You are never to young or to old to learn how to look after yourself financially. In this session you will not only look at why it is important to budget, but also to create a budget for yourself using an excel spreadsheet.

What skills should you have by the end of the session?

• Know what a budget is, why you need to budget and how to do it.
• Identify the basic components of an Excel spreadsheet: rows, columns, cells, and the formula bar.
• Enter data (text and numbers) into cells
• Use basic formulas to calculate values like total costs (Sum formula), subtracting and adding cell values.
• Basic cell formatting. (Colour the heading cells)

Activity 1:
Answer the following questions:
- What is a budget?
- Why should you create one?

Budgeting is the process of creating a plan or roadmap for managing your money, where you take what you will earn and see what amounts you can spend and on what within a specific timeframe. It's a way to help you take control of your finances and make intentional choices about how you use your money. Budgeting isn't just for adults; it's a valuable skill that everyone, including students, should learn in order to prosper financially.

Why Budgeting Matters:

1. Informed Spending Decisions: Budgeting allows you to have a clear picture of your income and expenses. By creating categories for your spending, you can make informed decisions about where your money goes. This means you're less likely to overspend on things that aren't essential and more likely to prioritize what truly is important.
2. Achieving Financial Goals: Setting financial goals, whether short-term or long-term, is essential for taking care of you future financial needs. Budgeting helps you allocate money towards essential goals systematically. Whether you want to save for a a new cellphone, or be able to look after yourself when you go and study further, a budget helps you track your progress and stay on track to make ends meet.
3. Avoiding Debt and Overspending: Without a budget, it's easy to overspend and end up in debt. A budget helps you control your spending, ensuring that you're not spending more than you earn.
4. Emergency Preparedness: Life is unpredictable, and unexpected expenses can arise at any time. Having a budget allows you to set aside funds for emergencies, creating a financial safety net that can help you weather unexpected storms without derailing your overall financial plan.
5. Reducing Stress: Financial stress is a common concern for many people. When you have a budget in place, you have a clear understanding of your financial situation and a plan to manage it. This knowledge can significantly reduce anxiety and stress related to money matters.
6. Developing Financial Discipline: Budgeting requires discipline and self-control. It helps you differentiate between what you need and what you want, encouraging you to prioritize essential expenses over impulsive purchases. This practice contributes to developing a healthy financial mindset.
7. Increasing Savings: Budgeting allows you to allocate a portion of your income towards savings. Whether it's for short-term needs, long-term investments, or retirement, consistent savings build financial security over time.

In summary, budgeting is a tool that empowers you to take charge of your financial journey. It enables you to make mindful choices about your spending, save money systematically, and work towards achieving your financial dreams. By understanding where your money is going and setting priorities, you'll be better equipped to make your money work for you, rather than feeling like you're always struggling to manage it.

Activity 2:
Scenario: You have been accepted into a college and will be getting a NSFAS allowance. You will be staying on your own. The NSFAS allowance state that you will receive a learning materials allowance valued at R5 460, a living allowance of R16 500 per annum, and an accommodation allowance at a capped amount of R45 000. Use an excel spreadsheet to draw up a monthly budget. (Divide the previous amounts by 12). You can also add additional funding as items and be sure that you think about all the items that you will need money for.

Instructions:

1. Open up Excel and immediately save your spreadsheet as a file (POE) in your school public folder under your name. (eg Peterson_Emmie_Gr11_Budget)
2. Add headings and items as per this example by typing it into the relevant cells. What are you going to need to spend your money on every month? Will you have enough money?

3. In the total Estimated cost row, under the Estimated column, add the =sum( ) formula, by dragging your curser over the cells that you want to add.
4. Copy the formula to the adjacent cells to get the sum of every column.
5. In the column under Difference ( subtract the Actual cost (B2) from the Estimated cost (C2) e.g. =C2-B2
6. Copy this formula all the way down.
7. Complete your budget and SAVE