Creating A Budget - Answer Sheet

DIRECTIONS: Use this sheet to record your income allocation for the spending categories listed on the Creating A Budget (PDF) sheet in the assignment. You will complete the exercise three times, each time using a different income level (point total). INCOME LEVEL 1: 30 Points (Will have 25 points remaining after Income Taxes.) INCOME LEVEL 2: 24 Points (Will have 20 points remaining after Income Taxes.) INCOME LEVEL 3: 20 Points (Will have 17 points remaining after Income Taxes.) After recording your income allocations ANSWER the questions at the end of the assignment. INCOME LEVEL 1: 30 Points (Will have 25 points remaining after Income Taxes.) NOTE: Allocated point total must be 30. INCOME LEVEL 2: 24 Points (Will have 20 points remaining after Income Taxes.) NOTE: Allocated point total must be 24. DON’T FORGET to complete the exercise one more time using a different Income Level 3 on next page. INCOME LEVEL 3: 20 Points (Will have 17 points remaining after Income Taxes.) NOTE: Allocated point total must be 20. DON’T FORGET to ANSWER the questions below. QUESTIONS 1) What were the most difficult choices you had to make when allocating your points? Some of the more difficult choices were determining the amount to spend on things like entertainment, food, and clothes. These type of things can be very expensive or rather cheap and it was hard to choose the cheap side. 2) Which categories did you value the most? How did that affect your spending in that category? I valued housing and health insurance the most. It affected me because I would have to limit my spending a lot on the other categories. 3) When you spent more in one category, what did you give up in another category? Provide examples from your budget. For instance, I would spend at least four points on health insurance and dental insurance. This was a lot to spend on one category so I had to limit my entertainment to one or two points only. 4) How did you reallocate your spending when you had less income (points)? What sacrifices were the most difficult to make? I would mainly sacrifice clothing and entertainment because you can live off the cheaper side of the categories. This was difficult to make because I am so used to nice clothing and good entertainment.