Benefits of Budgeting
Before you create a Budget you need to know what?
your net-worth
What is your first priority in your budget? (10%)
giving
What is gross income?
the amount you earn before taxes and other payroll deductions
What is the second half of successful budgeting?
tracking your expenses
What is irregular income?
income that comes in at different amounts or at different times, or both
What is a Budget?
a written plan for giving, saving, and spending.
What is income?
money received for work, as a gift, or through investments
What is net income?
what a person earns after payroll taxes and other deductions are taken out; often referred to as take-home pay
What is a Cash Flow Statement?
a record that summarizes all of the income and outgo (spending) over a certain time period.
spenders and savers.
Personal finance is 20% __ and 80% __.
20% Head knowledge , 80% Behavior
How do you keep your budget even more on track?
you need to break your budget down even further into separate categories
What are the Four Walls?
food, utilities, shelter, and transportation
What are some things you could do to fix the shortfall?
make some adjustments in your categories that will prevent shortfall
getting the habit of budgeting down early in life will help you find and keep__?
peace of mind and stress free.
A Budget shows you...
what your income is and what your expenses are.
What are the 4 basic parts of a Budget?
income, giving, saving, and spending.
What is a Zero-Based Budget?
when your income minus your giving, saving, and spending equals ZERO
Why is it important to track your expenses?
gives you control over your finances, helps you achieve your financial goals, and promotes better financial habits
Do you still need to create a Budget even if you don't have a lot of money or in high school?
yes because you still get money from holidays, birthdays or from parents and it will help you know how to budget for the future.
Why is it important to create a Budget?
so you’re in control of your money, and you don’t have to wonder where it all went.
What are the 4 expense types?
Fixed, Variable, Intermittent, and Discretionary Expense
What are the 5 Foundations?
1) Save a $500 emergency fund, 2) get out and stay out of debt, 3) pay cash for your car 4) and college, 5) build wealth and give
What is the envelope system?
put the amount of cash you’ve budgeted for each category in its own envelope labeled and when you buy something use the cash from its envelope, once the cash is gone, no more spending.
How do you budget with a irregular income?
first find your lowest monthly earnings and build a budget around it. prioritize covering essential expenses first, and then build emergency fund with any extra income from higher-earning months