Step #5

Evaluate Your Budget

What to Do: Once you have entered all of your monthly expenses, your worksheet will show you whether or not you are “making ends meet.” Do your expenses exceed your income? If so, you must decide where to cut back so that your expenses do not exceed your income.

Now, create a chart that visually displays the results of your monthly budget. Explain the rationale for the type of chart that you choose. Chart needs to be properly titled and include an explanatory legend.


Now, select one of the unexpected financial problems listed below. Use word processing software to describe how you would adjust your budget to account for this unexpected expense. Explain your rationale. Construct, save and print your scenario.

Then, adjust your budget in your budget spreadsheet to account for this additional monthly expense. This is called a “what-if” analysis and represents one of the most useful features of spreadsheet software.

The Unexpected:

• You forget to pay your phone bill and your phone service is shut off. To turn it back on, the phone company wants $50.
• The lease on your apartment is up for renewal and the landlord wants a 5% increase. How much will your increase be? How will you adjust your budget to account for this increase?
• Your dog gets sick and the medicine costs $150.

Now, go back to your word processing software and write a report explaining what you’ve learned from this activity. Include information copied from the spreadsheet as illustration whenever possible. Include ways in which you might be able to stretch your budget (for example, take in a roommate to share the rent.)

Continue