Spending & Saving

Spending

• Disposable Income
• Income left after taxes
• Buy necessities first
• Discretionary Income
• Money left to spend on extras

Buying the Necessities

• Food & Clothing - Comparison shopping
• Trade-off between quality & price
• Trade-off on where to buy products
• Brand-name vs. Store-brand
• Coupons, discount cards, & sales

To Rent or To Buy

• Must consider the advantages
• Renting = lower monthly cost, mobility, no maintenance
• Owning = build equity, tax benefits, pride of ownership

Buying a Vehicle

• New vs. Used - depreciation
• Warranty options
• Operating costs
• Gas, maintenance & repairs
• Registration & insurance

Saving

• Setting aside income for future use
• Earn interest in savings accounts
• Payment received when you lend funds
• Important to make a plan to control cash flow
• Money coming in & money going out

Tracking Your Spending

• A budget looks at spending vs. income
• Spending should not be more than earned
• Changes need to be made if this is true
• Daily Spending Diary