1.4.3 Increase your financial literacy

This online activity is designed to increase your financial literacy level
through a single practical activity. After doing the activity you can expect to be able
to draw up a household budget in a (more) responsible way.

Go through Marie-Elise’ spending list and break them into two groups: essential and non-essential. Identify ways of moving items from the essential list into the non-essential list. Can you identify additional categories of expense not covered by this list or which might be added to the list in the future?

Attempt to answer questions 2 & 3. In so doing, can you identify ways of moving items from the essential list into the non-essential list?

Share your answers with your peers or with a fellow parent, preferably via the blog/ comments section set up for this course.

Questions

  1. Marie-Elise overspends each month and she is concerned that her debts are increasing
    significantly.
  2. Suggest four changes that Marie-Elise could make to her essential spending to help to
    improve his financial situation.
  3. Suggest four changes that Marie-Elise could make to her non-essential spending to help to
    improve her financial situation.
  4. Explain how improvements in Marie-Elise’s financial situation would benefit her immediately
    and her long-term financial planning.

Marie- Elise’s Spending List

  • Marie-Elise is 25 years old and lives alone in a two-bedroomed house
  • She earns a monthly salary working in a full-time job.
  • Her typical monthly spending includes:
  • Rent for her house
  • Council Tax
  • Gas & electricity
  • Cigarettes
  • Designer label clothes
  • Food
  • Fuel for her car, mainly to get to work and back
  • Cafes, pubs & clubs
  • Savings for foreign holidays
  • Bank overdraft charge