Financial Planning NEFE Unit 2 - Lesson 6 - Income, Taxes and Expenses :: Curriculum

Accounting Model

Units:

Financial Planning NEFE Unit 2 - Lesson 6 - Income, Taxes and Expenses

Part of Unit: Personal Finance

Lesson Plan Overview / Details

This lesson is all about income, taxes and expenses. Students will learn about the different types of taxes which will be taken out of their paychecks, and will learn the difference between "Gross Income" and "Net Income." Also covered is the importance of saving money and how this will affect their llives in the future. The first activity will include the information students got from the past days assignment pertaining to their parents expenses. The last activity will include information necessary for students to complete their savings goal.

To the Instructor

The National Endowment for Financial Education (NEFE) has a student guide workbook as well as an Instructors Manual (IM) that you need to download which is free of charge. Go to http://hsfpp.nefe.org/ for this free program, then click on Instructor at the top of the page and register to use this Financial Planning Program for high schools. You can also contact them and request free workbooks for your students to use and take home as well. You will have access to the IM which is online. There are chapter assessments at your fingertips for each unit. The NEFE website has videos, PowerPoint presentations, copy of the entire IM and student workbooks, and much more. This unit will take approximately 4 class periods to complete depending on class schedules and added activities you might use for student retention.

Lesson Times

Time: 50 Minutes

Standards

California Career and Technical Education Standards

California Academic Content Standards (Reinforced)

ELA.9-10.R.SFIM.2.1 Analyze the structure and format of functional workplace documents, including th...32

Student Objectives / Goals

Students will identify sources of income and types of expenses
Students will know the importance of saving (paying yourself first)
Students will know why employers take money out of their paycheck
Students will know how to explain the difference between gross and net income
Students will take this information and begin to create a budget

Activities in this Lesson

Sponge Activity - Hooks / Set

Put on the board before students arrive. Then have students discuss their answers.

"Why is our paycheck amounts smaller than what we think we should get? What is Social Security anyway? Discuss with the person next to you how much money do you think would be taken out of a $600 weekly wage? Then discuss what you think Social Security taxes are used for."
Your families budget - Check Understanding
This is a review of the last class session.

"You were asked to bring in a list of your families monthly expenses. Let's go over what you found out." Give students time to discuss some of the expenses each family has that are the same, and some of the difference. If time allows, have students create a pie chart which will reinforce their learning the previous day.

Then, open the rest of the class period with a lecture on withholdings (page 18) and why it is important to know what is taken out of your paycheck and so that when you aquire bills, you will know how much actual money you will have to pay them.
Why is So Much Money Taken Out of My Pay - Guided Practice
For the students:

"Purpose: After reading page 18 in your student guide, you will better understand what the withholdings are in everyone's paycheck. When you receive your paycheck, you should examine the attached pay stub to ensure your pay was calculated and disbursed accurately. The pay stub provides details of what you earned and how your pay is d ivided up for take-home pay, taxes, and any deductions for expenses. Examine the information included on the paycheck stub as you complete this activity."

"Directions: Tom needs help understanding his pay stub. Please answer the questions on the sheet provided in order to help him out. "
- Paycheck Withholdings [ Download ] null
- Key to Paycheck Withholdings [ Download ] null

Assessment - Paying Yourself First

In Assignment 2-3, you are asked to create a budget using your financial plan from Unit 1. Read pages 20 and 21 and then do assignment 2-3 to be handed in at the end of the class period, or turned in the following day.