Expenses
What is a Fixed expense
An expense that is the same every month
The most common type of income
Wages and salary
What is the 50-30-20 budget?
50% of net pay on needs, 30% of net pay on wants, 20% of net pay on savings.
How does interest rate affect the total cost of a car?
Higher interest rate, higher cost
If you are moving in a couple of years, is it better to rent or buy?
Rent
What is a variable expense?
An expense that occurs every month but the amounts are different
Income that can be earned from property
Rental income
What is the envelope method?
Put budgeted amount in envelopes and when the money is gone, the spending on that stops
Greater the down payment the lower the cost of the car
If you want to have no housing payment when you are retired, is it better to rent or buy?
Buy
What is an irregular expense?
An expense that does not occur every month
Income that can be earned from savings
Interest income
Start with the smallest debts and pay them off first
What are other kinds of costs that factor into the cost of a car besides price? Name 3.
Depreciation, insurance, gas, repairs, maintenace
Larger down payment, lower interest rate
What is an example of a fixed expense?
Rent, car payment, car insurance payment
Income that can be earned from stocks
Dividends and capital gains
What is the debt avalanche
Pay off the highest interest debts first
What cost do you save on if you buy used?
Depreciation
What is a disadvantage of renting? Name 3.
No equity, no pets, landlord rules, rent increases
What is an example of an irregular expense?
Car repair, doctor's bill, vet bill
Income that can be earned from bonds
Interest or capital gains
What types of expenses are easiest to cut?
Variable
What cost is higher if you buy used?
Repairs and maintenance
What is a disadvantage of buying? Name 3.
Repairs and maintenance, larger upfront costs, harder to move when you want to