Financial Terms
What is money you earn from a job called?
Income
Why do people save money?
To use it later or reach a goal.
What is the purpose of a budget?
To plan how you spend and save money.
What is investing?
Using money to try to make more money over time.
Which is a need: housing or a toy?
What is something you must have to live called?
A need
Name one thing someone might save money for.
Bike, toy, college, vacation, etc.
You earn $25 and spend $10. How much do you have left?
$15
What is a stock?
A small piece of a company.
You receive $20 for your birthday. Is it smart to spend all of it immediately?
No. Saving some is usually a smart choice.
What is something you would like to have but don't need called?
A want.
True or False: Saving all your money means you can never spend it.
False
If you only have enough money for one thing, what should you buy first?
Your needs. Housing, food, basic clothing, etc.
Why do people invest?
To grow their money over time.
You have enough money for either a new game or to save for a bike. What might you consider before deciding?
Your goals, needs, and what is most important to you.
What is a budget?
A plan for how you will spend and save your money.
You earn $10 every week. Should you save a little each week or wait until you need money?
Save a little each week because your savings will grow over time and you'll be prepared for emergencies.
Why is it important to keep some money instead of spending it all?
To prepare for future needs or emergencies.
True or False: Investments always make money.
False
You forgot to save money, and now your car tire is flat. Why would an emergency fund have helped?
You would have money set aside for unexpected expenses.
What is an emergency fund?
Money saved for unexpected expenses.
You have $40 and want something that costs $60. What is the smartest choice?
Save more money until you can afford it.
A toy costs $18. You have $15. What can you do?
Save more OR choose a less expensive toy.
What is one difference between saving and investing?
Saving is safer but grows slowly; investing has more risk but can grow more.
You have $100 that you won't need for 10 years. Is it smarter to save it or invest it? Why?
Invest. Since it's a long-term goal, investing gives the money more time to grow, even though there is some risk.