HARSH REALITY WELCOME TO THE CRUEL WORLD A team program career exploration project
overview The purpose of this project is to give you an idea of the fiscal realities of living on your own, of how far a paycheck will really stretch. In it you will learn how much taxes take out and what benefits like health insurance are worth. You will estimate the expenses involved in owning a car. You will look at the costs of both renting and owning homes. You will examine health care expenses. And you will estimate how much you will spend on all the others things like entertainment, recreation, food at home, dining out, travel, laundry, toiletries, clothing, furniture, and whatever else you might be squandering your money on. In the end, you will add it all up and see if your income will support your hoped-for lifestyle. As a starting point, you will figure out how much money you can reasonably expect to be earning at age thirty in the career field you are doing your internship in. For the purposes of this project, use currentday dollar values throughout the exercise. Estimating what salaries, rents, interest rates, etc. will be twelve years from now is a purely speculative exercise. Some of the assignments are far more time-consuming than others, and will necessitate more than a week to complete. Harsh Reality 4 (housing expenses), particularly, is time-consuming and cannot be done well the evening before it is due. And, finally, Harsh Realities 6 and 7 require parental reality checks. Welcome to the cruel world! ASSIGNMENTS AND DUE DATES Harsh Reality 1 Gross Pay and Benefits Wednesday, February 5 Harsh Reality 2 Take Home Pay (Taxes and Deductions) Wednesday, February 12 Harsh Reality 3 Transportation Costs Wednesday, February 26 Harsh Reality 4 Housing Expenses Wednesday, March 5 Harsh Reality 5 Health Care Expenses Wednesday, March 12 Harsh Reality 6 Miscellaneous Expenses Wednesday, March 19 Harsh Reality 7 Putting It All Together Wednesday, April 23 Harsh Reality Oral Presentation Wednesday-Friday, May 8-10
Name: HARSH REALITY 1 GROSS PAY AND BENEFITS Due Wednesday, February 5 Determine the annual pay you can reasonably expect to make in your career field by the age of 30. Annual pay: What was your source for this information? List the benefits (such as health, dental, disability, or life insurance, retirement benefits, sick leave, or paid vacation) you can reasonably expect to get with this job: BENEFIT VALUE (in dollars) What was your source for this information?
Name: HARSH REALITY 2 TAKE HOME PAY (TAXES AND DEDUCTIONS) Due Wednesday, February 12 JOB TITLE: Monthly Gross Pay Federal Withholding Social Security Medicare California Withholding California State Disability Insurance NET PAY INSTRUCTIONS: 1. On the Internet, go to http://www.paycheckcity.com /calculator/netpay/us/california/calculator.html. A copy of the Paycheck Calculator page is on the back. 2. Make sure that the tax year is 2011 and the state is California. 3. Gross Pay: Put in your gross pay. Be sure that the box to the right corresponds with your figure. 4. Gross Salary YTD: Leave it blank. 5. Pay Frequency: Monthly 6. Federal Filing Status: Single or married, what s it going to be? 7. # of Federal Allowances: 1 if you are single, 2 if you are married, 1 for each child 8. Additional Fed. Withholding: Leave it blank. 9. Round Federal Withhlding: No 10. State Filing Status: Same as Federal above. 11. State Allowences: Same as Federal above. 12. State Additional Allowances: Leave blank. 13. CA SDI/VDI: Yes. 14. Additional State Withholding: Leave blank. 15. Voluntary Deduction Section: Use 0 voluntary deductions. 16. Click the calculate button, print a copy of the page, copy the information to this page, and attach your printout to this page.
Name: HARSH REALITY 3 TRANSPORTATION COSTS Due Wednesday, February 26 For this assignment you are going to figure out how you are going to get yourself around and what it s going to cost. Are you going to get an expensive new car? An old clunker? A gas guzzler? A fuel-efficient hybrid? Are you going to buy or lease? Or will you get a motorcycle? Or bike? Or will you just use public transit? Or a combination of the preceding? You will have to determine all the costs of maintaining a car or motorcycle (assuming you get one). That will include monthly payments (purchase or lease), insurance, gas, maintenance, tolls, parking, etc. If you don t get a car or motorcycle, you will have to determine the monthly costs of public transportation and/or maintaining a bicycle. Helpful websites are edmunds.com and mpgbuddy.com. Year, make and model of vehicle: Sticker price: Down payment: Loan: Show how will you save this money MONTHLY TRANSPORTATION EXPENSES: Car / Motorcycle Payment Insurance Maintenance Gas / Oil License and Registration Fees Tolls Public Transportation Bicycle Expenses ON THE BACK SIDE, CITE ALL YOUR SOURCES FOR THE ABOVE INFORMATION
SOURCES (and calculation formulae and explanations): Sticker price: Monthly payment: Maintenance estimate: Gas/Oil estimate: Insurance estimate: License and registration fees: Tolls: Public transportation: Bicycle expenses:
Name: HARSH REALITY 4 HOUSING EXPENSES Due Wednesday, March 5 In this assignment, you are going to estimate your monthly housing expenses. This is a two-part assignment: you will have to determine the monthly costs of both renting and owning. For the rental, you will have to find a place either in an ad in a newspaper or on the Internet. You will also have to estimate your utility costs (gas and electricity, garbage, phone, cable TV, and Internet access). Buying a home is more complicated. You will have to find a place. Then, you will have to figure out what your down payment is (as well as where you will get it from (personal savings - prove how you ve saved this money and 2nd mortgage). You will have to determine your mortgage payments (1st and 2nd), taxes, insurance, upkeep, and utilities. A really helpful website is http://www.homefair.com. It has nationwide home and rental listings, calculators to figure out mortgage payments and what price home you can afford based on your income, and a wealth of other information. You must staple to this sheet all of the information you gather: ads from papers or printouts from web pages (including calculation pages) and highlight applicable amounts. RENT: Address (street address, city, state): Description of rental unit: Description of neighborhood: Living arrangements (shared or solo): Gas and electricity Garbage Phone - cell and home Netflix/Apple TV/etc. C. H. Cable TV check one: o basic o premium Internet access MONTHLY HOUSING EXPENSES
PURCHASE: Before you begin house hunting, go on the Internet to homefair.com and use the home affordability calculator to determine what you can afford given the amount of money you expect to be earning. Print out and staple the web page with your calculation to this sheet. Location of home: Description of home: Price of home: Down payment (20% of home price - indicate both the amount and source): Mortgage (price of home minus down payment): First mortgage (5.5% fixed rate for 30 years) Second mortgage (4.5% fixed rate for 10 years) Property taxes Insurance Upkeep and improvements Furnishings* Gas and electricity Water Garbage Cable TV check one: o basic o premium Internet access MONTHLY HOUSING EXPENSES *To calculate furnishings expenses, estimate the total cost of furniture for the whole house, add 50% (that s because you re putting it on a credit card), and then divide by 60. That will be the monthly cost you put in the box above. Do the calculation below.
Name: HARSH REALITY 5 HEALTH CARE EXPENSES Due Wednesday, March 12 In this assignment, you will estimate your monthly health care expenses. Your best sources are the Internet (for health insurance payments) and your parents (for out-of-pocket expenses). HEALTH INSURANCE Get a quote from the Internet and attach a printout of the quote to this page. Name of insurance provider: Monthly premium: COVERAGE Hospitalization Office Visits Precription Medications Physical Therapy NO YES LIMITATION OR PERCENTAGE DENTAL INSURANCE Get a quote from the Internet and attach a printout of the quote to this page. Name of insurance provider: Monthly premium: ESTIMATED OUT-OF-POCKET HEALTHCARE EXPENSES Estimated monthly expenses: Name of Source: If the source was one of your parents, get him or her to sign here:
Name: HARSH REALITY 6 MONTHLY MISCELLANEOUS EXPENSES Due Wednesday, March 19 This is the most detailed of the expenses assignments. There are a lot of little boxes here that can be filled in. Use them! Entertainment Movies, video rentals, concerts, plays, ball games, CD s, video games, etc. Recreation Surfing, backpacking, snowboarding, tennis, gym & club fees, bikes, motorcycles, etc. Travel Airfare, gas, lodging, meals, fees, etc. Food Check with your mom on this Laundry and Dry Cleaning Ditto Toiletries Make-up, tooth paste, shampoo, toilet paper, etc. Clothing Sorry, mom s not paying anymore. Will your job require clothes you wouldn t normally purchase? Unhealthy Substances A most excellent place to save money. Dining Out Not just fancy restaurants; Starbucks, Jamba Juice, and In n Out count, too Stuff All the everything else stuff you buy: books, magazines, things you don t need, things you do Miscellaneous Everything from parking tickets to haircuts ENTERTAINMENT RECREATION FOOD AT HOME
DINING OUT Fine Dining Snacks Coffee Shops TRAVEL LAUNDRY & DRY CLEANING TOILETRIES CLOTHING UNHEALTHY SUBSTANCES Tobacco products Alcohol Illegal drugs STUFF MISCELLANEOUS College loan payments MONTHLY MISCELLANEOUS EXPENSES PARENTAL REALITY CHECK Parent s signature Date
Name: HARSH REALITY 7 PUTTING IT ALL TOGETHER Due Wednesday, April 23 From your previous Harsh Reality assignments, list the following: Transportation expenses (from Harsh Reality 3) Housing expenses (from Harsh Reality 4)--you can choose between renting or owning Healthcare expenses (from Harsh Reality 5) Miscellaneous expenses (from Harsh Reality 6) Net take-home pay (from Harsh Reality 2) Total left over for savings or emergency expenses (subtract total expenses from net take-home pay) If your expenses exceeded your income, you will have to reduce your expenses so that you can live within the limits of your income. Go over your previous worksheets to find any expenses that can be reduced or eliminated. List them below and on the next page. ITEM PREVIOUS AMOUNT NEW AMOUNT SAVINGS
ITEM PREVIOUS AMOUNT NEW AMOUNT SAVINGS SAVINGS REFLECTION: What was the most surprising aspect of planning your budget? What were the most difficult things to give up? What do you think are the most important things you learned doing this exercise? PARENTAL REALITY CHECK Parent s signature Date
HARSH REALITY presentation HARSH REALITY ORAL PRESENTATION (Wednesday, Thursday & Friday, May 8-10) In a presentation of no longer than ten minutes, you will describe the material aspects of the life you have imagined for yourself in this project. All the assignments should be covered and your findings described. Graphic displays are a must. Keep the ten minute limit in mind; you will not be allowed to exceed it. SCHEDULE Wednesday, May 8 9:20-9:30 Eric Bryan 9:30-9:40 Mikayla Dinsdale 9:40-9:50 Shayna Lee 9:50-10:00 Matt Finkle 10:00-10:10 Noel Pond-Danchick 10:10-10:20 Ember Mulcahy 10:20-10:30 Austin Myers 10:30-10:40 April Denny Thursday, May 9 10:20-10:30 Gabri Aparicio 10:30-10:40 Camden Dowd 10:40-10:50 Emma Newman 10:50-11:00 Elsa Ledesma 11:00-11:10 Colby D Onofrio 11:10-11:20 Clay Pelo 11:20-11:30 Kate Leubkeman 11:30-11:40 Michelle Kunst Friday, May 10 10:20-10:30 Kayla Bronzo 10:30-10:40 Poul Myrner 10:40-10:50 Alicia Leggett 10:50-11:00 Liam Salcuni 11:00-11:10 Bridget Lowrey 11:10-11:20 Mimi Ginzbrg 11:20-11:30 Rikcy Olivares 11:30-11:40 Maggie Maguire