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5888355-825500314325000Independent Living TWENTY-SOMETHING SIMULATION PROJECT499427564135005041901333500You are twenty-something and it is time to move out of your parent's home. You work 40 hours per week and your wage is $18.00 per hour gross income. You will be required to calculate your net income and hypothetical rent accommodations, cost of buying a car, food, clothes, etc. The purpose of this project is to help you learn how to budget and manage financial resources effectively. You may choose to live with a roommate and share rent, but you must each complete and hand in a separate booklets with a separate budget. Good luck!Name: ___________________________ Roommate: ________________________ 5716905-47942500PAYCHEQUE DEFINITIONSGross income(pay/earnings) ______________________________________________________________________________________________________________________________________________________ net income (pay/earnings)______________________________________________________________________________________________________________________________________________________ CPP (Canadian Pension Plan)______________________________________________________________________________________________________________________________________________________ EI (Employment Insurance)______________________________________________________________________________________________________________________________________________________ Income Tax______________________________________________________________________________________________________________________________________________________ LTD (Long Term Disability) ______________________________________________________________________________________________________________________________________________________ Union Dues______________________________________________________________________________________________________________________________________________________ Bonds______________________________________________________________________________________________________________________________________________________ Credit score _____________________________________________________________________________________________________________________________________________ RRSP (Registered Retirement Savings Plan)______________________________________________________________________________________________________________________________________________________ RESP (Registered Education Savings Plan)______________________________________________________________________________________________________________________________________________________ TFSA (Tax Free Savings Account)______________________________________________________________________________________________________________________________________________________ Line of Credit______________________________________________________________________________________________________________________________________________________ Mortgage______________________________________________________________________________________________________________________________________________________ GIC (Guaranteed Investment Certificate) ______________________________________________________________________________________________________________________________________________________ /16Now calculate your net monthly income:$1 8.00 per hour X 8 hours per day X 21 days per month = Gross Income $._________/1Gross Income$________ X 19% = Income Tax Deduction $ ________/1Gross Income $ ________X 2.3% = CPP -Canada Pension Plan $ ________/1Gross Income $:________X 2.5% = EI - Employment Insurance$________/1Gross Income $ ________X 1% = Union Dues $____________/1Income Tax + CPP + EI + Union Dues= Paycheque Deductions $ ___________________/1Gross Income$ _______________/1-Paycheque Deductions$____________/1= Net Income$_______________/259226457810500To have a roommate ... or not???Determine the advantages and disadvantages of living on your own or having a roommate. For the purposes of this project, you may not choose more than one roommate.AdvantagesDisadvantagesLive on My Own1.2.3.1.2.3.Live With A Room Mate1.2.3.1.2.3.My decision is to _______________________________________________37915855080000I believe this is the best choice because: 5764530000ACCOMMODATION OPTIONSType of Rental AccommodationAdvantagesDisadvantagesRental CostsTownhouse or Duplex1.2.3.1.2.3.Apartment1.2.3.1.2.3.Single Detached House1.2.3.1.2.3.DECISIONS FOR CONSUMERSFor each of the following situations, decide which kind of housing would be best. Give reasons for your decisions.A retired couple with no children do not want to cut grass or handle other maintenance.___________________________________________________________________________Middle aged couple with two small children desires room for children and friends who visit.___________________________________________________________________________A young couple with a small child.___________________________________________________________________________Young, single person travels frequently for a job___________________________________________________________________________390525000RENTAL ACCOMMODATIONWhat Type of home or apartment do you picture yourself in when you decide move out? How does this reflect your values?____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________For the purposes of this simulation you will consider rental properties only. Find a place to rent by looking in the “For Rent" section of the newspaper or rental guide and locate an ad for suitable apartment, town house or house. Call to find out the monthly rental charge without being committed to a long term lease agreement. Paste or take the ad in the following space. You should not spend more than 35% of your net income on rent and utilities.Monthly cost of Renting House/Apartment:_____________________Other Rental ExpensesTenant Insurance: When you rent a home or apartment you must also have tenant insurance in case of fire, theft, flooding or natural disaster. Your landlord will have insurance on the building, but not on your personal possessions. On the following chart, find the cost per year that is closest to the replacement value of what you hope to own when you are 27. Beside it is an example of the yearly insurance premium you might need to pay.Replacement Coverage $10,000$20,000$30,000$40,000$50,000$60,000Annual premiums:$92 per year$159 per year$208 per year$268 per year$304 per year$367 per yearLocate the yearly premium you might have to pay. Divide this by 12 to give the monthly payment:125031538100 ________________ /12 ______________________ (Yearly insurance premium) = (Monthly insurance premium) 00 ________________ /12 ______________________ (Yearly insurance premium) = (Monthly insurance premium) 61563259525000716343538925500 Electricity: An average two bedroom apartment in Alberta with two people living in it will cost about $65 per month for electricity. A larger apartment or townhouse will cost about $82. A small 1100 square foot home with the usual appliances will cost $110.00 per month for electricity. A large executive-type home with many appliances, a hot tub and air conditioning will cost may cost over $180.00 per month. C. Estimate of the electricity cost for your house/apartment: $___________Natural Gas: It is hard to estimate utilities because they vary so much depending on different circumstances. Here are some very rough guidelines of how much they might cost in Alberta.?Small townhouse apartment$94 per month?Average 1200 sq. ft. house$94 per month?New energy efficient average home (1022 sq. ft.)$110 per month ?Large New home (1800 sq. ft.)$130 per month?Larger older home with heated garage$145 per monthD. Based on these rough guidelines, how much do you think the gas for furnace and water heater for your house might cost? $_____________Water and Sewer: For a small town home, water and sewer costs approximately (40.00 per month.For an average home $60.00 Cost $__________ E. Sewer and Water Cost: $_______________Utilities: Natural gas, water and sewage are usually include in the rent unless the rental home has an outside entrance(house, townhouse or duplex,) in which case they are not usually included.612838588265005. Telephone: There are two type of phone service that are available, home phone and cellular phone. A home phone is beneficial if you use a phone to make long distance calls or are limited to a number of minutes on your cellular. Home phone service starts at $20 per month and goes up depending on what extra service you add on. A cellular phone usually requires a contract in which you agree to pay for services for a specified period of time in exchange for the services that you require. There are many options that can increase your monthly bill, think about what you will use. Also, a discounted rate isavailable on the purchase of a handset. Indicate what type of phone service(s) you will be using:Home Phone:___________________________ ________________________(Service Provider)(Monthly Plan Cost)Cellular Phone: _______________________________ ________________________(Service Provider)(Monthly Plan Cost)Cost of phone:$_____________________ Total Monthly Telephone Cost:$_____________________Cable TV: In Alberta Cable TV cost $35.00 per. Month for “Basic Cable” for “Classic Cable” Depending on what you want, things like HD, movie channels or premium channels like NHL Center Ice will increase your monthly costs. In order to access the premium content you will need to rent a cable box/PVR. Netflix’s is another option. If you want more channels the costs increase. Cable Television:________________________________ ________________________(Service Provider)(Monthly Plan Cost)30734026733500 PVR Rental Cost:$_______________________________Netflix’s(optional)$____________________________ G. Your Total Monthly Cable TV Cost: $____________610108029210007.) Internet Access {optional): Having internet access has become a part of most people’s lives. There are many different service providers that can accommodate many different types of users. Monthly plans start at about $30 per month and go up from there. Internet: ______ _ (Service Provider) (Monthly Plan Cost)Modem/router Rental cost:$_______________ H.Total Monthly cost for internet Cost: $________ 8. Bundles: Often you can bundle several services to save money. Bundles can be complicated but they are meant to suit your lifestyle. It is important to the budgeting process to understand where you are spending your money. Please indicate what services you are bundling. I._______________+________________+______________=$________ (Service #1) (Service #2) (Service #3) (Cost per month)748982529210..00.. TOTAL MONTHLY COST OF RENTING A HOUSE/APARTMENTA. Cost of House/Apartment Rental$______________B. Tenant Insurance$______________C. Electricity$______________D. Natural Gas$______________E. Sewer and Water$______________F. Telephone$______________G. Television$______________H. Internet$______________OrI. Bundle$______________Total Cost of Rental(add lines A, B, C,D, E and F, G, H, or I$______________Why did you choose this place to live? Does your roommate agree? How does this choice reflect your values?________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________MOVING-IN EXPENSES - As well as the monthly expenses there are one-time moving-in expenses to consider:a. When renting- damage deposit$__________(Must not exceed 1 month's rent)b. Hook-up costs Phone $45.00554799513208000 Power $22.00 Water $23.50 Cable $40.00 Internet $30.00 c. Deposits (Phone $500,Power Water$50) $615.00 d. Purchase of Telephones ($10-$200) $_____e. New furniture/appliances ($500-$5000) $_____ g. Moving costs ($50-$300) $_____ 848360149860TOTAL $___________ (Do not add to monthly totals) 00TOTAL $___________ (Do not add to monthly totals) 23139401240155007169150-18986500?.60096405715002540004127500TRANSPORTATION(Do separate from roommate)Find an advertisement for a car, vehicle that you would like to be driving when you move out. You may not choose a car which costs less than $3000.00. Place the ad below. Beside it write the price. How does this vehicle reflect your values?You will have to assume that you have saved enough to make a l 0% down payment and borrow the rest of the money.Total Price of VehicleSubtract Down Payment (10% of Total) Total Loan Amount$_________3706495408940$________00$________ $_________________Use the following table to find the monthly payments. If the amount of your loan is in between the table amounts you will have to estimate the monthly payment.If you finance for 48 months the monthly payment will be as follows:433070-185420Loan AmountMonthly Payment@ 8%Monthly Payment@ 10%Monthly Payment@12 %$2,700$66$68$71$3,000$73$76$79$4,000$97$101$105$5,000$122$126$131'$7,000$171$177$183$8,000$195$202$210$10,000$244$253$262$12,000$313$304$314$15,000$365$379$393$18,000$444$455$472$20,000$487$505$524$25,000$609$632$655$30,000$731$758$786$35,000$852$884$91700Loan AmountMonthly Payment@ 8%Monthly Payment@ 10%Monthly Payment@12 %$2,700$66$68$71$3,000$73$76$79$4,000$97$101$105$5,000$122$126$131'$7,000$171$177$183$8,000$195$202$210$10,000$244$253$262$12,000$313$304$314$15,000$365$379$393$18,000$444$455$472$20,000$487$505$524$25,000$609$632$655$30,000$731$758$786$35,000$852$884$917IIIMonthly Car Loan Payment$_______Now you know what it will cost to purchase the car. What about operating costs? Calculate how many kilometers you might drive in a week when you move out. Include driving to work, shopping, recreation, visiting, etc. Allow on average 250km for living within 15km of work. Multiply this by 4 to get the number of km per month. Km Driven per month ___________KmThe average cost of an average is approximately $0.30 per kilometre. This covers fuel, maintenance, tires, insurance, license, and registration and depreciation. To calculate your monthly driving costs, multiply the number of km driven per month by $0.30. If you have high insurance costs or an expensive car, you should multiply the kilometres by $0.34.34874203016250010464803016250087693530162500 x 0.30 =# of km driven per month monthly operating costNow calculate the total monthly cost: Monthly car loan payments $_______________ Monthly car expense $________Total Transportation expenses$_________ Another Transportation option is the city bus pass. As an adult you don’t qualify for a student bus pass. You will need to find out how much an adult bus pass costs. Monthly bus pass cost $______________ TRANSPORTATION DECISIONSAccording to your income, determine the method of transportation you will be utilizing. Answer all of the following questions.4158615136525001.Would you use your own car or public transportation? 2. What is the reason for your decision? _____________________ 3 If you choose not to purchase a vehicle state what other method of transportation you will use and why?93916525844500TOTAL TRANSPORTATION COST428053516446500What will be the monthly cost of transportation?$459105-437515005691505-55435500SHOPPING FOR FOODAssume the following is a shopping list of food to prepare three meals a day for one week. Research the price of these food items in your local grocery store. Be sure to choose the smallest quantities possible to buy. You may replace unwanted items with something from the same food group. ItemSize/QtyBrandPriceSpaghetti225 gCatelli$2.89Spaghetti saucepotatoeseggsdozenMilk1 Lbread1 loafButter/margarineFrozen Orange juiceChickenLean hamburgerApplesOrangesBananasLettuceInstant dinnersFrozen beansCorn nibletsPuddingPork chopsSandwich meatSolid white tunaPopCheddar cheeseCoffeeCerealIce creamMacaroni/cheeseIchiban noodlesMushroom soupChipsOlive oilKetchupTotal food expenses for one week$Total food expenses for one month(weekly multiplied by 4$58166007620000CLOTHING PURCHASESWhen calculating the cost of clothing for yourself, consider the type of work you plan to be doing and how important clothing is to you. Consider how many of each item of clothing you will purchase in a year and multiply this by cost per item.ItemNumberAverage CostTotalShirts/blousePantsCoats/jacketsswimsuitsShortst-shirts/topsSuits/dressesPajamasUnderwear/socks/tiesShoesSports clothingTotal for one year$Divided by 12=Total per month$(Put on page 15)HEALTH CARE AND HYGIENEDepending on where you work you may have Alberta Health Care paid by your employer. Some companies also pay for Blue Cross and Dental plans. If you do not have a good benefits package from you. Employer, you will have to pay:Alberta Health Care $63.50 per month for singleAlso allow a budget for dentist and prescription and over-the-counter medications. One visit to the dentist including checkup, x-rays and teeth cleaning is $380.00. If you are on a monthly prescription i.e. insulin, don’t forget to add this amount in.529336011176000Alberta Health Care$_________per month6067425-243840$______00$______Dental (divide into 12 equal) $_________per monthMedications (including optical)$_________per monthToiletries, make-up, haircuts, dry cleaning, etc. $_________per monthTotal cost per month$_________per month RECREATION AND ENTERTAINMENTRecreation is a highly personal item, which reflects personal values. It is important to budget for all non- work activities. In this section plan for such things as concerts, athletic or social club memberships, skiing, ·travelling, hobbies, buying a boat or other recreational equipment, music lessons, movies, videos, parties etc.503618510922000Movies, videos, concerts $_________per month Restaurants, eating out $_________per month Magazines, newspaper subscriptions$______ __per monthHobbies$_________per monthPets $_________per month Sports equipment $_________per monthEstimated total per month $_________per monthHow does this reflect you values?850904127500850901905008509032067500850909779000HOUSEHOLD MAINTENANCE AND FURNISHINGSBe sure to allow some money for routine maintenance and repairs, approximately $75.00 per month for an average household.Estimated total per month$__________SAVINGSWhen you move out what do you think you will be saving money for?List six or seven specific items:8318573660001.2. 3. 4. 5. 6.Remember you should always save money for emergencies such as a car accident, death of a family member, loss of a job, medical bills, a different lifestyle, etc.How much money would you like to save per year? Divide by 12 to determine monthly savings.Desired yearly savings divided by 12 = monthly savingsEstimated savings per month $____________OTHER INSURANCETenant and vehicle insurance are included with previous calculations but Life, Health and DisabilityInsurance must be considered ($20-$40 per month)Type(s) of Insurance _________________________Monthly Cost$ ______________MISCELLANEOUSWhat else do you spend your money on each month?Smoking and/or alcohol $________Educational Courses $_________Other (cleaning supplies, tools, film developing, repairs, etc. $_________SUMMARY OF TOTAL MONTHLY EXPENSES Using the preceding sheets, add up the total amount it would cost for you to live in the way you would like1. Housing $ /4438023030607000433133520955002. Transportation $ /44331335361950003. Food & Household Supplies $ /24. Clothing $ /2433133522860005. Charities and gifts$ /2 433133535242500433133542545006908165212725"''00"''6. Health and Hygiene $ /27. Recreation And Entertainment$ /2 4331335149225008. Household Maintenance$ /9. Savings $ _____________ /2 43313353524250010. Insurance $ /24331335268605001 1. Miscellaneous$ /2438023034607500Total Monthly Expenses$ /1438023034290000Your Net Monthly Income $ /1320675497205If the difference is positive you can afford your lifestyle if negative, you will need to cut back. Can you afford your lifestyle? YES NoIf yes, what will you do with the excess?00If the difference is positive you can afford your lifestyle if negative, you will need to cut back. Can you afford your lifestyle? YES NoIf yes, what will you do with the excess?453263035560000Difference ................
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