Lesson Notes By Weeks and Term - Senior Secondary 3

Term: 1^st Term

Week: 3

Class: Senior Secondary School 3

Age: 17 years

Duration: 40 minutes of 2 periods each

Date:       

Subject:      Home management

Topic:-       Money management

SPECIFIC OBJECTIVES: At the end of the lesson, pupils should be able to

1. Discuss the meaning and importance of money management
2. Arrange the guidelines for money management
3. Highlight the steps in money management
4. Develop a family budget of N70,000 a month.

INSTRUCTIONAL TECHNIQUES: Identification, explanation, questions and answers, demonstration, videos from source

INSTRUCTIONAL MATERIALS: Videos, loud speaker, textbook, pictures

INSTRUCTIONAL PROCEDURES

PERIOD 1-2

PRESENTATION	TEACHER’S ACTIVITY	STUDENT’S ACTIVITY
STEP 1 INTRODUCTION	The teacher reviews the previous lesson on entrepreneurship skills	Students pay attention
STEP 2 EXPLANATION	She explains the meaning of money management and states its importance	Students pay attention and participates
STEP 3 DEMONSTRATION	She highlights the steps in money management and develops a budget around a given sum of money for a family	Students pay attention and participate
STEP 4 NOTE TAKING	The teacher writes a summarized note on the board	The students copy the note in their books

 

NOTE

MONEY MANAGEMENT

Among all the resources that are available to the family, the most important one is money. Money plays an important role in the life of man as an instrument through which he can satisfy his physical, material and mental needs. The income and expenditure pattern of the family decides the family’s standard of living and its place in the society.

 

Concept of Income

Income is the inflow of money, goods and services. Family income is one of the concept of income. It is defined as money or purchasing power earned by family members during a specific period of time and goods and services received or created in that time by the family eg. goods like vegetables from kitchen garden, services like doing household chores, teaching children etc.

Family income can be classified as: 

1. Money income

Money income is the cash available to a family from any source, over a period of time. The period can be daily, weekly, monthly or yearly. It is obtained in the form of a currency, bank draft or cheques.

Money income is tangible and is used for purchasing goods and services for the family. The sources of money income are given below.

Sources of money income

1. Salary 
2. Rent 
3. Bonus 
4. Profits
5. Wages 
6. Cash gifts
7. Dividends from shares
8. Interest from banks
9. Pension 
10. Investments
11. Lotteries

 

2. Real income

 Real income is the stream of goods and services available to a family over a period of time. Real income is derived from properties and possessions owned by a family, skills, efforts and abilities of the family members and also from com-munity facilities. These goods and ser-vices may be available to a family either directly through direct contribution of family members or by community facilities or indirectly when some medium of exchange, usually money is involved.

 

3. Psychic income:

 It is that flow of satisfaction that arises out of everyday experiences, derived largely from use of money and real income. It is intangible, subjective and is the most important income in terms of quality of living. Psychic income depends on the skills of family members in utiliz-ing their money and commodities judi-ciously. Satisfaction derived out of flow-ers obtained from the plants at home is an example for psychic income. 

 

Factors Affecting Income of a Family

Several factors affect income generation such as:

1. Skills and talents: If a person hastailoring skills, they can start a boutique, while a knowledgeable home-maker can conduct bakery classes and generate income.
2. Time and energy: A person withtime and adequate energy would be able to supplement his income by doing additional work.
3. Interest in job: A higher interest inthe job increases efficiency which in turn helps in career advancement through promotions and results in a higher salary.
4. Location of home: Living in aremote area may lead to lesser job opportunities as compared to cities where there are more job opportunities.
5. Investments/assets: The more aperson invests, the more interest can be earned. Other assets like property/ land also help in generating income through rent.

 

EXPENDITURE AND BUDGET MANAGEMENT 

Happiness of the family is secured by income use or expenditure. The outflow of money is called expenditure. After earning money, a family spends it on their various needs, basic necessities such as food, clothing and shelter. After their needs are fulfilled, the family desires to have comforts and luxuries, which makes the family members more comfort-able. All these expenses are referred to as expenditure. Expenditure provides the satisfaction of life for the members of the family.

 

Factors Affecting Expenditure of a Family

1. Income: In low-income groups, a majorportion of income is spent on food whereas in high income groups only %50 of their money is spent on food.
2. Family size: Expenses on food, clothing,and education is more in larger families as compared to small sized families.
3. Family composition: In the expandingstage of the family more money is spent on education and clothes while in the contracting stage, more expenses are incurred on medicines.
4. Family status: Influenced by the socialcircles they move in, a considerable amount of cash may be spent by some families on, maintaining a number of cars, designer clothes, entertainment, luxury items.
5. Type of family: In a joint family, moneyis saved on rent and childcare.
6. Family values: Some people give morevalue to education and prefer spending more on books. Those giving more importance to religion spend more on religious activities.
7. Location: There is less expense in smalltowns as compared to that in cities. If the school or office is nearby, less money is spent on transport.
8. Skill, knowledge and an interest to save: A homemaker with her knowledge,skill and interest in culinary arts can prepare exotic dishes at home and thus reduce her expenditure.
9. Access  to  community  facilities:

Community facilities help save expenses. A person using a library need not spend money on buying books.

 

BUDGETING

The common planning device for the use of money is the budget. It is a care-fully prepared spending plan based on the actual family income. It is a plan based on previous experience, present needs and future expectations. A budget is always prepared for a fixed period of time gen-erally for a month. Budget is a guide to realistic spending aimed at avoiding over expenditure.

 

Importance of budgeting

1. Budget acts as an intelligent guide to spending.
2. It enables a family to have an overall view of their income.
3. Budgeting facilitates adjusting irregular income to regular expenditure.
4. Budgeting helps people to discuss their needs and set their own priorities on them.
5. It helps one to cut unnecessary expenditure.
6. It helps one to be free from debts.
7. It helps one to live within one’s income.
8. It encourages conscious decision making which may help in including long term goals in the budget.
9. It relieves the family members from worries of future.
10. It forces one to decide what one wants most out of life.
11. It provides for future saving.

 

Its success depends upon its being simple, realistic, flexible and suited to the family or individual for whom it is made.

 

The List of Budget Items

It is necessary to list the chief budget items to make sure that each item is attended to in the expenditure plan while portioning the income. Each family may have their own way of listing the items.

 

The chief budget items include: 

i. Food

ii. Clothing

iii.   Housing

iv. Education

v. Transport

vi. Personal Expenses (Sundries)

vii.   Household Expenses

viii.   Savings

 A SIMPLE BUDGET OF 70,000NAIRA FOR A MONTH

i. Food-21,000

ii. Clothing (repairs since clothes aren’t repaired monthly)- 1400

iii.   Housing (This is spread over 12 months)-3500

iv. Education (This is spread over four months)- 14,000

v. Transport- 10,000

vi. Personal Expenses (Sundries)- 3,100

vii.   Household Expenses-10,000

viii.   Savings- 7,000

 

 

EVALUATION:    1. Define money management

2. State the importance of money management
3. What are the steps in money management?
4. Develop a budget for a home with the sum of 100,000 naira

CLASSWORK: As in evaluation

CONCLUSION: The teacher commends the students positively