Budgeting
A plan for how you will spend and save your money.
Budget
What is credit?
Money borrowed that must be paid back later.
What are savings?
Money set aside for future use.
What is investing?
Using money to buy assets that may grow in value over time.
What are taxes?
Money collected by governments to fund public services.
What are needs?
Rent, groceries, and utilities
This three-digit number helps lenders determine your creditworthiness.
Credit Score
What is an emergency fund?
A fund used for unexpected expenses like car repairs or medical bills.
What are stocks?
Ownership shares in a company.
Roads, schools, and emergency services are funded by these.
Taxes?
What is a surplus?
Money left over after income minus expenses.
What are things that improve your credit score?
Paying bills on time, Using 30% or less of your credit limit, and how long you have had your credit card generally has this effect on your credit score.
Experts often recommend saving this percentage of your income as a starting goal.
What is 10%?
What is a fixed expense?
This type of expense usually stays the same each month, such as rent.
What is gross income?
The amount earned before taxes and deductions.
What is a trade-off (or opportunity cost)?
The financial term for giving up one thing to get another.
What is interest?
The cost of borrowing money.
What is overspending?
Spending more money than you earn each month.
Generally, investments with higher potential returns also have higher ______.
Risk
What is net income (take-home pay)?
The amount received after taxes and deductions.
You earn $2,500 monthly and spend $2,200. How much remains?
$300
Name one factor that affects your credit score.
Payment history, credit utilization, length of credit history, new credit inquiries.
If you save $100 per month for 12 months, how much will you save?
$1200
Who will likely have more money at retirement: someone who starts investing at age 18 or age 30, assuming the same monthly contribution?
The 18 year old will likely have more money
Name one tax commonly deducted from a paycheck.
What is federal income tax, state income tax, Social Security tax, or Medicare tax?