Vocab
What is a plan of your expected income and how you will use it to meet your expected expenses over a period of time?
Budget
T/F You should use your net pay when calculating your budget
TRUE
To automatically save a specified amount from your paycheck before budgeting it into any other category
Pay Yourself First
You are school supply shopping and see that there is a packet of 10 pencils for $4.30. How much does each pencil cost?
$0.43/pencil
When your expenses exceed your income
Deficit
T/F A lease is an agreement between you and your roommates that you submit to the apartment owner
FALSE
Nonessential purchases a person wants to feel happy, make life convenient, fit in with peers, etc
Wants
Alex’s Monthly Salary: 4,500
Take-Home Pay: 3,200
What is his Gross Pay?
What is his Net Pay?
Gross Pay: $4,500
Net Pay: $3,200
Total earnings before any deductions are taken
Gross Pay
T/F A bad budgeting strategy is to build a weekly meal plan around items you already own or items that are on sale that week, rather than just choosing foods you'd like to eat.
False
When it comes to buying a car, will a bigger down payment or lower interest rate save you more money in the long run?
Lower Interest Rate
At Grocery Mart, potatoes are $1.49 per pound, or you can buy a 5 pound box for $7.75.
What is the unit price for the first potato option?
What is the unit price for the second potato option?
Based on price, which is the better value option?
1.) 1.49/pound
2.) 1.55/pound
3.) Option One - 1.49/pound
Total earnings after payroll taxes and other deductions; also called take-home pay
Net Pay
Which of the following is a BAD budgeting strategy to use if you want to save money at the grocery store?
A. Prepare a grocery list before you go to the store, and avoid buying items that aren’t on the list
B. Build a weekly meal plan around items you already own or items that are on sale that week, rather than just choosing foods you'd like to eat
C. When comparing similar products, focus on the price only
D. When comparing similar products, be sure to compare based on unit price
C
What is common for a renter to have to supply to the landlord at the time you sign the lease in order to get an apartment?
First and last month's rent + a security deposit to cover any damages to the apartment
You are putting together your first post-graduation budget. Your take-home pay will be $3,000 per month. You estimate your monthly costs to be: rent of $1000, car related expenses to be $550, entertainment of $300, food expense of $350, cable bill of $175, mobile phone of $150, student loan payment of $700 and other expenses of $250. How would you describe your budget after analyzing all of your income and expenses?
Deficit of $475
When your income exceeds your expenses and you have money leftover
Surplus
Brielle is buying a new car and wants to negotiate with the dealership to bring the price down. Which of the following strategies will help Grace the MOST?
A. Walk into the dealership, state her desired price for the car, walk out and wait for the salesperson to say “yes” or “no”.
B. Come to the dealership with a pre-qualified loan in hand from her bank so that she can negotiate the terms of a loan through the dealership.
C. Say the name of a pricing guide like “Edmunds” or “Kelly Blue Book” while speaking with the salesperson to show them that she’s done her research.
D. Shop at just one dealership so that she can talk to multiple salespeople there to see who will give her the best deal.
B
What does each number represent for a 50/30/20 Budget?
Financial plan that allocates 50% to needs, 30% to wants, and 20% to savings and debt repayment
You earn a salary of $50,000 per year and decide to save 20% of your gross pay. You then set a goal of creating a $25,000 emergency fund. How long will it take for you to achieve your goal?
2.5 Years