Chelly Lim

Economics/ 6^th

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Sometime in an adult’s life, we = need to keep a record of our spending, expenses, and income. Its importance is, = as young adults we can prevent ourselves from overspending or going into debt. This is called a budget. As a high school drop-out without a high sc= hool diploma I am limited to employment opportunities. The jobs that are availab= le with my education level are considered blue-collared jobs. Out of th= ose jobs, I applied as a waitress and was hired. As a waitress my annual inc= ome is $17,300. In a year, my expenditures is $25,869.64 and I’m $714.14 in debt and I have zero money for discr= etionary funds. With the expenses I have and my low income I had to make alternative= s so I wouldn’t be in as much debt as possible.

&= nbsp; According to my budget, I had to make a choice whether to buy a car or taking the Mun= i. My choice was Muni, because with the expenses involved with a car such as c= ar payments, insurance, and maintenance I would be in debt for years. Taking t= he bus saves me hundreds where as a monthly payment of $45 can do the same thi= ng. Another alternative I made was renting a cheaper apartment that consist roommates. At first, I was renting a apartment for $875 but realized that w= as way too much for me to afford, so I settled with looking for a cheaper apartment were I can split the payment according to how many people lived in the apartment. Based on the pie chart, I spend 21% of my income on housing.= The third choice I made was cutting down on personal needs such as entertainmen= t, shopping, and beautification goods. With those combined, I send 8% on perso= nal needs. Even though it was a small percentage I still couldn’t afford = these monthly expenses but, if I had extra m= oney I will provide these things when really needed. As for telephone I couldnR= 17;t afford a land line and a cell phone so I limited myself to a cell instead. Although, the percentage are small for each spending there are over 13 categories were I have to divide my income. With the decisions I made there we= re consequences.

&= nbsp; The cost of taking the bus is the hour ride from work to my apartment and the t= ime wasted if I miss your bus. Another cost of not having a car is that it̵= 7;s harder to do grocery and laundry since I have to carry everything myself. W= ith all the cost in not having a car, a Muni pass is the only thing that I can afford so it benefits me because I’m not spending a lot of money on transportation. In order for me to get by, I needed to rent an apartment th= at had a reasonable price but the catch was you had roommates. The cost of liv= ing in a cheaper apartment is you have to share everything with your roommates.= If I don’t like your roommate I couldn’t do much besides moving out. Another cost is privacy, that since I share an apartment I can’t real= ly do what I want or I’m always getting interrupted. In contrast, the benefit of having a cheaper apartment with roommates is that the utilities = are spilt in half; not one person is paying for everything. Lastly, the cost of= not sending money of personal things is that I’m not treating myself out = or that I won’t be able to pamper myself. The benefit is that with the m= oney I’m not spending I can save it for emergency or it can prevent me from overspending.

&= nbsp; From my budget, I am able to plan future events because from keeping track of my expenses I can determine when I’ll have enough money to get my own pl= ace, hopefully buy a used car, and have money to afford other needs. Also, I can keep track of how many more years I have to pay for my debt and my credit c= ards. Having a budget will keep me organized and prevent me from being a “shopaholic “.

&= nbsp; In this budget experience, it taught me how important it is to keep track of y= our money. Before this project I thought it would be ok to always spend money on personal things but I didn’t realize how bills and other expenses take all your money away. Another useful hit I learned was to find credit cards = with low APR and that I should start saving now for future plans. As a result of= my education level in this project, I learned that the higher education level = you have the more money you make. In order for me to have a white-collared j= ob I must get my bachelor degree in able to provide for my expenses. From this project I think I would really use a budget as I get older. It’s a helpful method to keep track of my money and it helps me divide my income f= or better uses.

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