Money Management

By: Mallory Jasper

Depository Institutions

Millions of people use financial services offered by depository institutions on a daily basis to help them manage their money.

There are two types of depository institutions:

  • Commercial Banks- they offer financial services to both consumers and other businesses.
  • Credit Unions- They are owned by consumers and they offer many banking services.

Depository institutions offer a wide variety of financial services to their consumers. The services offered and the terms and conditions will vary for every depository institution. Some services include,

  • Credit
  • Financial Advice
  • Safe-Deposit Box
  • Special Needs Payment Instruments
  • Online Banking
  • Mobile Banking
  • Debit Cards

You should think really hard on what depository institution that you wan to use. When choosing a depository institution you should pick one that helps you meet your financial goals.


Everyone pays taxes to some extent. You are considered a taxpayer in the United States if you live here and pay taxes to national, state, county or municipal governments.

Taxes are charged in a variety of ways. Types include,
  • Income Tax
  • Payroll Tax
  • Property Tax
  • Sales Tax
  • Excise Tax

Earned income is money you earn from working for pay.

Unearned income is income received from sources other than employment.

You are better off being a member of a community that by yourself. A community is a group of people with common interests and concern for the common good.

The Statement of Financial Position

Net worth is a measure of financial wealth you have and it indicates the monetary value of all possessions that a person or household owns.

-You calculate your net worth by using the Statement of Financial Position.

The Statement of Financial Position is a statement describing your financial condition.

It is very important to keep track of where all your money is going. The Statement of Financial Position gives you tangible record to refer to and it helps you set your financial goals.

To find your net worth on your Statement of Financial Position you need to take your assets and subtract them from your liabilities.

The Income and Expense Statement

To keep track of where your money is coming from and going you should use an Income and Expenses Statement.

-An Income and Expense Statement is an important financial management tool that summarizes your past transactions to determine how you are earning and spending your money.

-The Income and Expenses Statement helps you objectively evaluate your past financial decisions.

  • Income- is money received
  • Expenses- is money spent

Expenses include: Savings and investing, insurance, housing, transportation, and food.

There are three types on income

  1. Earned Income
  2. Unearned Income
  3. Income Received from Government Programs

The Spending Plan

A spending Plan is forward-looking income and expense statement, sometimes refereed to as a budget.

-A Spending Plan records both [planned and actual income and expenses over a period of time.

-A spending Plan is very important because it helps you take control of your spendings, this then helps control your financial future.

A Spending Plan forces you to make good choices on your spellings. It makes you consider the opportunity costs of your planned purchases to help your money in a way that maximizes your financial well-being.

There are five steps when creating a Spending Plan...

  1. Track current income and expense
  2. Personalize your spending plan
  3. Allocate money to each category
  4. Implement and control
  5. Evaluate and make adjustments