The
Process |
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Find
a Job |
Find a part-time job
using on-line resources. Copy and paste a copy of the job you
have selected
into a Word document naming the internet or hard copy resource. Be
sure the job you have selected indicates a wage per hour. Some
potential resources (you are not limited to these) include: http://jobs.startribune.com/jobs/ and http://www.careerbuilder.com.
You may use other sites if you wish. Note: Most career sites will have features to help you narrow your search to part-time positions in the Mpls./St. Paul Metro area.
If you already have a part-time job. In Word, type of a job description and the hourly wage. |
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Determine
Monthly Income |
Assume you will work
20 hours per week, 4.3 weeks per month = 86 hours per month. In an Excel spreadsheet,
calculate
your monthly net pay. Assume 15% of your gross wage
will be deducted for federal tax and 8% for state tax. You should remember the percent deducted for FICA! |
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Use the format below add
titles and formatting as you find appropriate: |
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MONTHLY INCOME |
Hourly
Wage |
Hours
Worked |
Gross
Pay |
Fed.Tax
15% |
State Tax
8% |
FICA |
Net
Pay |
6.75% |
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On the same spreadsheet,below this table, create a new table to show how many months it will take
you to accumulate your downpayment of $2,000.00. (HINT: $2,000/net pay) |
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Locate
Potential Vehicles to Purchase |
Find three
vehicles that interest you with a purchase price of $15,000.00
or less.
Utilize the following resources: http://www.keepitlocal.com, http://www.carsoup.com,
http://www.autobytel.com, http://www.autoweb.com,
http://www.carsdirect.com. |
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Print the information about each of your three vehicles, or copy and paste the
information you find about into a new Word document.
Be sure to include the source for each vehicle with the information. (Car make, year, price, options,picture optional) |
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Do
Your Research |
Are you getting the best
deal? How do you determine if the seller is asking a fair price? Use
the following sites to determine the vehicle's value. Be sure you
thoroughly investigate the sites locating a base price and retail
and/or private party price by selecting your vehicle and adding
all the options and features you know about. The
following sites can provide a
wealth of information: http://www.kbb.com, http://www.edmunds.com ,
http:www.autoweb.com. |
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Now, either print your research for each vehicle or add the
vehicle value information to the Word documents you already created.
Be sure the asking price and the value you just located is labled clearly
and completely along with the source for your research.. |
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Narrow
your Options |
Create a new Word document titled "Vehicle Purchase Pros and Cons". Based on the information
you have found, list at least three pros and three cons for each vehicle. This is your opinion - what matters to you, the purchaser! |
Review your pros and
cons and eliminate one vehicle from your list of potential purchases.
In a paragraph below your "pro's and con's",
state which vehicle you eliminated and why. Also provide your reasons
for keeping the vehicles you did. |
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Calculate
Monthly Payment and Insurance |
For the two cars
remaining, use two Excel spreadsheets to document the MONTHLY cost
of financing
and insuring the these vehicles. See sample spreadsheet
below. |
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Total |
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TOTAL |
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Title |
Total |
Down- |
Financed |
Interest |
Monthly |
Mthly |
Mthly |
Mthly |
Price |
Tax |
Fee |
Cost |
Payment |
(cost-down) |
Rate |
Paymnt |
Tabs |
Insur |
Cost |
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Assume you will pay the
asking price, thus enter the seller's price as your price for the vehicles.
Sales tax in MN is 6.875%. |
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There is also a fee to transfer the title of the vehicle from one owner to another. Locate this cost on the following link (click on DVS home (top of page, then Fees, then Title Fee):
http://www.dps.state.mn.us/dvs/index.html
Remember the $2000.00 you saved? This is the downpayment for your vehicle so you do not have to borrow as much from the bank. So, the Total Financed on your spreadsheet is Total Cost (price + tax + title) - $2000. |
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Assume that you
will obtain a three-year loan for what you need to finance or borrow. (36 months) |
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Use the following
resources to find an average interest rate for your loan and
then use an on-line
loan calculator to determine a monthly payment. The following
sites will provide all the necessary information: http://www.bankrate.com/, http://www.autobytel.com,
or http://www.interest.com/ |
Use the following link to determine the registration (tab) fee. (Click on Division - Driver and Vehicle Services, Fees, Registration Tax)
You must first add the filing, technology and wheeling fees together. These are standard rates that everyone pays.
Then go to the section "Passenger Class Vehicle Registraiton Tax" and click on the "Base Value Guides for 2013" and retrieve the annual fee for your car based on the value and year.
Don't forget to add the filing,technology and wheeling fee to this amount.
This is an annual (yearly) amount, to find out how much this costs you each month, divide by 12.
http://www.dps.state.mn.us/dvs/index.html
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Insurance quotes
can be obtained on-line if you are over 18. For this project we
will assume that insurance will cost $800.00 per year. Divide by 12 to get your monthly insurance cost.
To obtain your total monthly cost, add your monthly payment, monthly tabs and monthly insurance. |
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Make
a Decision |
Using all the facts and
figures you have collected, choose one car to purchase. Document your
final selection in a new word document titled "Final Decision" along with your reasoning. |
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Maintenance
and Running Costs |
Your monthly cost
is not complete without adding the price of regular maintenance
fees
and fuel. In another Excel spreadsheet, calculate a total for these
expenditures. See sample spreadsheet below.
Assume you will change
the oil once every three months. Use a spreadsheet to calculate a monthly cost. We will assume and oil change will cost you $19.95 per service.
Assume you will need
one tank of gasoline every other week (hint: 52 weeks in a year/2). Use a spreadsheet to calculate a monthly cost.
Assume you will save
$50.00 per month for repairs, just in case.
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Find current fuel prices
at: SuperAmerica. Multiply
the current price by the tank size of your vehicle to get the cost
of one tank of gas. If tank
size
is
not
in the
information you have already found, check the manufacturer's web
site or talk to your teacher, we can make an educated guess. |
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Cost per Service/Tank |
Services per Year |
Annual Cost |
Monthly Cost |
Oil Change |
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Fuel |
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Repair |
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Total Monthly Cost |
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Create
Your Monthly Budget |
Your final Excel spreadsheet
will help determine if you can afford the car you have selected.
Create the spreadsheet below to determine your discretionary income
(income-less expenses). Don't forget to put at least
$100/month toward investing
or saving! |
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Income |
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Wages (monthly wage from part-time job in step one) |
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Other Income (allowance from parents) |
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Total Income |
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Expenses |
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AutoPayment Including Tabs, Insurance |
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Auto Maintenance, Running and Repair |
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Other Expenses (cell phone, entertainment, etc.) |
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Money to Invest/Save |
$100.00 |
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Total Expenses |
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Discretionary Income |
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Conclusion |
Can you afford this
car? Is it a good purchase for you? In
short report format explain your journey, what you learned
in each step of the process, what surprised you, etc. Conclude
with your final decision and appropriate reasoning.
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