# Math - Financial Plan

by Tara
(MS)

analyze a financial plan

Develop a typical budget.

Prepare a budget for monthly living expenses, mortgage payments, and interest expenses.

Show the details of all calculations.

1. Select the first three letters of your last name. Each letter has a numerical place value in the alphabet. For example, D is 4, L is 12, and Z is 26. Add the three place values together. For example, Thomas would yield THO, which is 20+8+15= 43

2. Multiply your sum by 1500. This is your yearly income for Week Four Discussion 1.

3. Please use the following monthly expenses: Car payment = \$283.15, Car insurance = \$72, Utilities (includes water and power) = \$242.77, Internet = \$32, and Cell Phone = \$79.95.

4. You also have a yearly educational bill of \$7980 which includes textbooks and classes.

6. What percent of your monthly income is the car payment?

7. Subtract the sum of your monthly expenses. Use this value to calculate what percent of your income is now available to spend for food, clothing, and your rent or mortgage.

8. Use the plan at the bottom of page 454, “Mathematics in Our World Revisited,” to calculate the monthly mortgage payment established by your monthly income.

9. Assume you can afford a down payment equal to 25% of your yearly income. What is the total purchase price can you afford for a home? Would this amount allow you to purchase a home in the area where you live?

The first three letters of my last name is THO

### Comments for Math - Financial Plan

 Jul 11, 2011 Financial Plan by: Staff ------------------------------------------------------- Part II Monthly expenses: Car payment = \$283.15 per month Car insurance = \$72 per month Utilities (includes water and power) = \$242.77 per month Internet = \$32 per month Cell Phone = \$79.95 per month Yearly educational bill (includes textbooks and classes): \$7980 \$7980/12 = \$665 per month Calculate your monthly income. (Yearly income)/(12 months) = \$64,500/(12 months) = \$5,375 per month What percent of your monthly income is the car payment? [(Monthly car payment)/(Monthly income)] * 100 = % car payment (\$283.15/\$5,375)*100 = 5.26791% The monthly car payment is 5.26791% of the monthly income Subtract the sum of your monthly expenses. \$5,375 per month, monthly income -\$283.15 per month, Car payment -\$72 per month, Car insurance -\$242.77 per month, Utilities (includes water and power) -\$32 per month, Internet -\$79.95 per month, Cell Phone -------------------------------------- \$4665.13 per month (monthly income after monthly expenses, without educational expenses) If educational expenses are included: \$4665.13 per month -\$665 per month, educational expenses -------------------------------------- \$4000.13 per month (monthly income after monthly expenses, including educational expenses) --------- Calculate what percent of your income is now available to spend for food, clothing, and your rent or mortgage. [(Monthly income after payments)/(Monthly income)] * 100 = % available Without including educational expenses (\$4665.13 /\$5,375)*100 = 86.7931% Available income is 86.7931% of the monthly income. Including educational expenses (\$4000.13 /\$5,375)*100 = 72.5026% Available income is 74.421% of the monthly income. Assume you can afford a down payment equal to 25% of your yearly income. \$64,500 * .25 = \$16,125 down payment What is the total purchase price you can you afford for a home? 28% of gross monthly income = .28*\$5,375 = \$1,505 7.70x = \$1,505 X = \$1,505/7.70 = 195.455 195.455 *1000 = \$195,455 \$195,455 + \$16,125 = \$211,580 Can purchase a home costing about \$211,580 Would this amount allow you to purchase a home in the area where you live? Yes According to zillow.com, there are over 200 homes currently for sale in Lake Charles, LA 70601. Many are listed for sale at less than \$211,580. http://www.zillow.com/homes/70601_rb/#/homes/for_sale/Bridge-Junction-Lake-Charles-LA-70601/88699_rid/pricea_sort/30.30063,-93.070018,30.183177,-93.385532_rect/11_zm/1_fr/ Thanks for writing. Staff www.solving-math-problems.com