Task: Personal Budgeting
George Marcus, a recent college graduate, has been hired by Taylor Corporation at a salary of $54,000 per year. In anticipation of his salary, George purchased a $20,000 new ski boat and will pay for it at a rate of $425 per month, including interest, for five years. He also rented a condominium for $600 a month and bought a car on account for $350 a month. In addition, George figures that his other monthly expenses will be:
1. On the assumption that George also pays income and FICA taxes of 25 and 7.65%, respectively, prepare his monthly budget.
2. George plans to save enough money for a down payment on a house. If a $20,000 down payment is needed, how long will it take him to save the needed amount? (For this exercise, ignore interest on savings, and assume that George does not have any savings at the present time.)