Future Cost of Living Project.

The purpose of this project is

• To demonstrate your skills with Excel.
• To help you make progress towards your final project.

Select one of the jobs in your job report and assume that you have been hired to do that job. For this project you will need to estimate the cost of living associated with that job. For the purpose of this project, you may not assume you will be living at home, or with a relative unless this is your life partner or spouse, you are expected to live on your own.

• The project should consist of at least the following worksheets:
  • A summary worksheet, which reports both income and expenses.
    • There should be no computations on this page, just links to other pages.
  • A salary worksheet
  • A Loan worksheet, this will be referenced in another worksheet.
  • A worksheet which describes transportation costs
  • A worksheet which describes housing costs
  • A worksheet related to Food costs.
  • A miscellaneous worksheet.
  • A summary worksheet.

  Salary

  • Please note: This is to provide an estimation of your taxes, it is in no way tax advice. Furthermore, it is only an estimate and most likely contains errors.
  • Start by entering or calculating your annual gross salary.
  • For IRS purposes, you are allowed to place a percentage of your salary in a retirement account (401K, 403B, ...)
    • The amount depends on your contract
    • In this case assume 5%
    • Compute the amount of deffer ed salary
    • Compute the IRS Gross Annual Salary
    • 
  • Next calculate federal taxes
    • This site helpful.
    • Decide on your filing status, in this case assume Single
    • Secondly decide on additional dependents, assume 0.
    • Construct a deduction table based on the information on the above web site.
    • 
    • After this, start a Tax Worktable
      • 
      • This is just information looked up in the tables, along with a final computation.
    • Build a tax rate table, again based on the web page.
    • 
    • Look up the Taxable income in this table based on tax status.
      • Do a vlookup, but it can be specialized to your status in this case.
      • The Taxable income was at least $9,075 but not more than $36,900 so the tax rate is 15%
      • 
    • And calculated the federal income tax based upon this rate.
    • 
    • Build some assumptions for other taxes and health insurance
    • 
    • Calculate these taxes and fees
      • State and local taxes are based upon your Federal taxable income
      • Medicare is calculated based on your Annual Salary
      • Insurance, Estimate $4000.
    • Finally, calculate the Annual Net Income
      • Gross income minus all of the taxes and deductions
      • 

  Student Loans

  • The following sites are helpful here
    • StudentLoans.gov
    • Especially This page.
    • Loan Limits
    • You can find some loan information on SCOTS
    • But I am told full information on your loans is available here
  • You most likely have at least two different student loans
    • Subsidized
    • Unsubsidized
  • In addition you possibly have a loan with your parents at a private bank.
  • Use the techniques described in these notes to compute your monthly payment for all of your student loans.
    • You should do this in a new worksheet.
    • 
    • You should then copy the total monthly payment to the expense portion of you summary sheet.

  Other Worksheets

  • As noted on the project page, you should estimate other expenses.
  • This can be based on your current expenses, but should be adjusted for the location you will move to.
    • Food
    • Clothing
    • Utilities
    • A cost of living calculator is useful here. (See this site for example.)
  • Other expenses you should do research and calculate.
    • Housing: actually find a house/apartment to rent/buy
    • Transportation, depending on what you do:
      • Find costs for buses, taxis, trains
      • Calculate the cost of a new car
      • Include gas and parking fees
      • Don't forget car insurance.
      • And an estimate for maintenance
  • Do your best on these estimates, they are estimates.

  Summary Worksheet

  • Collect all information on a summary worksheet.
  • I did calculations for both annual and monthly income.
  • Include a balance at the bottom.
  • 

  Other Notes

  • All fields in your workbook should be clearly labeled and well formatted
  • All assumptions should be isolated and labeled.
  • All computations should be performed in the workbook.

  When you have completed this project. Email it to your instructor as an attached excel file.