Budgeting Basics
What is net pay
A number that shows how trustworthy you are to lenders
What is a credit score
Total earnings before taxes are taken out
This is usually the largest monthly expense for most adults
What is housing
“Buy now, pay later” can lead to this if not managed well
What is debt
An expense that stays the same each month like rent
What is a fixed expsense
Paying only this on a credit card increases total interest paid
What is the minimum payment
This form shows your yearly income and taxes from your employer
What is a W2
This cost includes oil changes, gas, insurance, and repairs
What is transportation
This type of card usually has very high interest rates
What is a credit card?
Money left after all expenses are paid
What is savings or disposable income
This is the cost of borrowing money, usually shown as a percent
What is interest rate
Money taken out of your paycheck for government programs like Social Security
What are payroll taxes
This monthly bill includes electricity, water, and heat
What are utlities
Loans that seem easy to get but have extremely high fees are often called this
What are called predatory loans
A plan that tracks income and spending
What is a budget
Using a high percentage of your available credit hurts this
What is your credit score
The difference between gross pay and net pay is mostly this
What are taxes and deductions
This upfront payment is often required before renting an apartment
What is a security deposit
Only making minimum payments causes this to grow over time
What is interest or total debt
Needs, wants, and saving are often divided using this common budgeting rule
What is the 50/30/20 rule
This type of loan often has very high interest and short repayment periods
What is a payday loan
This form is typically used for freelance or contract work instead of a W2
What is a 1099
This cost is often forgotten when budgeting for a car purchase
What is insurance or maintenance
This happens when you spend more money than you earn
What is going into debt