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Grade 7 EMS Term 2 Lesson 3/5

Financial literacy: income and expenses
 BUDGET

● Personal income and personal

expenses Grade 7 ems Term 2 Lesson 3 of 6
Financial literacy: income and expenses
INCOME AND EXPENSES

● PERSONAL INCOME AND

EXPENSES

● PERSONAL INCOME: Money

that a person earns and uses
in his/her daily life
● PERSONAL EXPENSES: All
the costs you incur in your
daily life or what it costs to
you to live your life
PERSONAL INCOME
EXAMPLES OF PERSONAL INCOME

● Wages or Salaries (money for

work done)
● Interest received (money that
you receive for investments
● Rent income (money receive
for e.g. renting out your house)
● Government grants
PERSONAL EXPENSES
EXAMPLES OF PERSONAL EXPENSES:
● Accomodation
● Utilities
● Food
● Travel expenses
● Clothing
● Medical expenses
● Premiums for home, motorcar and
● life insurance.
● Entertainment
● Interest on debt
 PERSONAL STATEMENT OF
NET WORTH

IT IS A LIST OF ALL YOUR

PERSONAL ASSETS AND
LIABILITIES
NET WORTH: Your
financial value at any
given point
PERSONAL ASSETS PERSONAL LIABILITIES

Cash Loans

Investments Credit Cards

Insurance Cash Value Personal Debts

Real Estate Currently Monthly Bills

Personal Property Real Estate Mortgages

Loans Receivable Unpaid Taxes

Automobiles Automobiles Loans

Total assets - Total Liabilities = Nett Worth

PERSONAL STATEMENT
OF NET WORTH

● Net Worth = Total assets – Total

Liabilities
● Expenses decreases net worth
● Income increases net worth
● Surplus = Assets > Liabilities
● Deficit/Shortage = Liabilities> Assets
PERSONAL STATEMENT OF NET WORTH
STEPS TO COMPILE A PERSONAL STATEMENT OF NET WORTH
Step 1: Get your records
together
Step 2: Then make a list
and add up the total
assets
Step 3: Then make a list
and add up the total
liabilities
Step 4: Then subtract the liabilities from
the assets - remember our formula:

NET WORTH =
TOTAL ASSETS - TOTAL LIABILITIES
 Step 5: Determine
whether your net worth
has a surplus or a deficit.
 EXAMPLE: PERSONAL STATEMENT OF NET WORTH WAARDE

Use the following information to prepare a Statement of Net Worth for Buggs Bunny:

Mobile phone bill: R3 200, Loan from the bank R20 000, Savings account R4 700,
Credit card R1 500, Car R35 000, Clothing bill R650, Furniture R46 500
EXAMPLE: PERSONAL STATEMENTOF NET WORTH
ASSETS

LIABILITIES

NET WORTH
EXAMPLE: PERSONAL STATEMENT OF NET WORTH
BATES
Selfoon 3200
Spaarrekening 4700
Motor 35000
Meubels 46500
TOTAL ASSETS 89400

LASTE
Lening by die bank 20000
Kredietkaart 1500
650
TOTAL LIABILITIES 22150
NET WORTH 67250
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access the self-marking
assessment for lesson 2
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