Credit or Debit
If your _________ is high, this is bad for your credit but good for your debit.
balance.
What does each percentage of 50-30-20 stand for?
50% of your budget goes to needs
30% of your budget goes to wants
20% of your budget goes to savings
How much money is ideal to have in an emergency fund?
At least 3-6 months' worth of expenses!
Using cash instead of credit cards can help you stay within your budget.
True (Spending cash makes you more aware of your spending.)
Daniel earns $1,700 per month. He follows the 50/30/20 budgeting rule. How much of his income should go to needs, wants and savings?
Needs: 50% of $1,700 → $850
Wants: 30% of $1,700 → $510
Savings: 20% of $1,700 → $340
What is the biggest difference between a credit and a debit card?
A debit card does not allow you to borrow money from the bank, but a credit card does.
What is the first step in creating a budget?
(A) Spending money on essentials
(B) Tracking your income and expenses
(C) Applying for a loan
(D) Guessing how much you spend each month
(B) Tracking your income and expenses
How much is sales tax in Ontario?
13%
5% – Federal Goods and Services Tax (GST)
8% – Provincial portion of the HST
A credit score can range from 250-800.
False - from 350-800.
Liam has a credit card balance of $2,500. His credit card company requires a minimum payment of 3% of the balance each month.
How much is Liam's first minimum payment?
2,500 × 0.03= 75
Liam's first payment is $75.
What does an "interest fee" mean in financial literacy?
A fee for borrowing money.
What is the difference between a short-term goal and a long-term goal?
To reach long-term goals, you may have to save for over a longer period of time and may cost a lot of money.
Short-term goals are usually easier to achieve and may not be as costly.
A payday loan is a great way to borrow money because it has low interest rates.
False (Payday loans have extremely high interest rates and fees.)
The balance on your chequing account (debit) cannot go below 0.
You are furnishing your apartment at IKEA and all your items cost a total of $5,690. How much will the sales tax be?
How much will you end up paying in total?
Sales tax = $5,690 × 0.13
Sales tax = $739.70
$5,690 + $739.70 = $6,429.70
What happens if you do not pay off your minimum amount by the due date?
-You get charged interest fees on your remaining balance
-damage to credit score
-late penalty fees by the bank
If your total income is $1,500 per month and your expenses are $1,800, what should you do?
Cut unnecessary expenses or increase income.
What is income tax?
Taxes on income you earn from a job that the government requires you to pay. This tax increases with the more money you make!
Example: If you make $50,000 a year, roughly 20$ of it will go to taxes ($10,000).
A high credit score makes it easier to get loans with lower interest rates.
True
Emma has a credit card balance of $1,700 with an annual interest rate (APR) of 18%.
If she only pays $100 of her balance the first month, how much will she be paying in interest fees?
18%÷12=1.5% (or 0.015 as a decimal)
1,700 - 100 = 1,600.
1,600×0.015=24
She will be paying $24 in interest fees the first month.
What is a credit score used for?
(A) To measure how good you are at math
(B) To determine your ability to repay borrowed money
(C) To track how much money you have in your bank account
(D) To check how much you spend on shopping
(B) To determine your ability to repay borrowed money.
True or False:
If you do not have a job, you do not have to budget.
False!
What percentage of your credit card limit should you avoid using?
You should avoid using more than 30% of your credit limit to maintain a healthy credit score.
Example: If your credit limit is $1,000, try to keep your balance below $300.
Interest on a savings account is a positive thing.
True. With some savings accounts, like a TFSA (tax-free savings account), banks pay you interest as a reward for keeping your money in a savings account.
Alex earns an annual salary of $45,000 in Canada. Based on the 2024 federal income tax brackets, he is taxed 15% on the first $53,359 he earns.
What is his take-home pay after federal tax is deducted?
Federal Tax = 45,000 × 0.15 = 6,750
$45,000 - $6,750 = $38, 250.
Alex’s take-home pay after federal tax is $38,250.