Budgeting Basics

Year Level

Year 7 Mathematics (Victorian Curriculum aligned)

Duration

60 minutes

Class Size

10 students

---

Lesson Title

Budgeting Basics: What is a Budget?

Lesson Description

In this lesson, students will be introduced to the concept of budgeting. They will explore the components of a budget and understand why it is essential for managing personal and household finances. Through interactive activities, students will begin to create simple budgets and appreciate the importance of allocating income toward expenses, savings, and needs versus wants.

---

Victorian Curriculum Alignment

Content Descriptions:

• VCMMG163 (AC9M7N09): Use mathematical modelling to solve practical problems involving rational numbers and percentages, including financial contexts; formulate problems, choose representations and efficient calculation strategies, using digital tools as appropriate; interpret and communicate solutions in terms of the situation, justifying choices made about the representation.

• VCMMG160 (AC9M6N09): Use mathematical modelling to solve practical problems involving natural and rational numbers and percentages, including financial contexts; formulate the problems, choosing operations and efficient calculation strategies, and using digital tools where appropriate; interpret and communicate solutions in terms of the situation, justifying the choices made.

General Capabilities:

• Numeracy: understanding money, percentages, and budgeting.
• Critical and Creative Thinking: problem-solving financial scenarios.
• Ethical Understanding: discussing responsible money management.

---

Learning Objectives

By the end of this lesson, students will:

1. Define what a budget is and articulate why budgeting is important for managing money.
2. Identify and describe key components of a budget (income, expenses, savings).
3. Begin creating a simple budget for a hypothetical personal or family scenario.
4. Recognise the difference between needs and wants in the context of budgeting.
5. Use basic addition and subtraction of decimals (currency amounts) to calculate budgets.

---

Resources Needed

• Whiteboard and markers
• Budget worksheet template (printed for each student)
• Sample income and expense cards (for group activity)
• Calculators
• Projector or interactive whiteboard (optional)
• Personal finance scenario examples (prepared by teacher)

---

Lesson Plan

1. Introduction (10 minutes)

• Hook (5 mins): Ask students:
  “If you got $50 per week as pocket money, how would you spend it? What would you save for?”
  Discuss briefly to elicit ideas around managing money.

• Define Budget (5 mins): Present the definition of a budget:
  “A budget is a plan for how to spend and save money based on income and expenses.”
  Link this to everyday life and family finances.

2. Direct Teaching: Components of a Budget (10 minutes)

• Present the three main components of a budget:

  • Income (money you receive)
  • Expenses (money you spend)
  • Savings (money set aside for later)

• Discuss examples of each (e.g., income: pocket money, gifts; expenses: food, entertainment; savings: money for a new game).

• Introduce the concept of needs (essential expenses) vs wants (optional spending).

3. Group Activity: Budget Sorting Game (15 minutes)

• Divide the class into pairs or small groups.

• Provide each group with a set of income and expense cards (e.g., Weekly allowance $50, Mobile phone bill $15, Movie ticket $10, Savings for bicycle $20).

• Task: Students sort cards into income, needs, wants, and savings categories.

• Ask groups to create a sample weekly budget using cards — recording calculations of total income, total expenses, and savings.

4. Guided Practice: Creating a Simple Budget (15 minutes)

• Hand out budget worksheets with a template showing columns for Income, Expenses (Needs and Wants), Savings, and Balance.

• Lead students through filling out a worksheet based on a fictional scenario, e.g.,
  “You earn $70 a week. You need to pay $30 for school lunches and $10 for bus fare. You want to buy a game that costs $20.”

• Have students calculate total expenses, subtract from income, and decide how much can be saved.

• Encourage use of addition and subtraction skills with decimals to manage money calculations.

5. Class Discussion and Reflection (5 minutes)

• Invite several students to share their budgets with the class.

• Discuss the importance of making choices in budgeting and how savings help achieve goals.

• Reinforce key points: Budgets help you not run out of money and allow you to plan ahead.

---

Assessment

• Formative: Teacher observes group activity participation and checks completion of budget worksheet for accuracy of addition and subtraction of money amounts.

• Informal: Class discussion contributions show understanding of budgeting concepts and needs vs wants.

---

Differentiation

• Support: Provide additional examples and scaffolding for students needing extra help with decimals or financial concepts.

• Extension: Challenge advanced students to modify budgets with unexpected expenses or income changes and recalculate.

---

Reflection / Next Steps

• In the next lesson, students will learn about tracking expenses and income over time.

• Encourage students to try making a simple budget at home over a week to reflect on the lesson.

---

This lesson brings together practical financial literacy with aligned Victorian Curriculum content, engaging year 7 students in meaningful maths learning through real-world applications, preparing them for money management skills essential in everyday life.