Economics & Management Sciences - Term 3 - Week 1

A budget is a plan that helps us manage our money. It shows how much money we have, how much we need to spend, and how much we can save. Budgets are important because they help us make sure we do not spend more than we earn. By creating a budget, we can plan for our future needs and wants.

Let’s say you have R100 for the month. You might decide to spend R40 on snacks, R30 on a toy, and save R30 for a future outing. This is a simple budget that shows your income (R100) and your expenses (R40 + R30 = R70) along with your savings (R30).

As a class, we will create a budget for a school event. We will discuss how much money we might need for decorations, food, and activities. Each student will suggest an expense, and we will write it down. Then, we will total the expenses and see if we can stay within a budget of R500. This will help us understand how to plan and prioritize our spending.

Now it’s your turn! Create a simple budget for a personal project, like a birthday party or a school project. List your total income (how much money you have), your planned expenses (what you want to buy), and how much you will save. Use the template provided to organize your budget. Be prepared to share your budget with the class and explain your choices.

• A plan for spending money
• A type of bank account
• A way to earn money
• A list of expenses only

Answer: A plan for spending money

A budget is a plan that helps us manage our money by outlining how much we have and how we intend to spend it.

• To spend all your money
• To save money for future needs
• To avoid making any purchases
• To give money away

Answer: To save money for future needs

Having a budget helps us plan for future expenses and ensures we do not overspend.

Answer: Income and expenses

A budget typically includes your total income and the expenses you plan to incur.

• R150
• R250
• R100
• R50

Answer: R150

If you subtract R50 from R200, you are left with R150.

Answer: To keep money for future use instead of spending it now.

Saving money means setting aside some of your income for future needs or wants.

• Money you earn
• Money you save
• Money spent on a toy
• Money you receive as a gift

Answer: Money spent on a toy

An expense is any money that is spent on goods or services.

• Decide how much to spend
• List your income
• Choose what to buy
• Ignore your expenses

Answer: List your income

The first step in creating a budget is to know how much money you have coming in.