SOC 2433 The Family and Society
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P3: Exercise in Low Income Family Budgeting
Click to download this assignment P3 Family Budget Assignment
Work in a group of up to three people for this exercise, so that you can divide the
work of locating information among yourselves. Turn in one paper for the group.
Dan (25) and Marie (23) have two children Sarah (5) and David (2). Daniel started working right out of high school because he was able to work at a job that paid well. They got married young and had their first child by the time Marie was 18. Dan and Marie are moving to Duluth, and will arrive with enough furniture for a small apartment. Unfortunately, Dan and Marie have no relatives nearby and none that are in any financial posture to help with monthly expenses. Your will create an estimated income based on job listings in Duluth, then find them a place to live and estimate their expenses.
Each item in your budget must be documented. For instance, if you find a listing for an apartment in the paper, you need to copy it and put the
name of the newspaper and the date of issue on the copy, and submit that with your report. When you list jobs for Dan or Marie, you will need a Xerox copy or printout of the ad you found.
Your report will have three components:
1) Income.
How much money can they make to support themselves? Be realistic in your choices of jobs.
For instance, if you use a job as a mechanic for one person, you cannot also use a job as an
x-ray technician for that person: it is unrealistic to think that one person would have both sets of skills.
Average the income from 3 jobs for each person as an estimate of a young high school graduate might be
able to earn in Duluth right now. Once you have an annual amount, use the calculator at
PayCheckCity.com to compute how much will be left after taxes.
2) Expenses
Locate reliable information on each type of expense. For instance, find an ad for an apartment that
includes information about heat, water, and electric expenses. Go to the web sites for utilities to find
the cost for any utility that is not included with the apartment or house that you rent.
Use the cost of Minnesota Care for your income range to compute the cost of health insurance.
Choose one of the USDA Food Plans to estimate the cost of food. Be sure to read explore what foods
will be included on this food plan. See http://www.cnpp.usda.gov/USDAFoodCost-Home.htm
Find other legitimate sources of information for other costs. Contact a local landline phone company and find out if it is less expensive than a cell phone plan. Choose what kind of plan Dan and Marie will have.
Consider whether to include some expenses at all. Can Dan and Marie afford cable TV?
Try to make their budget work out so that they do not have to borrow money.
3) Write a narrative description, about 1 page in length, describing the choices your group made in
planning Dan and Marie’s budget. What items are not yet on the budget? What things did you have to give up? What things were important to hang on to?
Finally, describe what you learned in the process of gathering the information and assembling the
household budget for this family. How does it relate to Seccombe’s textbook?
Income
Begin by estimating income. Decide what marital script Dan and Marie are following (complementary, parallel, modified parallel, etc) and how many hours a week each one will work.
For each person, locate 3 jobs for which he or she is eligible with a High School diploma. Determine the annual income before taxes from each of the 3 jobs, and average those incomes. Assign the average income from 3 jobs to Marie, and the average income from 3 jobs to Dan.
| Source of Income | Employer, job title, and annual income | Average income (3 jobs) |
| Job #1 for Dan | ||
| Job #2 for Dan | ||
| Job #3 for Dan | ||
| Job #1 for Marie | ||
| Job #2 for Marie | ||
| Job #3 for Marie | ||
| Total household income | ||
| Subtract Taxes: State, Federal, Social Security | See PayCheckCity.com | |
| Income available for spending |
Expenses
| Expense | Monthly cost | x12 = Annual cost |
| Rent | ||
| Transportation (DTA bus pass only if near enough to bus line) |
||
| Health Insurance Consider Minnesota Care |
||
| Food Look at USDA food budgets online |
||
| Child care Pay for care whenever both parents are at work |
||
| Telephone Consider landlines, cell, and how many phones |
||
| Medicine/health supplies | ||
| Clothing
See USDA or govt budgets |
||
| Utilities (TV, electricity, heat) |
||
| Personal care Haircuts, toothpaste, etc |
||
| Entertainment Eating out, children’s toys, movies, etc. |
||
| Put away to savings | ||
| TOTAL EXPENSES | ||
| Disposable income for necessities not listed and vacations |
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