Republic of the Philippines

NUEVA VIZCAYA STATE UNIVERSITY

Bayombong, Nueva Vizcaya
INSTRUCTIONAL MODULE
IM No.: IM-BTLED3-1STSEM-2020-2021

College: Teacher Education

Campus : Bayombong Campus

DEGREE BTLE COURSE NO. HE 4

PROGRAM
SPECIALIZATION HE COURSE TITLE Consumer Education

YEAR LEVEL 3 TIME FRAME 9hrs WKNO. 6-8 IM NO. 3

I. UNIT TITLE/CHAPTER TITLE: Money Management

II. LESSON TITLE : Management of Personal Resources

III. LESSON OVERVIEW

Making a budget is the most important thing you can do to manage your
money, but many people are reluctant to take this beneficial step. You may
associate budgeting with restrictions and a lot of hassle and headaches. Or you
may feel like you are too poor to budget. However, budgeting is essential
because it can help you save money instead of overspending and enables you to
make the most of every peso.

IV. DESIRED LEARNING OUTCOMES

At the end of the lesson, the students should be able to:

a. Discuss how budgeting, saving, and spending money are related
b. explain the importance of saving money
c. give and discuss the importance of budget and records in spending and saving
money

V. LESSON CONTENT

Everyone says you should have a budget, and that’s certainly good advice. But if
you’ve never had a budget, you may not be entirely sure what it is and what it’s
designed to accomplish.

What is a Budget?

Part of the problem with budgeting is that the word “budget” itself has a very
clinical meaning. The accounting definition of a budget is both dry and impersonal.

“A budget is an estimation of revenue and expense over a specified future

period of time and is usually compiled and re-evaluated on a periodic basis. Budgets
can be made for a person, a family, a group of people, a business, a government, a
country, a multinational organization or just about anything else that makes and spends
money. At companies and organizations, a budget is an internal tool used by
management and is often not required for reporting by external parties.”

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 Republic of the Philippines
NUEVA VIZCAYA STATE UNIVERSITY
Bayombong, Nueva Vizcaya
INSTRUCTIONAL MODULE
IM No.: IM-BTLED3-1STSEM-2020-2021

How it can apply to you personally?

 Take Control of Your Finances. At its core, budgeting is about taking control of

your money. Having a budget is a critical part of avoiding living in that financial
state. A budget is simply a strategy you put in place to make sure you spend less
than you earn.

Purpose of a Budget

The main purpose of a budget is to gain the upper hand on your financial
situation. There are all kinds of causes for stress, but one of the biggest is financial. The
problem is that it’s relentless. It’s not just that you fall behind in one month, but rather
that it’s a constant struggle every month. That can wear anyone down.

Start the Budgeting Process

In a real way, a budget is like taking a financial timeout. You’ll start the process
by doing an in-depth analysis of your current financial behavior. Mostly, that’s about
figuring out exactly how you spend the money you do have. And once you do, you’ll be
in a better position to evaluate how you can be more efficient with your finances.

Budgeting is “creating margin in your finances.” Like the extra space that
surrounds the text on the page of a book, margin is the extra money in your budget. If
you don’t have a budget, you probably don’t have any financial margin. The purpose of
a budget is to provide exactly that. Until you implement a budget of your own, it’s highly
unlikely you’ll ever make any progress on the financial side of your life.

Most people focus on the negative side of budgeting, but that’s approaching it
entirely from the wrong angle.

The Negatives of Budgeting

 Changing your finances, which is always uncomfortable. And naturally, changes
in your finances will inevitably lead to changes in your lifestyle.
 Learning to live on less than you earn. That’s a difficult concept if you’ve never
done it before.
 Adopting the discipline to say “no” to yourself and your family when you’re
working to justify spending money on a “want” that you’re trying to convert into a
“need.”
 The initial sense of a loss of freedom when first implementing your budget.
 Learning to live without those little goodies and indulgences you’ve been treating
yourself to over the years.
 If you focus on the negatives, you may never start budgeting. But that’s why it’s
mission-critical to focus instead on the positives.

The Advantages of Budgeting

 Once you implement a budget, you’ll begin to develop a sense of control over
your finances that you’ve never known. It can be incredibly empowering.
 You’ll begin building savings, which will represent tangible evidence of the
greater control you’re gaining over your finances.
 If you were in debt when you began budgeting, you’ll begin to see your balances
decline – along with your monthly payments on credit cards. You’ll start to realize
you can get out of debt.

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 Republic of the Philippines
NUEVA VIZCAYA STATE UNIVERSITY
Bayombong, Nueva Vizcaya
INSTRUCTIONAL MODULE
IM No.: IM-BTLED3-1STSEM-2020-2021

 When your savings reach a comfortable level, and your debts are well on their
way to being paid off, you may begin investing. That’s when you’ll begin creating
wealth for the future.
 You’ll come to realize that your budget, as painful as it might be, is creating more
options in your life.
 Your stress level will decline, enabling you to sleep better at night and to feel
better about yourself.
 As your financial situation begins to improve, you’ll once again be able to indulge
yourself in some extras, only this time you’ll do it without guilt.
 If you’ve been struggling with starting a budget because of how bad it will feel,
change your focus, and think more about how good it will feel when you have it
up and running. In other words, focus on the benefits at the end, not the
struggles at the beginning.

Short of having a winning lottery ticket or a large inheritance, no one achieves

financial independence without an investment of time and effort. And trust me, financial
freedom is a worthy goal. But that will never happen until you get control over your
budget.

The Three Types of Budgets

There are more than three types of budgets, so many in fact that it’s probably
impossible to put a number on it. Virtually anyone who knows anything about finance
has published a book or an online course to give you their version of the ultimate
budget.
But in my experience, three types of budgets are the most effective and will work best
for most people.

50-20-30 Budget
The numbers, 50-20-30, represent percentages of your net income allocated to
general spending categories.

Those categories are as follows:

 50% of your after-tax income goes to necessary expenses, like housing, utilities,
food, minimum debt payments, insurance premiums, and the like.
 20% is allocated to savings and/or debt repayment. For debt payment, it
represents payments over and above the minimum required monthly payments.
The idea is to increase your payments to pay down your debts faster.
 30% goes to “wants.” These are the extras in life that you don’t need, but you buy
them because they make life more pleasant. This category includes vacations,
entertainment, concert tickets, sporting events, and going to the movies.

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 Republic of the Philippines
NUEVA VIZCAYA STATE UNIVERSITY
Bayombong, Nueva Vizcaya
INSTRUCTIONAL MODULE
IM No.: IM-BTLED3-1STSEM-2020-2021

The 50-
20-30 budget is its emphasis on the big picture. Most budgeting methods focus on the
details of budgeting, like the individual expense line items. With this method, personal
expenses aren’t as necessary. For example, the 30% allocation to wants you can spend
any way you choose. You can decide which pleasures you wish to pay for in life, without
having to go on the financial equivalent of a diet. There’s also a lot of flexibility in this
budget method. If you can’t fit your necessities neatly in 50% of your after-tax income,
you can move some of your allocations from your wants category.

Most like about the method is the emphasis on saving money. Most people try
to get by saving just 10% or so of their paychecks. That’s certainly a step in the right
direction, but in my own experience, you’ll need to save a lot more to build wealth. 20%
is the minimum in that direction.

The Envelope Method

Long ago and far away – when people typically paid their bills in cash – many
used this method as a standard budgeting procedure. It involved putting actual currency
into individual envelopes earmarked for each household expense. It’s conceivable you
could’ve had 15 to 20 cash bearing envelopes to match all of your expenses.
A few people still handle their finances that way, but the envelope method has
evolved in recent decades. Though far fewer people put cash in envelopes, the basic
methodology remains the same. You set up a budget in which each expense has an
“envelope” that you need to fill with sufficient funds to pay the expense it represents.
One of the advantages is that if you
go over budget in one expense
category, you can usually find
additional funds from another
expense that’s lower than
expected. And for what it’s worth,
you don’t need to set up a system
of physical envelopes anymore.
There are envelope budgeting
apps you can use to do it digitally.
The most prominent is an app
known as Mvelopes. It works by
“giving a purpose to each peso in

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 Republic of the Philippines
NUEVA VIZCAYA STATE UNIVERSITY
Bayombong, Nueva Vizcaya
INSTRUCTIONAL MODULE
IM No.: IM-BTLED3-1STSEM-2020-2021

your budget,” which is precisely what the paper envelope method does. It will enable
you to take an old school budgeting system and do it digitally.

Zero-Based Budget

Using the zero-based budget, if you manage your money correctly, your budget
will zero out every month. That’s because the method forces you to account for every
dollar in your budget. Every dollar must go toward a specific expense, or moved into
savings or put toward debt reduction.

The zero-based budget works on the assumption that any money in your budget
that doesn’t have a specific purpose is likely to disappear into excess spending. For this
reason, it tends to be more restrictive than other budget types. It may best be used if
you’ve had difficulty managing your finances in the past, and lack the discipline to
handle unallocated funds.

The Importance of Budgeting

Implementing a budget doesn’t have to be – and shouldn’t be – complicated and

painful. Sure, it will involve an element of sacrifice at the very beginning. But as each
month passes, it should get more comfortable. And as it does, you’ll begin to sense
greater control over your finances. That’s an important point by itself. The whole
purpose of implementing a budget is to make you the master of your money, rather than
letting your money control you. That’s a worthwhile goal even if you never plan to get
rich. But it will be even more critical if you do.

Financial independence is a goal well worth pursuing. It’s not merely about the
constant accumulation of more money, but rather one of having progressively greater
control over your life. Having a budget in place will help you move closer toward living
the life you’ve always dreamed of living.

The Importance of Saving Money

We save, basically, because we can't predict the future. Saving money can help
you become financially secure and provide a safety net in case of an emergency.

Here are a few reasons why we save:

 Emergency cushion - This could be any number of things: a new roof for your
house, out-of-pocket medical expenses, or sudden loss of income. You will need
money set aside for these emergencies to avoid going into debt to pay for your
necessities.
 Retirement – If you intend to retire someday, you will probably need savings
and/or investments to take the place of the income you'll no longer get from your
job.
 Average Life Expectancy – With more advances in medicine and public health,
people are now living longer and needing more money to get by.
 Volatility of Social Security – Social Security was never intended to be the
primary source of income and should be treated as a supplement to income.
 Education - The costs for private and public education are rising every year and
it's getting tougher to meet these demands.

Without money put away in savings and/or investments, you open yourself up to
other risks as well. For example, not having enough money to pay for emergency dental
care may force you into taking a loan that your savings might otherwise have covered.

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 Republic of the Philippines
NUEVA VIZCAYA STATE UNIVERSITY
Bayombong, Nueva Vizcaya
INSTRUCTIONAL MODULE
IM No.: IM-BTLED3-1STSEM-2020-2021

Tips for saving money:

 Save windfall income – Any unexpected money such as income tax return
money.
 Collect loose change and deposit it in the bank – Use a piggy bank and
deposit its contents when its full.
 Try frugality – Purchase cheaper off brand items and save money.
 Break a habit – Try doing one less thing you expensive venture a week and
apply that money to your savings.
 Save lunch money –Bring your lunch to work and invest in yourself.
 Have a “buy nothing week”.
 Compare costs of major items before purchasing anything – Do your due
diligence, shop around before making major purchases.
 Use coupons – Coupons are a great way to reduce living expenses.

VI. LEARNING ACTIVITIES

Rein In Your Wants!

Your task: As a student, there’s a good chance you’re not responsible for paying for all
of your own living expenses -- housing, groceries, etc. -- which means much of your
spending could be on “wants.” In this activity, you’ll assess your current spending, try
one recommended strategy for cutting your spending, and then develop your own plan
to see if it works any better. 

Part I: Initial Trial - Track your Spending

1. If you were to categorize each of your purchases (Ex: Food, entertainment,

transportation, etc), what are the main areas you spent money in?

2. How do you feel about the amount you spent? If you have a budget for yourself,
does this spending fit within that budget?

Part II: Suggested Intervention

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 Republic of the Philippines
NUEVA VIZCAYA STATE UNIVERSITY
Bayombong, Nueva Vizcaya
INSTRUCTIONAL MODULE
IM No.: IM-BTLED3-1STSEM-2020-2021

3. Did reflecting on how happy the purchase would make you change your spending
habits at all? Why or why not? 

4. Are there items you purchased that you assumed would make you happy, but in
retrospect did not?

VII. ASSIGNMENT

1. Many Filipinos struggle to live within their budget, why do you think budgeting is so
difficult for so many?

VIII. EVALUATION

IX. REFERENCES

InCharge Debt Solutions and the Federal Trade Commission. League of United
Latin American Citizen 1133 19th St, NW, Suite 1000, Washington, DC -833-6130

, G. 2020. Millennial Money, Llc. All Rights Reserved Millennial Money

Retrieved from https://millennialmoney.com/what-is-a-budget/

Retrieved from https://www.thebalance.com/reasons-to-budget-money-2385699

Retrieved from https://www.ngpf.org/curriculum/budgeting/activities/

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