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19 views

Assignment Work

Uploaded by

nitinydv567
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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ASSIGNMENT WORK

FINANCE FOR EVERYONE


NAME - NITIN KUMAR

ROLL NO. - 1378

COURSE - B.COM [PROG.]

Q1- How do you prioritize expenses and allocate funds in order to create
an effective and realistic personal budget ?

When prioritizing expenses, I start by focusing on fixed and essential costs such as rent or
water, food , electricity bill and travelling. These expenses must be covered first. Afterward, I
allocate funds for savings goals like emergency funds . I also leave room for discretionary
spending (e.g., dining out, hobbies) but within limits to avoid overspending. I follow the
50/30/20 rule: 50% on needs, 30% on wants, and 20% on savings or debt repayment

Q2 - What factors do you consider when setting financial goals within


your personal budget ?

When setting financial goals within a personal budget for three months,
consider these key factors:

1. Income

Allowance Amount: Ensure that the amount i receive from my parents is


consistent. If it fluctuates, plan your budget conservatively around the
minimum amount

2. Essential Expenses

Living Costs: Factor in rent fees, groceries, transportation, utilities, and any
academic costs like books

Emergency Fund: Set aside a portion of your budget for unexpected


situations (medical, repairs, etc.). This can be a goal within your savings.

3. Short-Term Goals
Savings for Upcoming Purchases: Consider saving for gadgets (laptops,
phones)

Emergency Reserve: Aim to build a small emergency fund over time in case
of unforeseen needs like medical costs or sudden travel expenses.

4. Long-Term Goals

Future Education Costs: If you're planning to pursue higher education


(post-graduation, study abroad), you may want to save a small portion of
your allowance toward those expenses.

Career Preparation: Saving for certifications, workshops, or tools that may


boost your career prospects.

Q3 - How do you handle unexpected expenses or emergencies within your


budgeting framework ?

Handling unexpected expenses or emergencies within a personal budget is


crucial, especially when my income is limited, such as receiving an
allowance from parents.

Q.4 Can you describe your approach to balancing saving for the future
and enjoying current lifestyle within your budget?

There is no specific approach because the source of money and balancing


with expenses can vary. However, I try to reduce unnecessary and
unexpected expenses while saving money for emergencies. This allows me
to save for the future and still enjoy my current lifestyle.

Q5 what role does tracking and reviewing expenses play in your ongoing
budget management ?

tracking and reviewing provides real-time information on spending


patterns enabling budget to make informed decisions about budget
allocation and identing potential area of overspending

Q6. How do you differentiate between 'needs' and 'wants' when making
financial decisions in your budget?

1. Needs: Essential Expenses:


Definition: Needs are the necessary expenses required for basic
survival, education, and well-being.
Examples:
Tuition and textbooks: These are mandatory for academic success.
Rent and utilities: Essential for housing and basic living conditions.
Groceries and basic hygiene products: Necessary for health and
daily functioning.
Transportation: I travel through metro to attend classes and some
other exp. (like going home )
Decision-making: Needs always take priority in budgeting.
2. Wants: Non-Essential
Definition: Wants are non-essential items that are nice to have but
not necessary for survival
Examples:
Eating out at restaurants or grabbing coffee frequently:
Convenience, but not essential.
New clothes or gadgets: Upgrades may be tempting but aren’t
always necessary.
Decision-making: Wants are considered only after needs have been
met. If there’s extra money left over after fulfilling all essential
expenses then i spend money on this items

Q7. What strategies do you employ to cut down on unnecessary expenses


and increase savings in your budget?"

For Fixed Expenses:

I aim to lower room rent to reduce cost


I minimize electricity usage by turning off lights and appliances when
not needed.
I try to reduce food costs by cooking at home and avoiding eating out.
I ensure emergency savings are set aside regularly and avoid tapping
into them unless necessary.

For Non-Fixed Expenses:

I limit shopping to essential items and avoid impulse purchases.


I avoid unnecessary travel unless it’s work-related or urgent.
I plan for unexpected expenses by keeping a buffer but ensure I don’t
overspend.
I track and reduce spending on entertainment and luxury items.

Overall, these strategies help me lower my expenses while maximizing my


savings, leading to a more balanced and sustainable personal budget.

ONE MONTH BUDGET


Money - 15,000

1. Essentials 7,500 [50%]

Rent - 4000

Groceries/food - 1500

transportation - 1500

Utilities(phone,internet, etc ) - 500

2.Wants 4500 [30%]

Entertainment(movies,subscriptions,etc) - 1000

eating out/ordering in - 1000

shopping(clothes,accessories,etc) - 1500

other leisure activities(sports,outing) - 1000

3.Savings/investments 3000[20%]

Savings for emergencies - 2000

investments - 1000

NEXT MONTH BUDGET


Money - 15,000

1. Essentials 7,500 [50%]

Rent - 4000
Groceries/food - 1500

transportation - 1500

Utilities(phone,internet, etc ) - 500

2.Wants 4500 [30%]

Entertainment(movies,subscriptions,etc) - 1000

eating out/ordering in - 1500

shopping(clothes,accessories,etc) - 1500

other leisure activities(sports,outing) - 500

3.Savings/investments 3000[20%]

Savings for emergencies - 2000

Investment - 1000

NEXT MONTH BUDGET


Money - 13,000

1. Essentials 7,500

Rent - 4000

Groceries/food - 1500

transportation - 1500

Utilities(phone,internet, etc ) - 500

2.Wants 3500

Entertainment(movies,subscriptions,etc) - 500

eating out/ordering in - 1000

shopping(clothes,accessories,etc) - 1500

other leisure activities(sports,outing) - 500


3.Savings 2000

Savings for emergencies - 2000

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