Money Basics
This is the general term for a plan of how you will spend and save your income.
What is a budget?
Rent, groceries, and this monthly utility that keeps your lights on are all considered needs.
What is electricity?
This is the first step of budgeting: writing down all the money you expect to receive.
What is tracking/listing your income?
Putting money aside instead of spending it is called doing this.
What is saving?
This type of bank account is used for everyday spending, like debit card purchases and bill pay.
What is a checking account?
Money you receive, like from a job, is called this.
What is income?
A streaming subscription or eating out are usually classified as this, not a need.
What is a want?
A simple budgeting approach splits income into needs, wants, and this third category.
What is savings (or goals)?
Money you owe to someone else, like a loan or credit card balance, is called this.
What is debt?
This type of bank account usually earns interest and is meant for holding money you're not spending right away.
What is a savings account?
An expense that stays roughly the same every month, like rent, is called this type of expense.
What is a fixed expense?
This word describes spending decisions guided by emotion rather than a plan.
What is impulse (or emotional) spending?
This word means checking your spending regularly against your plan.
What is tracking (or reviewing) your budget?
The extra amount a lender charges you for borrowing money is called this.
What is interest?
This three-digit-plus number reflects how reliably you've paid past debts and affects your ability to borrow.
What is a credit score?
An expense that changes month to month, like groceries or gas, is called this type of expense.
What is a variable expense?
Setting money aside on purpose for something you want later, instead of buying it now, is called doing this.
What is saving up?
Money set aside specifically for unexpected costs, like a car repair, is called this fund.
What is an emergency fund?
The smallest amount you're required to pay on a credit card bill each month is called this.
What is the minimum payment?
This fee is often charged when you spend more money than is in your checking account.
What is an overdraft fee?
Spending less money than you earn each month results in this.
What is a surplus (or savings)?
This term describes what you give up when you choose to spend money on one thing instead of another.
What is opportunity cost?
This term describes a budget where income minus expenses equals zero, because every dollar is assigned a job.
What is a zero-based budget?
A savings account you don't touch except for true emergencies, usually covering 3-6 months of expenses, is called this.
What is an emergency fund?
This document, sent monthly, lists all the transactions in your bank account.
What is a bank statement?