FCS 3400
Budget Assignment

Part 1

Step 1. You need to keep track of all spending for four weeks-one month. Please keep a daily record. Carry it with you and write down every expenditure. You should include the amount spent, the date, where you spent it and for what. Your checkbook register is not sufficient record keeping for this assignment, because you need to account for checks, cash, and credit card purchases. (If your expenses seem "unrealistic" for a college student, please include a short explanation for them (i.e. you have no food or rent expenses because you live at home with your parents).)

Step 2. Divide your expenditures into categories that make sense to you, such as: food, clothing, rent, utilities, tuition/fees/books, etc. Total all of your expenditures for each area. Here is an example of an income/budget form with common income and expense categories if you would like to use it.  It is only a guide and you may use it or create your own.

Step 3. Identify at least two financial goals, one of which should be a long-term goal. Using what you have learned, determine how much you need to save each month to meet your goals.

Step 4. Determine your total monthly income from all sources.

Step 5. Using the amounts you have determined from your tracking exercise and the amounts you need to save each month for your goals, allot your monthly income to each category (i.e., $200.00 rent, $100.00 food, $50.00 savings for new car, $25.00 emergency savings, etc.). It may be necessary to adjust amounts to meet income! REMEMBER: Spending+Savings = Income. Also, you do not have to use the exact amount you spent during the tracking exercise, especially if you have determined that it is too high. The tracking exercise is intended to help you determine realistic amounts and to help you find the "leaky holes" in your spending plan.

 Step 6. Now that you have identified your categories and the amount to put into them each month, select a method to track your expenses in the coming months so that you stay within the guidelines of your plan. The simplest method is to write the category name at the top of a 3x5 card or page in a notebook. Make 6 columns on each card or page and label them "date," "amount," "balance," "date," amount," "balance." (Put a double line between the two sets of columns.) As you receive income, add the determined amount onto the card. As you spend the money, subtract the amount from the card. A computer spreadsheet or program would also work

 Step 7. Implement your plan! (You will report on the implementation in Part 2 of the Budget Assignment.)

What to turn in:    You should turn in a short paper (typed, double-spaced).  The paper should have the following labeled sections.  The number of points for each section is listed next to the section.

Expenditures (5)

 Prepare a report of your expenditures for the month. This may be a list or in a chart.

Categories (3)

 List the categories you chose and the totals.

Goals (4)

List your two goals and how much you will need to save each month to accomplish the goals.  If some goals are long term, mention that and when you will begin saving to meet them.

Income (3)

 Show your sources of income and the amounts from each.

Plan (5)

Prepare a new budget using your categories and planned monthly amount for each category.  Show all spending and saving.  This should balance with the income!

Tracking method (4)

Explain how you will track your expenses. You may use one of the methods suggested in step 6 above, or another method that works for you.   

Analysis (6)

 Answer and discuss these three questions:

              1. What did you learn from your tracking exercise?

              2. What surprised you about your spending?

              3. What changes have you made or will you make as a result of your tracking?