•
•
•
NET INCOME
the amount
refers to .d fter taxes
you are P
31
~en
out.
have been
ME
GROSSINCO
1 mount
is the tota:work for,
of money yo
are
before taxes
taken out.
When salaries are paid, not all of the money is taken home. Some must
be paid to the Government of Barbados. This payment is known as
income tax. While it is not the most favourite term for some persons,
income tax helps the Government provide services to its citizens, such
as health care, the road and traffic system, housing of the poor and
many more services, which vary from country to country. When doing
your budget, you must allocate funds from your NET INCOME and not
your GROSS INCOME.
A
budget is an important financial tool.
It
is sometimes called a
"spending plan".
In the same way you plan your weekend -what
chores you may do or which movie you're going to watch - a budget is
a plan of action for your money. A budget can show you where your
money goes; and help you determine if you're spending and saving
wisely.
Let's introduce Laura. She's 15 and thinks that there is
no possible way she can save. In Laura's opinion, her
money can't be stretched enough to include savings.
Let's take a look at Laura's budget:
I~COME
Lunch money: $50.00 per week
Babysitting on weekends: $30.00 per week
EXPE~SES
. Lunch: $40.00 per week
Cinema: $20.00 per week
Clothes: $20.00 per week
