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Finance Literacy Unit

Finance Literacy Vocabulary

Taxes-are money people pay to support government.

Sales tax-is paid whenever you buy things. Most of the money collected from sales taxes is used for transportation (roads and bridges), public education, and aid to local governments for services they provide citizens.

Property tax-paid when you own property, such as a home.

Income tax-is paid when you have an income.

Payroll tax-Social Security tax and Medicare tax; both are taken out of your paycheck and paid to the federal government.

Social Security-is money that one gets back when one retires or becomes disabled.

Medicare- helps pay for many medical services for people 65 years or older.

Gross income-is the total amount of money you earn before deductions are subtracted.

Net income-is the amount of money you receive after deductions are subtracted from your gross income.

Deductions-include income taxes, payroll taxes, health insurance, and other optional supports.

Deposit-is money put into your account.

Withdrawl-money taken out of your account.

Balance-is the money in your account. It changes whenever you make a deposit or withdrawal.

Budget-is a plan for how much income will be received and how it will be spent, saved and shared.

Balanced budget-occurs when the total amount of money spent, saved and shared equals total income.

Vocabulary Resources:

Pearson Education. EnVision Math Volume 2.

Texas Council on Economic Education

Learning Expectations for this Unit….

1.) Define income tax, payroll tax, sales tax and property tax.

2.) Explain the difference between gross income and net income.

3.) Identify the advantages and disadvantages of different methods of payment, including check, credit card, debit card and electronic payments.

4.) Develop a system for keeping and using financial records.

5.) Balance a simple budget.

Methods of Payment…..

Sample Questions….

1.) How much property tax must be paid each monty when the property tax is $1,552 a year ?

2.) Macy's gross income was $598.65. His total deductions is $65.20. How much is Macy's net income ?

3.) Mrs. Smith earns $15 per hour and worked 40 hours. How much is Mrs. Smith's gross income ?

4.) What is the best method of payment (check, credit card, debit card, cash) for the following:

-$15 for sunglasses

-$1,300 for a new television

-$92.67 for electric bill

-$0.85 for a pack of gum

-$1,500 for a new furniture set

5.) Martin earned $200 mowing lawns. He spent $50.98, $20.00, and $12.45. How much can Martin save and still balance his budget?