A 4th Grader Makes a Budget in 1991

When I moved out of my parents' house they gave me the archive of all mementos they saved from my schooling - report cards, essays, art, etc. I recently went through it all and the result was super depressing. Let me tell you, I won awards, I got my picture taken for the newspaper, I got straight A's much of the time and it's all terrible. Whatever the assignment was, whatever the result was, reading it now is shockingly bad.

I remember in 2nd Grade, everyone complimented me on my stories. I was a star writer when it came to fiction in 2nd Grade. That's my memory. Look at the actual work and it's "I like dogs. Dogs are cute. Yay dogs!" Well, 2nd Grade is rudimentary by definition, but I was fairly sophisticated in High School at least, right? No, my high school papers are: "I'm fond of dogs. Dogs are meticulous. The future looks bright for dogs." printed on the computer, with a cover page and "works cited" enclosed in a plastic sleeve thing. Oof.

But anyway, within the pile of junk I did find one assignment which I found interesting enough to be worth sharing. In 4th Grade, we had an assignment where we planned a possible life from a current newspaper. First we were told to go through Want Ads and pick a job. Then we had to look through the House/Apartment listings to pick somewhere to live. Then we were told to look through the Car listings for a car. The purpose of the exercise was to do complex math with multiple digit numbers in order to arrive at a personal budget but its genius side-effect is the way it gets kids thinking about the value of a dollar, planting seeds in their mind about the importance of planning the rest of their lives. 

Beyond that, the nature of inflation gives it some humor these days. So here we go, here's how it went:

Day 1

You have just been graduated from  Temple  . You now need to find a job, a place to live, a car to drive. Let's begin:

1. Do you have a High School Diploma or a College Diploma?

College Diploma

2. Have you had any part-time jobs during the Summer in which you were trained in any specific skill?

No.

3. What qualifications do you have which would be of interest to an employer?

Masters Science Degree, Social Services Degree

[Editor's Note: I know I changed my mind about my job, so perhaps I meant to cross out the Social Services.]

4. Using the above qualifications, go through the Want Ads and find a job.

5. 

Job: Pharmaceutical. [Editor's note: In my memory, I remember my choice was to become a Reporter for the newspaper. I think I found it didn't pay enough and went back and switched to "pharmaceutical" based solely only on salary. I have no memory of this. I have no idea what the specific job for "pharmaceutical" was.]

Salary: $33,000 [per year]

Subtract 20% for taxes: $26,400.00

6. Subtract $20 per week if your employer does not pay 100% of your health benefits.

$25,360.00

7. You have reached an approximate Net Salary. Congratulations!

8. If you finish this before the end of class, start looking for an apartment. Your parents will give you $500 toward the Escrow Account.

Rent=$325 [per month]

Net Monthly=$1788.00 [Net Salary]

Net Weekly=$653.00 [Net Salary]

Day 2

Congratulations! You have found your apartment. You now need to calculate your current spending money per month after taxes, insurance, and rent.

1. You need to find transportation. Let's look for a  1980 Fiat Convertible .

[I remember my dad laughed at choosing to buy a Fiat, he said Fiats were notoriously unreliable. He said, "'Fiat' stands for 'Fix It Alot.'" I thought, "I'm 11 years old."]

[Car Sale Price=$1538.00]

2. Plan on 10% down. How many weeks must you wait?

$153.00 - 0 [Weeks]

Figure out the cost of the car with 6% sales tax for Pennsylvania and miscellaneous costs. Add this to the cost of the car after you have figured out one tenth of its cost. Tax money must be paid up front.

Tax=$92.00

Car Cost with Sales Tax: $1630.00

$1538-$153.00 = $1385.00

3. Let's figure out simplistic loan payments. (It will cost more than this actually) Take the cost of the car with the down payment subtracted. Multiply that amount by 12%. (Don't tell me you can get it for less.) [I'm 11 years old] Add that amount to the cost of the car less the down payment. Figure out whether you want to pay for it in 36 months of 48 months. (You need to divide by these amounts to do this.) What is your monthly payment?

$1385.00*.12 = $166.00

$1385.00+$166.00 = $1451.00

$1451.00 / 36 months = $40.00 [monthly car payment]

[Editor's Note: The wording of that question looks insane to me now.]

4. With what you have left over you need to buy car insurance. Subtract two hundred dollars a month if you bought a new car, one hundred fifty if you bought a used car.

$1863.00-$40.00-$150.00= $1673.00 [Monthly salary remaining]

5. Smile you can now worry about gas for the car's tummy and food for yours. That's part three. Start thinking about how far you live from your job and how much you like hotdogs.

Gas costs $1.05 per gallon.

Distance from job to house (Willow Grove [PA] to Springfield [NJ]) - 40 miles.

Mileage per month = 2,600.

Gas cost per month=$91

[Editor's Note: I see no way to make these calculation make any sense whatsoever but it's what I have written on the paper.]

Summary - June 4, 1991

1) Gross Salary: $33,000 [per year]

2) Less taxes: $26,400.00

3) Less health insurance: $25,360.00

4) Net Salary: $25,360

5) Fiat Car costs: $1,538

6) Car cost with sales tax: $1,630

7) Financing costs: $166.00 [per month]

8) Total cost of car: $3,596.00

9) Salary after car costs: $1582

10) Other expenses: [per month?!]

Food: $160

Toiletries: $30

Clothing: $200

Entertainment: $125

Furniture: included with apartment $200.

[I would love to know where these numbers come from. How does one spend $200 in 1991 dollars on clothing every month? I'm spending more on clothes than on my car payments. I see no corresponding calculations so maybe these were supplied by the teacher(?)]

11) What is left: $12,983.00 [per year]

Net salary: $25,360

Yearly car costs: $1,198

Yearly housing costs: $2,599

Yearly misc. costs: $8,580

[In the end, I didn't go to Temple, didn't get a Master's Degree or a Social Science Degree, didn't buy a Fiat, never lived in an apartment, didn't get a Pharmaceutical job, never lived in Willow Grove or worked in New Jersey.

Parts of the exercise are duplicated with different numbers from different calculations. I tried to merge the two into a "correct" version to make everything easier to follow but anomalies persist. I got an A+ on this assignment but looking at it now, the math clearly has errors. You see how every school accomplishment is hollow? I'm depressed again. Time to buy more clothes.]