Question

Jamie Lee Jackson, age 24, now a busy full-time college student and part-time bakery clerk, has been trying to organize all of her priorities, including her budget. She has been wondering if she is allocating enough of her income towards savings, which includes accumulating enough money towards the $7,000 down payment she needs to begin her dream of opening a cupcake café.

Jamie Lee has been making regular deposits to both her regular, as well as her emergency savings account. She would really like to sit down and get a clearer picture of how much she is spending on various expenses, including rent, utilities, entertainment and how her debt compares to her savings and assets. She realizes that she must stay on track and keep a detailed budget if she is to realize her dream of being self-employed after college graduation.

Use the details below to complete Jamie Lee's personal financial plan to determine her financial position. Enter "0" for any unused categories.

Current Financial Situation

Assets:			Monthly Expenses:
Checking account	$1,800		Rent obligation	$220
Emergency fund savings account	$4,200		Utilities/electricity	$70
Car	$5,100		Utilities/water	$30
Computer & iPad	$1,050		Utilities/cable TV	$115
Liabilities:			Food	$110
Student loan	$6,500		Gas/maintenance	$90
Credit card balance	$950		Credit card payment	$40
Income:			Car insurance	$40
Gross monthly salary	$2,105		Clothing	$40
Net monthly salary	$1,535		Entertainment:
Savings allocation:			Cake decorating class	$85
Regular savings	$125		Movies with friends	$45
Rainy day savings	$50

Assets Liquid assets Checking account balance Savings/money market accounts, funds Cash value of life insurance Other Total liquid assets Household assets and possessions Current market value of home Market value of automobiles Furniture Computer, electronics, camera Jewelry Other Other Total household assets Investment assets Savings certificates Stocks and bonds Retirement accounts Mutual funds Other Total investment assets Total assets Liabilities Current liabilities Charge account and credit card balances Loan balances Other Total current liabilities Long-term liabilities Mortgage Other Total long-term liabilities Total liabilities Net Worth (Assets minus liabilities)

Answer 1

The following are the data inputs in spreadsheet:

A B Assets 1 Liquid assets 2 Checking account balance Savings/money market accounts, funds Cash value of life insurance 3 1800 4 4200 5 Other C 6 =SUM(B3:B6) Total liquid assets 7 Household assets and possessions 9 Current market value of home 10 0 Market value of automobiles 11 5100 Furniture 12 Computer, electronics, camera 13 1050 Jewelry 14 Other 15 C Other 16 C =SUM (B10:B16) Total household assets 17 18 19 Investment assets 20 Savings certificates Stocks and bonds 21 C Retirement accounts 22 C Mutual funds 23 C 24 Other C - SUM(B18: B24) Total investment assets 25 Total assets =C7+C17+C25 26 27 Liabilities 28 Current liabilities 29 30 Charge account and credit card balances 950 Loan balances 6500 31 32 Other =SUM(B30:B32) Total current liabilities 33 34 35 Long-term liabilities 36 Mortgage C Other 37 C =SUM(B36:B37) Total long-term liabilities 38 Total liabilities 39 -C33+C38 40 Net Worth 41 (Assets minus liabilitites) -C26-C39 42

The following are the obtained results in spreadsheet:

A B C Assets 1 Liquid assets 2 $1,800 3 Checking account balance Savings/money market accounts, funds $4,200 4 Cash value of life insurance $0 $0 Other 6 $6,000 Total liquid assets 7 8 Household assets and possessions 9 $0 10 Current market value of home $5,100 11 Market value of automobiles $0 Furniture 12 $1,050 Computer, electronics, camera 13 $0 Jewelry 14 $0 15 Other Other $0 16 $6,150 Total household assets 17 18 Investment assets 19 $0 $0 Savings certificates 20 Stocks and bonds 21 $0 Retirement accounts 22 Mutual funds $0 23 $0 24 Other $0 Total investment assets 25 Total assets $12,150 26 27 Liabilities 28 Current liabilities 29 $950 30 Charge account and credit card balances Loan balances $6,500 31 $0 32 Other Total current liabilities $7,450 33 34 Long-term liabilities 35 $0 36 Mortgage $0 Other 37 $0 Total long-term liabilities 38 Total liabilities $7,450 39 40 Net Worth 41 (Assets minus liabilitites) $4,700 42