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Welcome to Money Management for the 

Common Man, a basic overview of how to 

manage your wealth, personally.  

In this course you will learn the basics of 

banking, taxes, the creation of a statement of 

financial position, income and expenses, and 

the drafting of a spending plan.

Whether or not you are successful is not of my 

concern; you bought this book and that makes 

me a winner.  

First, we'll start with the basics.   Banks and credit 

unions are known as "depository institutions" (duh-

paw-zit-oree in-stuh-too-shuns).  

These are places that are allowed to accept 

deposits from citizens. That means that I, or even 

you, can enter one of these facilities and make 

transactions with my money.  

Generally, they are a good place to store your 

money in a savings account.   The Federal Deposit 

Insurance Corporation will protect your savings up 

to $250,000.   After that, go Swiss.

So, what's the difference between a 

commercial bank and a credit union?

Well, a commercial bank, like Bank of 

America, accepts deposits, gives loans (ex: 

business and auto), and offers basic investment 

utilities. 

A credit union, like Coastway, is generally 

democratized and offers its services to people 

of similar profession or occupation.   It's usually 

more community based and local, but still a 

competitive option.

Now, any good venture capitalist knows that 

you have to spend money to make money.  

Even though saving your money is safe, and 

interest will allow it to grow, you have to spend 

at least some of your capital.  

Now it's time to show you how to be the good 

little consumer you were born to be.  

Welcome to Walmart, the pinnacle of American 

capitalism.  

It is here that you can spend your money 

through use of a debit card or checks that the 

depository institution of your choice may 

provide.   But be warned,

YOU SHOULD ONLY SPEND WHAT YOU HAVE.

So, let's start by budgeting our money with a 

spending plan. 

What is a spending plan you ask? Well, a 

spending plan shows you what money you 

have coming in and what you are spending it 

on.  

If you make more than you spend, you have a 

net gain.   If you spend more than you make, 

you have a net loss.  

It is vital that you chart ALL of your expenses to 

make an accurate spending plan.   Leave no 

expense out, all money is important.     To be a 

safe spender, you have to budget.

Now, if you are a citizen of the United States, 

you are likely benefiting from public programs 

like police and fire protection or the education 

system.   However, these are not free 

programs.  

They are funded through duties known as 

"taxes".  

So, let's first define what a tax is.  

Taxes are:

a necessary contribution to the revenue of states, 

nations, or municipalities added onto the cost of 

goods or services or levied on assets and property.  

As a citizen, you are a 

taxpayer, but there is no 

"umbrella" tax that covers 

everything.   Coming up 

next, find out what types 

of taxes there are!

Types of Taxes

Income Tax: a tax levied by the government, usually 

annually, on personal income

Payroll Tax: a tax on employers or employees 

calculated as a percentage of salaries given to staff.  

They are deducted from employee salaries, and paid 

by the employer.   Not to great for we job creators no?

Sales Tax: a tax paid to the government for the 

purchase of goods and services.

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