Test Q's 1
What is the average inflation rate?
3% per year
What is a budget?
A plan for saving and spending money
What does living within your "means" mean?
Avoiding debt for wants, spending less money than you make
Why is creating a budget so important?
It helps you visualize your income and expenses
How does your net worth increase?
Assets increase or liabilities decrease
Why is financial planning important?
Helps you live within your means
Why is it important to keep track of small expenses?
They add up to large amounts over time
If you are spending more money than what you budgeted for, what should you do?
What is premature affluence?
Teens who have no bills but have income who get used to spending their money on wants
What is an example of discretionary spending?
- Streaming services
- Entertainment
- Vacations
What are the two largest categories of consumer spending?
Housing and transportation
- Avoid running out of money between paychecks
- evaluate bad spending habits
- set aside savings