Budgeting
This is a plan for how you will spend and save your money.
What is a budget?
This type of account is typically used for everyday spending and debit card purchases.
What is a checking account?
This is the total amount of money you earn before taxes are taken out.
What is gross pay (or gross income)?
This form tells your employer how much withholding to take from your paycheck.
What is a W-4?
You buy something you don’t need just because it’s on sale. This is called this type of purchase.
What is an impulse purchase?
This term describes something you enjoy spending money on even though you know it’s not a necessity and may not fit your budget.
What is a guilty pleasure?
This term refers to signing the back of a check to deposit or cash it.
What is endorsing a check?
This document shows your earnings, deductions, and net pay for each pay period.
What is a pay stub?
This form shows your gross income and how much federal tax was withheld during the year.
What is a W-2?
Using a card to borrow money that you must pay back later is called this.
What is using a credit card?
This term refers to extra pay earned for working less desirable hours, such as nights, weekends, or holidays.
What is a wage differential?
This banking feature allows you to spend more money than you have, often with a fee.
What is overdraft?
These are required taxes taken from your paycheck for programs like retirement and healthcare for seniors.
What are Social Security and Medicare (FICA) taxes?
This is money returned to you if you paid too much in taxes throughout the year.
What is a tax refund?
This number shows how trustworthy you are to lenders.
What is a credit score?
In the 50/30/20 budgeting rule, this portion of your income is allocated to needs such as housing, groceries, and utilities.
What is 50%?
This type of account requires you to leave your money for a set period of time in exchange for a higher interest rate.
What is a Certificate of Deposit (CD)?
This term describes any money taken out of your gross pay, including taxes, insurance, and retirement contributions.
What are deductions?
This is the annual deadline for filing federal income taxes in the United States, unless it falls on a weekend or holiday.
What is April 15th?
A student chooses between investing $1,000 now or spending it on a vacation. If they choose the vacation, they lose the potential growth of that investment. This lost opportunity is called this.
What is opportunity cost?
A student earns $2,000 per month and follows the 50/30/20 rule. Their fixed expenses total $1,200. Based on this rule, are they staying within the recommended budget for needs, and explain why.
What is no, because 50% of $2,000 is $1,000, and their fixed expenses ($1,200) exceed the recommended amount for needs?
This type of account typically combines features of checking and savings, may offer interest, and often allows limited check-writing privileges.
What is a money market account?
A student earns $10,000 in taxable income in Massachusetts. If the state income tax rate is 5%, how much state tax will they owe?
What is $500?
(10,000 × 0.05 = 500)
A taxpayer earns $50,000 and qualifies for a $15,750 standard deduction. This is the amount of income that will actually be taxed.
What is $34,250?
(50,000 − 15,750 = 34,250)
If you write a check for more money than you have in your account, this situation is called this and may result in fees.
What is a bounced check (or insufficient funds)?