BUDGETING

ESSENTIAL QUESTION

How does creating a budget improve the financial decisions you make in your personal life?

OVERVIEW

The concept of a budget is essentially a plan for the money you expect to receive and the money you expect to spend. While it might sound funny to create a plan without exact numbers, budgets help to ensure money is not overspent and aids in the practice of saving money. Although estimation accounts for a large portion of the budget, people who budget their money are typically more financially stable than those who do not. This is also true when organizing and planning an event, such as a concert. Generally, the purpose of hosting a fundraiser or event is to generate funds. It is imperative to create a budget that will distribute funds wisely and maximize profits.

When creating a budget, you must estimate your expected income and expenses. Income can simply be defined as the money received. Ticket sales and sponsorships typically account for the largest portion of event income. However, designing your event to generate income in multiple ways is wise, especially for events intended to raise funds. This can be accomplished through selling t-shirts, offering vendor rental space and concessions. These are only a few options. Be creative when discussing ways to increase income. Expenses, or expenditures, can be simply defined as money spent. Expenses cannot be avoided when hosting an event. However, they can be minimized greatly through strategic planning. Some businesses may be willing to donate items or offer a discount in exchange for advertisement. Be persuasive and polite when soliciting assistance. A good sales pitch will go a long way. It is important to remember when hosting an event, it is not uncommon to run into hidden or unexpected expenses. A good budget will allow for unexpected expenses and ensure the financial success of the event. Life Application: Plan for the unexpected. Unfortunate circumstances will occur, and you will be glad you did.

Once your budget is complete, the budgeting process is not finished. Updating and adjusting your budget on a regular basis will allow for a more accurate assessment of your goal achievement progress. It will also assist in making informed decisions regarding your event.

OBJECTIVES

Upon completion of this lesson, students will develop the skills through which they may:

Understand the concept and importance of budgeting.
Use cost analysis evaluation to ensure maximization of net profits.
Develop an event budget.

Click HERE to see the full lesson plan with activities.

STANDARDS

COMMON CORE STATE STANDARDS

Literacy Standards for Grades 6-12: History/Social Studies, Science and Technical Subjects

College and Career Readiness Reading Anchor Standards for Grades 6-12

Reading 1: Read closely to determine what the text says explicitly and to make logical inference from it; cite specific textual evidence when writing or speaking to support conclusions drawn from the text.

Reading 4: Interpret words and phrases as they are used in a text, including determining technical, connotative, and figurative meanings, and analyze how specific word choices shape meaning or tone.

Reading 7: Integrate and evaluate content presented in diverse media and formats, including visually and quantitatively, as well as in words.

Reading 10: Read and comprehend complex literary and informational texts independently and proficiently.

Literacy Standards for Grades 6-12: History/Social Studies, Science and Technical Subjects

College and Career Readiness Writing Anchor Standards for Grades 6-12

Writing 4: Produce clear and coherent writing in which the development, organization, and style are appropriate to task, purpose, and audience.

Writing 10: Write routinely over extended time frames (time for research, reflection, and revision) and shorter time frames (a single sitting or a day or two) for a range of tasks, purposes, and audiences.

Literacy Standards for Grades 6-12: History/Social Studies, Science and Technical Subjects

College and Career Readiness Anchor Standards for Speaking and Listening for Grades 6-12

Literacy 1: Prepare for and participate effectively in a range of conversations and collaborations with diverse partners, building on others' ideas and expressing their own clearly and persuasively.

Literacy 2: Integrate and evaluate information presented in diverse media and formats, including visually, quantitatively, and orally.

Literacy 4: Present information, findings, and supporting evidence such that listeners can follow the line of reasoning and the organization, development, and style are appropriate to task, purpose, and audience.

Literacy 6: Adapt speech to a variety of contexts and communicative tasks, demonstrating command of formal English when indicated or appropriate.

Literacy Standards for Grades 6-12: History/Social Studies, Science and Technical Subjects

College and Career Readiness Anchor Standards for Language for Grades 6-12

Language 1: Demonstrate command of the conventions of standard English grammar and usage when writing or speaking.

Language 4: Determine or clarify the meaning of unknown and multiple-meaning words and phrases by using context clues, analyzing meaningful word parts, and consulting general and specialized reference materials, as appropriate.

Language 6: Acquire and use accurately a range of general academic and domain-specific words and phrases sufficient for reading, writing, speaking, and listening at the college and career readiness level; demonstrate independence in gathering vocabulary knowledge when encountering an unknown term important to comprehension or expression.

Standards for Mathematical Practice

MP1: Make sense of problems and preserve in solving them.

MP4: Model with mathematics.

MP5: Use appropriate tools strategically.

MP6: Attend to precision.

MARKETING COMMON CAREER TECHNICAL CORE STANDARDS

1. Describe the impact of economics, economics systems, and entrepreneurship on marketing.

MK 1.1: Describe fundamental economic concepts used in marketing.

2. Implement marketing research to obtain and evaluate information for the creation of a marketing plan.

MK 2.1: Acquire a foundational knowledge of finance to understand its nature and scope.

MK 2.2: Implement accounting procedures to track money flow and to determine financial status.

MK 2.3: Analyze cost/profit relationships to guide business decision-making.

MK 2.4: Determine needed resources for a new marketing project or business venture.

MK 2.5: Manage financial resources to ensure solvency.

3. Plan, monitor, manage and maintain the use of financial resources for marketing activities.

5. Describe career opportunities and the means to achieve those opportunities in each of the Marketing Career Pathways.

MK 5.2: Develop personal traits to foster career advancement in marketing.

MK 5.6: Employ entrepreneurial discovery strategies in marketing.

8. Obtain, develop, maintain and improve a product or service mix in response to market opportunities.

MK 8.2: Generate product ideas to contribute to ongoing business success.

NATIONAL STANDARDS FOR BUSINESS EDUCATION

Communication

I. Foundations of Communication – Communicate in a clear, complete, concise, correct, and courteous manner on personal and professional levels.

II. Societal Communication – apply basic social communication skills in personal and professional situations.

Computation

I. Mathematical Foundations - Apply basic mathematical operations to solve problems.

II. Number Relationships and Operations - Solve problems involving whole numbers, decimals, fractions, percents, ratios, averages, and proportions.

III. Patterns, Functions, and Algebra – Use algebraic operations to solve problems.

IV. Measurements - Use common international standards of measurement when solving problems.

VI. Problem-Solving Applications - Use mathematical procedures to analyze and solve business problems.

Economics

I. Allocation of Resources – Assess opportunity costs and trade-offs involved in making choices about how to use scarce economic resources.

Personal Finance

I. Personal Decision Making - Use a rational decision-making process as it applies to the roles of citizens, workers, and consumers.

III. Managing Finances and Budgeting – Develop and evaluate a spending/savings plan.

V. Buying Goods and Services – Apply a decision-making model to maximize consumer satisfaction when buying goods and services.

Entrepreneurship

IV. Finance - Use the financial concepts and tools needed by the entrepreneur in making business decisions.

Information Technology

IV. Input Technologies – Use various input technologies to enter and manipulate information appropriately.

VIII. Information Retrieval and Synthesis – Gather, evaluate, use, cite, and disseminate information from technology sources.