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## Monday, April 30, 2007

### Earn a Living and Live on What you Earn

This is how I have learned to feel successful as a teacher of 8th graders running to the exit at the end of the year. I have a fairly complex Internet project in which they are asked to purchase a house, a car, find a job and create a budget to live. I do this for several reasons. The first is that I seem to recall thinking about these topics at this age, wondering how I would make it work (I have managed so far...). Secondly, I would like my students to begin to understand the complexities of the financial world in which we live so that they may appreciate what they have, where they live and also consider the consequences of their actions

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Earn a Living
and
Live on What
You Earn !

In this project you will:

1. Buy a house and calculate the monthly payments and total cost;

2. Buy a car and calculate the monthly payments and total cost;

3. Shop for a month’s worth of food and houshold items and determine their total cost;

4. Make some calculations to figure out what you can afford and learn
to use the mortgage and loan calculators found on the Internet.

5. Create a mock budget which conforms to the limits placed on your income and purchases.

Here’s some info you need before you get started:

1. You make \$46,000 per year (median US income).

2. Your dream house cannot be more than 30% of what you make in
eight year at your current income.

3. You will finance your house over 30 years. On average, with interest,
you will pay 3 times the purchase price when you finance a house
over 30 years.

4. Your dream car cannot be more than 35% of your annual income.