Needs VS Wants
What is a need?
Needs are the things you can't get by without, such as a place to live and food to eat.
Unearned income, as the Internal Revenue Service (IRS) calls it—is income that requires minimal effort to obtain
What is Financial Literacy?
The ability to use knowledge and skills to make effective and informed money management decisions
What is Investing?
When you buy something in hopes that it’ll appreciate (a.k.a increase in value) or generate income. Putting your money towards something in hopes that it grows.
What is a Budget?
A budget is a plan that helps you manage your money.
What is a want?
Wants are nice to have but not necessary, such as entertainment or gym memberships
What is active income?
Income received from a job or business venture that requires active participation.
True or False: Financial literacy isn't just about creating and sticking to a budget; it’s essential for everyone, regardless of income, age, and educational level.
True
What is Appreciation?
When something grows in value (think: buy low and sell high)
What are necessary expenses? And give an example.
Are the bare minimum you need to maintain living each month
What could be a need and a want? List something that qualifies as a need and a want then explain why.
Car, clothes, food, entertainment, etc...
Is renting property active or passive income?
Passive
True or False: 38 percent of adults have less than $1,000 saved for financial emergencies.
True
What is Income in the world of Investing?
When an investment puts money in your pocket without you having to sell it.
What does it mean to pay yourself first?
Setting aside money for yourself in your savings account, to help pay debt, or make a large purchase later.
When does a need become a want?
Needs become wants when you are meeting your basic needs yet doing so above your ‘means’
Active
True or False: 7% of teens lack confidence in their knowledge of personal finance.
False: 75% of teens lack confidence in their knowledge of personal finance.
What is Real Estate?
Involves the purchase, management, and sale or rental of real estate for profit
What does Budgeting help you avoid?
Overspending, debt, or running out of money a.k.a being broke
Maslow believed that humans must meet their lower-level “ ” before pursuing higher-level “ ”
"needs"...."wants"
What is dropshipping?
You do not stock or own the inventory. Relies on a third-party supplier to handle inventory warehousing and order fulfillment.
Money set aside for big, unexpected expenses such as job loss or large medical bills. It provides a financial buffer that shields against accruing unwanted debt.
Emergency Fund or Emergency Savings
What is Retirement?
Plans that help individuals set aside money to be used after they retire. Types of retirement plans include IRA, Roth IRA, and 401K
Who actually gets paid first from your pay check?
Uncle Sam....The Government....Taxes....IRS