Personal Budget Assignment - Business Plan Example

Budget Assignment Response to question Part i. Clear Checkbook Graphs and Spending Patterns The pie charts below represent my budget expenditure from the month of September to November. From the observation of my spending in the past three months, I found out that it has reduced with a great magnitude. In the period between September, October, and November, I happen to spend a total of $ 73.68 (3.3% for September, and 0.8% for October) in the restaurant or bar each month for a total of $79. The expense for my house was almost similar in each month since this section involves utilities, cable, and rent that are normally fixed costs. This is so because each of the listed items is covered by a one-year contract. In this case, this contract obligation makes me not to change or alter my housing expense up to when the term will expire. In a period of three months, I spend approximately $ 41 (1.8% in the month of September and 2.7% in the month of October) in gasoline or automotives. For the whole period, I used about $62. Apart from this, I spend about $48 on groceries alone. This expenditure was approximately 22% of my total expenditure, and it demands some improvements. This amount is subject to adjustment each week, but it has always been my preference to maintain a minimum expenditure in groceries because of the financial limitations within my budget. Additionally, my expenditure in September was higher than that of October. This is so because I had allocated my roommate some part of the grocery bill went home after the completion of the semester In addition to this, I spent approximately $ 2000 (90% in September, and 96% in October) in general merchandise. My expenditure for September was extremely higher than that of October. This happened because, in the month of September, I bought a new watch without budgeting for it. In the same month, I bought a number of school cloths. In the month of October, my expenditure was smaller because I did not buy more things out of impulse. The only thing that I spend for this month was on umbrella. This area is prone to improvement due to the application of impulse into the budgeting whenever I go for shopping. The other group of items that I can improve its expenditure is Automotive or Gasoline expenses. In this category of items, I spend a total of $41which is approximately 105 of my expenses for my whole term. In the month of September, this expense was high since I involved myself into a lot of driving for the whole of my summer internship. In the same month, my broke down thus making me have car repairs that were not expected or budgeted for that term. This expenditure area requires improvement. In this case, I have plans to make efforts of reducing this expenditure. In the month of September, I did spend about $ 21 for the entire month. This was so because I decided to be walking to many places such as to my new job in the Union of Starbucks. Additionally, the expense that also needs to be lowered since it is unnecessary is my Bar/restaurant expenditure. In my budget evaluation, I found out that I have been spending approximately 8% of my whole expenses. Most of this expenses happened in the month of September. This was so because a friend of mine turned twenty one making me to buy most of his drinks during his birthday party. That night was extremely expensive to the extent that I do not wish to spend in that manner any time soon. Apart from this, if I compare my present income to my prior income (during internship), it is vivid that, I have a lower income than the prior income. This small income necessitates me to reduce this expense since it will certainly bring deficits into my budget. Another category of items that I would wish to comment on is the sector of miscellaneous expenses. In this category, for the whole session I only used approximately 1% of my total expenditure in this expense. Even though, the percentage is small I still have a strong conviction that I can improve these categories of expenditure. In the month of September, I spent about 2% ($18) for the entire term on one movie ticket. In October and November, I spent $1(1%) on a Den pop. This expenditure is slightly lower than the other expenses in my budget. Nevertheless, the expense is still considered to be high thus in need of some adjustments. Reducing my miscellaneous expenses would help a immense deal in cutting down my budget. For instance, when I shift and start using Red box instead of tickets, it would have an effect of reducing my income by $25. As much as this may appear to be extremely small, it could equivalent to one Microsoft share cost. Part ii. Over the past three months, my expense included bulls, rent, gas, food, and groceries, going out, and shopping. In each month, my parents provide for me some money for food, bills, and rent. From them, my monthly budget is always $3000. From this budget, about $ 2000 goes to rent, $500 is used for bills, and the remaining amount is directed to the purchase of groceries for the whole month. Additionally, I have a part time job within the campus near the Union at the Starbucks. The part time job enables me to earn some income in every two weeks. This income is extremely beneficial because it helps to finance my extra costs like going out and the bar and restaurant cost. The money from my part time job finances my extra expenses, therefore, making me not to ask the money for my additional expense from my parents. After going through my expenses, it would be prudent to note that my monthly income is enough in managing all my expenses. In this respect, with little adjustments and improvements of my budget, the money from parents and that from the part time job would satisfy all my income accordingly. Response to question 2. The line graphs below represent my expenditure in comparison to that of the class for the past three months. Individual versus Class Spending After a keen observation of the graph that is projected, above, there are a number of aspects that can be deduced from the graphs. From the comparison, I found out that my expenditure for rent is higher than the average of the class. I reside in an apartment that is the most expensive on the campus. This apartment is within a walking distance from all my classes. Currently I normally spend about $ 300 each month on rent. On the other hand, the class spends an about $ 174 in September and 190 in October. This may not be an accurate representation of the average of a class. In my own observation, this is extremely low, and there are some factors, which can be attributed to such a low cost. Some of these factors include the number of individuals living in dorms. The students were requested to list the rent, but misunderstood the question and gave out $0 as the expense for their room. Other cases happened when some students failed to give a report of their rent. This lowered the average of the class. In the graph of miscellaneous expenses, I used to spend about $50 more than the average class expenditure. After making some adjustments in my budget, I will realize some reductions in my daily expenditure at least up to the class average expenditure hence making it to fall below the average expenditure. In other categories of expenditures, the average is lower than my expenditure. Despite this, I still believe that the lower figure is due to many students who fail to give out their details and those students who reside in the dorms. This is so because; it lowers the average spending of a class in the different categories. Response to question 3. Budget for Projected month: December. DECEMBER 2012 Sunday Monday Tuesday Wednesday Thursday Friday Saturday 1 2 3 $10 – Cactus $300 - Rent 4 5 6 7 8 9 10 $50 – Groceries (Wal-Mart) $20 - Gas $10 – Cactus 11 12 13 14 15 16 17 $10 – School Supplies $8 – Campus Bars 18 19 20 21 22 23 24 $50 – Groceries (Wal-Mart) $20 - Gas $10 – Cactus 25 26 27 28 29 30 $11 – Applebee’s Part i. In the first week, I may spend about $310. In many cases, rent may be due by first. Additionally, I may prefer to visit cactus each, Thursday with my friends. In the second week, I may spend about $80.1. In the same week, I may go to Wal-mart at least two weeks every Sunday in order to gather my groceries thus spending an average of $ 50. When it comes to filling up of my gas, the same process will follow. This is so because I normally fill my tank gas on Tuesdays. This category costs me about $20. On Thursdays I normally go to cactus together with my friends. In the third week, I will spend about $18, which would be more than the first two weeks. In the fourth week, the spending would involve items like groceries, cactus, and gas. The total of this expenditure would be about $80. In the last week, I may spend about $11 going out to my friend’s dinner. In the whole month, I may spend a total of about $500 in which $300 may be rent. This would be a significant improvement from my prior level of expenditure. If I strictly go through my new budge without any compromise, I would be able to save a substantial amount of money. Part ii. In order to stay within my budget, I am going to initiate two action plans. These include: Action Plan 1: It is vivid in my budget that I may quit going out to bars and restaurants in many occasions and only visit these places whenever there are a special occasions. This will make me save a substantial amount of money each Thursdays and weekend. Action Plan 2: The next thing that I have considered to reduce in expenditure is spending on Starbucks. I have decided that I will reduce the number of times that I would be visiting the Starbucks. This will equally make to have some savings. In order to implement this new changes, I will be obtaining my coffee from Wal-Mart then prepare it at my home. Reference. ClearCheckbook. (2006). Money management made easy. Retrived on 17th November 2012. Read More