Key terms
What is a fixed expense?
What is an expense that stays the same month to month?
What percentage of Americans say budgeting is important, but don’t create one?
What is 95%
What is an expense for things you don’t need?
discretionary expense
Zero-Based Budget
a cash-flow plan that assigns an expense to every dollar of your income; the goal is for the total income minus the total expenses to equal zero
What would you do if you realize your budget doesn't balance to zero
finds ways to increase income or create more categories for your money to go
What is a written plan for giving, saving, and spending?
What is a budget?
What percentage of Americans actually budget?
What is 35%?
How can you make sure your money lasts the whole month when budgeting?
by creating categories for your expenses
Net Income
what a person earns after payroll taxes and other deductions are taken out; often referred to as take-home pay
How would you prioritize spending if you had a limited amount of money?
pay for food, shelter and save some
What is a variable expense?
What is an expense that changes month to month but is expected?
What is your biggest wealth-building tool?
Income
How much of your gross income should you budget to invest for retirement once you’re out of debt?
15%
Gross Income
the amount you earn before taxes and other payroll deductions
What do you think might happen if you don't give every dollar in your budget a job?
you might spend money on things you don't need and run out of money for important expense like bills or savings
What is the term for money received through work, as a gift, or through investments?
What is income?
What does a budget give you freedom to do?
freedom to spend money on what you want?
How can you make room for intermittent expenses in your budget?
Plan for them in advance by setting money aside throughout the year
What are the Four Walls that should come first in a budget
What are food, utilities, shelter, and transportation?
What is the most effective budget?
Zero Based budget
What do you call an expense that happens at various times during the year, usually in large sums?
What is an intermittent expense?
What is the primary tool for making the most of your income and building wealth?
What is a monthly budget?
What expense category includes items like gas, oil changes, and utilities?
What is a variable expense?
The Four Parts of a Budget
income, giving, saving, and spending.
A budget simply shows
you what your income is (the money coming in) and what your expenses are (the money going out) for a set period of time