Budgeting
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Introduction
In this activity students learn that budgeting is an important financial planning tool. They learn the steps involved in developing a budget and practise by developing their own budget, and/or a budget for a hypothetical scenario.
In relation to the taxation system, this learning provides a foundation for students to understand how taxpayers’ money in spent in the annual federal Budget.
Achievement standard
By the end of Year 7, students describe the interdependence of consumers and producers in the market. They explain the importance of short- and long-term planning to individual and business success and identify different strategies that may be used. They describe the characteristics of successful businesses and explain how entrepreneurial capabilities contribute to this success. Students identify the reasons individuals choose to work and describe the various sources of income that exist.
When researching, students develop questions and gather data and information from different sources to investigate an economic or business issue. They interpret data to identify trends. They propose alternative responses to an issue and assess the costs and benefits of each alternative. They apply economics and business knowledge, skills and concepts to familiar problems. Students develop and present conclusions using appropriate texts, terms and concepts. They identify the effects of their decisions and the possible effects of alternative actions.
Content descriptions
Economics and Business Knowledge and Understanding
Why and how individuals and businesses plan to achieve short-term and long-term personal, organisational and financial objectives (ACHEK018).
Economics and Business Skills
Apply economics and business knowledge, skills and concepts in familiar and new situations (ACHES025).
Student learning resources
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Become a spending detective
Developing a budget
Creating a budget
Interactive budget
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Suggested activity sequence
This sequence is intended as a framework to be modified and adapted by teachers to suit the needs of a class group. If you assign this activity to a class, your students will be assigned all student resources on their 'My learning' page. You can also hand-pick the resources students are assigned by selecting individual resources when you add a work item to a class in 'My classes'.
- As a class read the case study.
- Pairs of students complete the case study questions.
- Invite the class to discuss and decide on definitions for the following terms:
- required expenses
- discretionary expenses
- paying yourself first
- budget shortfall
- budget surplus
- balanced budget
- Write these definitions on the board, and if desired, ask students to write them in their books.
- Think-pair-share: What are the consequences of poor financial management, including impact on wellbeing of the individual and families.
- Students write a short summary of the consequences of poor financial management.
- Ask students if they have developed a budget before and for what purpose.
- As a class, read through the how-to-sheet, inviting clarifying questions as required.
- Students complete the worksheet (note: students may choose either or both options to practise their budgeting skills). Students will need to access the Interactive budget templates to complete the activity.
- Discuss why budgeting might be important for other economic participants, such as businesses and governments.