Chapter 10 Lesson 1 Ramsey Classroom
Chapter 10 Lesson 1 Ramsey Classroom
Chapter 10 Lesson 1 Ramsey Classroom
NAME DATE
DIRECTIONS
Read and annotate the article below, then answer the following questions based on the information you just
read. You may also use the information in the student text to help you answer the questions.
If you’re like most folks, the first two ques- 2. Discretionary spending is spent on pro-
tions that pop into your head when you look grams that Congress sets aside for a specif-
at your tax return each year are How much ic purpose and must regularly review. This
did I make? and How much did they take? includes spending for defense/military,
Who’s “they”? The federal government, education, transportation, and health.
of course. 3. Interest on national debt
And while you grumble about how
much Uncle Sam takes out of your paycheck Take a look at how this is broken down.
every two weeks, there’s another question
INTEREST ON NATIONAL DEBT
you might wonder about: What are they
$475 BILLION 8%
doing with my tax dollars anyway?
That’s a great question . . . especially TOTAL
DISCRETIONARY SPENDING
since the IRS collected around $4.9 trillion 27%
$6.3
$1.7 TRILLION
in federal taxes in 2022 from hardworking TRILLION
65%
taxpayers like you. That’s trillion—with a T! MANDATORY SPENDING
Those tax dollars went toward the $6.3 tril- $4.1 TRILLION 2
lion in government spending that year.1
It’s time to pull back the curtain and find
out where your tax money goes. Basically, Interest on Government Debt
there are three main categories: The U.S. government is currently more than
1. Mandatory spending, also known as $32 trillion in debt—and counting—with a
entitlement spending, is not subject to small percentage of your tax dollars going
regular budget review. This is used for toward paying the interest on that debt.
things like Social Security, Medicare, The interest on the national debt, which
Medicaid, and veterans benefits. must be paid by the federal government each
This is a partial excerpt from “What Do Your Taxes Pay For?” (Ramsey Solutions, 2023).
1. Internal Revenue Service Data Book, 2022 (Washington, D.C.: Internal Revenue Service, 2023), 1.
2. “The Federal Budget in Fiscal Year 2022,” Congressional Budget O!ce, March 2023.
3. At what age does someone qualify to receive full Social Security benefits? Who gets
those Social Security payments?
You get social security at 65. Mostly retired family members
4. What’s the average Social Security monthly payment for a retiree? In your opinion, is
that enough to live on? Why or why not?
$1555, I don't think that $1555 can make for a very comfortable retired life-style.
6. What’s the major difference between mandatory spending and discretionary spending?
Discretionary spending must be approved by congress but mandatory happens automatically
1/2
8. Why is deficit spending and the national debt so crucial to pay attention to?
It effects the funding of important programs
9. If some discretionary funding for veterans benefits were cut, what would be impacted?
Veterans would have less health coverage and job insurance.
15. What additional questions did this article raise for you?
Government money and saving for retirement.
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