular savings.

This can be used for irregular expenditure. Can also be known as regular and irregular expenditure. http://goanimate.com/videos/0SGV2IhHieSw?utm_source=linkshare Your survival bag contains:
Bag
Torch
Rope
Hooks
First Aid Bag
Flares
Whistle
Blunt Knife Water
Beans
Matches
Mirror
Sleeping bag What is the bare minimum to survive? consider warmth, shelter, food and drink.

Why were the other things not taken? Discussion What do you think is essential to everyday life at home?...

Are these things free?

Is money an essential item in our lives? Discussion Which 5 item would you choose and why? This activity should have made you think about the essential and non essential needs (expenditure) within daily life.

You can see how money means different things to everyone as well as their needs and wants. You are now on the Island http://goanimate.com/videos/0n4pRAcD5Iiw?utm_source=linkshare From the list below, choose 3 items to bargain fish for:•
Bar of chocolate
Bottle of rum
Pack of 10 cigarettes
Bag of gold
Barrel of salt Which 3 items have you chosen over the others and why?... Fish Hooks
Bags of sweets
Magazines
Toilet paper 1. Did you choose items you needed, or items you wanted?
2. Were you all in agreement regarding the items you chose?
3. Why are people’s priorities often different? Discussion From the range of sources of income you are now aware of.

Can you think of ways you can increase some of these sources of income. Activity Now you are aware of the different types of expenditures.

Can you research for the following real life examples of expenditures.

Mobile phone costs
Internet costs
Credit card costs
Insurance for mobiles. Activity You will have 5 minutes to to this activity http://www.online-stopwatch.com/countdown-clock/full-screen/ Objective Check You are able to...

To be able to define essential and non-essential expenditure. Regular income is an income which comes in every week or month.

Irregular income is where the amount of money received is not consistent. Key Terms Objective Check You will be able...

To be able to define regular and irregular sources of Income, Objective Check You will be able...

To be able to distinguish between essential and non-essential expenditure an provide examples. From last weeks lesson we were looking at personal budgets.

Now we are all aware of the sources of income and types of expenditure.

Let's practice more on creating budgets by working through these activities. Activity One In groups of 4 for the Party Time Planning Activity Two Individually Prepare Alex's Budget Activity Four Lets work on the worksheet; Advice for others. Please register yourself as a student on the Natwest MoneySense Website. http://moneysense.natwest.com/schools/vle/common/register The passcode is: A34HY7

Complete the activity as added to the course. Throughout this unit We will be using the Natwest Money Sense website for further activities and information. Finally You are able to... 1. To be able to define regular and irregular sources of Income.

2. To be able to distinguish between regular and irregular sources of Income and provide real life example.

3. To be able to define essential and non-essential expenditure.

4. To be able to distinguish between essential and non-essential expenditure an provide examples.

5. To be able to apply sources of income and expenditure to a real life planning of a budget. Objective Check You are able to...

To be able to apply sources of income and expenditure to a real life planning of a budget.
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