Hello, my name's Mrs. Hopper, and I'm looking forward to working with you in this lesson on personal finance.

We're going to be thinking about lots of different aspects around money, where money comes from, what money is spent on, how things are funded, and how the government raises money as well.

So if you're ready to make a start and to have some interesting discussions about how we make and how we spend our money, let's get going.

So in this lesson, we're going to be thinking about how we plan and manage a budget.

And hopefully by the end of it, you'll have some pointers as to how you can plan and manage a budget.

Let's have a look at what's in our lesson.

So we've got three keywords.

We've got budget, budgeting, and deficit.

So let's practise saying those words and then we'll look at what they mean.

So I'll take my turn, then it'll be your turn.

Are you ready? My turn, budget, your turn.

My turn, budgeting, your turn.

My turn, deficit, your turn.

I wonder if you've come across those words before.

Let's have a look at what they mean.

A budget is the money that is available and a plan of how it will be spent over a period of time.

Budgeting is the process of planning to spend an amount of money for a particular purpose.

And a deficit is the amount by which something, especially an amount of money, is too small or smaller than something else.

So the deficit is often the bit that you haven't got, the bit that you need to find.

So let's have a look at how those words are going to be used in our lesson.

There are two parts to our lesson today.

In part one, we're going to be thinking about planning a budget, and in the second part, we're going to be thinking about managing a budget.

So let's make a start with planning a budget.

And we've got Sofia, Sam, and Laura in this lesson with us.

Sam and Sofia decide that they both want to save up for a ticket to see England play.

I think that's looking like a football stadium, isn't it? Sam says, "We need to do some budgeting to work out how much of our pocket money we need to save and how much we can spend." Sofia says, "The tickets are 12 pounds each and they play in six weeks' time.

How much money will we need to save each week?" So how much will they need to save? Tickets are 12 pounds each and they play in six weeks' time.

So pause the video and work out how much they need to save each week to be able to afford the tickets.

What did you work out? Well, six times something is equal to 12.

12 divided by six is equal to two pounds.

So they need 12 pounds and they need to spread the saving over six weeks.

So to divide it between six weeks, so two pounds a week.

And they'll need to save at least that to be able to afford their tickets.

Sam and Sofia decide that they both want to save up for a ticket to see the Lionesses play.

Sofia says, "I get four pounds pocket money each week." I need to save two pounds each week.

That will mean that she's got enough to buy the ticket.

"So I can spend two pounds a week on other things," she says.

That's great.

So she's got a bit of a budget there.

As long as she saves two pounds each week, she can spend the rest on other things.

Time to check your understanding.

How much can Sam spend each week with this budget plan? She says, "I get £3.

50 pocket money each week.

I need to save two pounds each week.

How much money can I spend each week?" Pause the video, work it out and when you're ready for the feedback, press play.

I'm sure you worked that out pretty quickly.

£1.

50, £3.

50, and she's saving two pounds.

So she's gonna have £1.

50 left to spend.

With four weeks to go, Laura decides she'd like to go as well.

She gets five pounds pocket money per week, but she said, "I already buy some items weekly." So this is Laura's weekly spending of her five pounds pocket money.

She buys a comic for two pounds.

She buys stickers for a pound.

She spends 50 p on sweets and 50 p on biscuits.

What do you notice? Hmm.

Remember, she's only got four weeks left.

Over to you to check your understanding.

How much will Laura save per week? And is this enough to save up for a ticket that costs 12 pounds in only four weeks? Pause the video, have a go and wwhen you're ready for some feedback, press play.

So is it enough? Well, she spends a total of four pounds each week, two pounds plus one pound, plus two lots of 50 p.

So how much is she saving? She's saving one pound a week, isn't she? She says, "One pound a week for four weeks is equal to four pounds, and I need 12 pounds to be able to go." She says, "I think I'll need a new budget plan." I think you will, Laura, if you need 12 pounds.

Over to you, can you help her out for your task? How can Laura budget so that she can afford to buy a 12 pound ticket in four weeks' time? And can you find two different ways that she could do it? So how could you change her budget so that she can save enough money? Pause the video, have a go and when you're ready for some feedback, press play.

How did you get on? So here's one way that Laura could budget, but you might have found some other ways.

She says, "I need to save three pounds for four weeks to get the 12 pounds.

So she's got to get her savings up to three pounds.

So what could she do? Ah, well, she could out the stickers, the sweets and the biscuits for a while, couldn't she? That adds up to another two pounds.

So she'd be saving three pounds.

And Sofia says, "Now you will be able to come and you can still buy a weekly comic." Is that what you did? Maybe you said she wouldn't have the comic, but she'd still have her stickers and her sweets.

There are different ways to do it, aren't there? And you might have decided that she'd just save all her money.

So we're ready for the second part of our lesson now, which is about managing a budget.

So let's get going.

It's show time in year six.

I wonder if you do a show in year six at your school.

Sam and Sofia have been chosen to oversee the finances of the show, making sure that everything can be funded.

Well, it's a lot of responsibility.

I'm sure they're going to do it well.

The PTA, so that's the Parent Teacher Association, or the friends have donated 600 pounds towards the cost of putting on the end of year show.

"So we have a budget of 600 pounds," says Sam.

"Hmm, is that going to be enough?" says Sofia.

Sofia and Sam put together a list of what the show will need.

So they've got props, costumes, new lights, a backdrop, some special effects, and a set of some scenery.

Sofia says, "We'll need to work out how much all of this is likely to cost.

Sam says, "Let's research and write in some costs." So they've done a bit of research, they've got some estimated costs for what they need.

What's the total of these costs? Can you work it out? So all together, their costs total 1,200 pounds.

Oh.

"Let's compare that to our budget," says Sofia.

So the total cost is 1,200 pounds and they've had a donation from the PTA of 600 pounds.

What do you notice? "Oh dear," she says, "We have a deficit of 600 pounds." They need another 600 pounds to cover their costs.

"We need some more money," as Sam.

"What could we do?" So before we think about what they're gonna do, let's have a look here.

Can we work out the deficit here? We've got the total cost and the budget.

What is the deficit? Pause the video.

Have a go.

When you're ready for the feedback, press play.

How did you get on? The total cost was 1,400 pounds and the budget they had was 900 pounds this time.

So what was the deficit? That's right.

We're going to subtract the budget we've got from the total and our deficit is 500 pounds in this case.

So back to Sam and Sofia.

They're going to ask the head teacher if the school can pay to make up the deficit.

"Hooray," Sofia says.

"They'll lend us the 600 pounds." Ohh, they're lending them 600 pounds.

What does that mean? So there's a school loan.

Sam says, "So we have to pay it back." "Yes, after the performances," says Sofia.

"We need to make some money to pay off the school loan of 600 pounds." What do you think they could do? Any ideas? Sam and Sofia decide to sell tickets for the show to make up the deficit of 600 pounds.

"How many people will be in the audience?" asks Sam.

Sofia says, "We're performing twice to at least 100 people each time.

So all together, we'll sell at least 200 tickets.

So how much should we charge per ticket to make up the deficit? So what do you think? How much should they charge? You might want to pause and have a think before they do their calculation.

Sam and Sofia decide to charge three pounds per ticket.

200 lots of three pounds is equal to 600 pounds and that will pay off the loan from the school.

So they've got their tickets ready.

And Sam says, "If we sell any extra tickets, we can save that money as a gift for next year's show." That's a really good idea.

And then maybe the deficit won't be as much next year.

Sam and Sofia keep a record of their spending to ensure that they know what money they have left.

So let's have a look.

We've got a table here with the date that things happened, a description of what happened, what money came in, what money went out, and the balance is how much they had at the end of that day or that particular time.

So they had their PTA donation and their school loan.

They came in, then they spent money on the backdrop, the set, the new lights, the props and the costume and the special effects.

And the point where they'd spent all that money, they only had 99 pounds left, but then they sold tickets and they made lots of money from their ticket sales, more than 300 pounds a night.

So when they'd done all their ticket sales and with their 99 pounds, they had 729 pounds, they were able to pay off their loan repayment.

"Hey," says Sofia, "We managed to complete within our budget.

And there's some money for next year as well." How much money will be donated to next year's show? Have a look at the balance sheet.

Pause the video, when you're ready for the feedback, press play.

Did you spot it there? That's right.

129 pounds.

When they'd sold all their tickets, they had 729 pounds in their balance.

So they were able to pay the school back and leave 129 pounds for next year's show.

Time for you to do some practise at managing a budget.

The school disco is coming up.

Imagine that you've been chosen to manage the budget.

The PTA have budgeted 750 pounds for the event.

And below are the estimated costs of the things that you will need to buy.

So for A, can you draw a bar model of the budget and what you must buy, and what do you notice? B, can you calculate the deficit? And in part C, at least 100 children will go.

How much should you charge for each ticket? And then for question two, you're going to use some cards, which are on another sheet, and you're going to complete a record of spending.

Each card shows the final cost of purchase for each thing that you needed.

Cut out the cards, shuffle them and put them face down so you can't see them.

Turn over one at a time and fill in a row of the record.

So there's the record.

So each time you turn over a card, you're going to fill in a row for the record.

"And take a note of the ticket and the tuck shop sales," says Sam.

Part B, the final balance will be used as funds in the next disco.

How much is left over? And then finally, you're going to compare your table with somebody else's table 'cause you'll all have turned over your cards in a different order.

Does the order of purchasing and spending the money affect the final balance? Can you explain your answer? Pause the video, have a go and when you're ready for some feedback, press play.

How did you get on? So there's the table you were filling in and those were your cards.

So let's go to question one first.

So our bar model shows us that our budget of 750 pounds is not enough, is it? We've got a deficit.

How much is the deficit? Well, it's 300 pounds.

The total cost was 1,050 pounds and you had a budget of 750 pounds.

So 300 pounds is needed.

For C, at least 100 children are going to go.

So how much should you charge for each ticket? Well, 100 times three is 300.

So if you charge three pounds for a ticket, you should cover the cost of your deficit.

So part two, you had to manage this sheet and turn over those cards.

This is Sofia's completed sheet.

So what did we notice? Was there some money left over? Yes.

Once that money had gone in, the PTA donation, the school loan, the ticket sales and the tuck shop sales, and you paid out all that money on new speakers and everything else, paid back your loan, and you were still left with £239.

50.

So you'd made a profit, money that you could put maybe to next year's disco or put towards buying something for the school.

And for part C, you were going to compare your table with somebody else's.

Did the order of purchasing affect the final balance? And can you explain your answer? Sam says, "I completed mine in a different order to you, Sofia, but I still had a final balance of £239.

50." The order that you spend things doesn't affect the final balance.

We know that addition is commutative, don't we? So however we made up that total cost that we spent, it didn't matter which order we spent it in.

Addition is commutative.

And we've come to the end of our lesson on planning and managing a budget.

What have we thought about? Well, we've realised that when saving up for something expensive, you can budget into money that you will spend and money that you will save.

A table can help you to calculate how long it will take to save for an expensive item when using a budget in this way.

And when you're managing a budget, that involves keeping track of spending and finding ways to overcome any deficits where spending is greater than the budget allows.

I hope at some point you'll have the chance to plan and manage a budget for yourself.

I've enjoyed working with you today and I hope we get to work together again soon.

Bye-bye.