Financial goals
What are short-term financial goals?
Short term goals include an emergency fund, paying off debt, or saving for major purchases.
What does the 50/30/20 rule represent?
50% is needs, 30% is wants, and 20% is savings/debt
What's a good starting goal for an emergency fund?
$500 to $1000
What's the avalanche method of paying debt?
Paying off debts with the highest interest rate first.
What's one type of insurance millennials should consider?
Health, renters, life, or disability insurance.
What is one benefit of setting financial goals?
One benefit is it provides direction for decisions and reduces stress or helps prioritize spending/saving,
How much goes to "Wants" if income is 4,000?
1,200
What's the long term goal for an emergency fund?
3-6 months
What's the snowball method to paying off debt?
Paying the smallest balance first, so it could create motivation
Why should you freeze your credit?
To protect yourself against identity theft especially if you're not applying for loans.
Name one mid-term goal
Buying a home, starting a business, or further your education
What are two examples of "Needs"?
Rent, groceries, utilities, insurance
Why keep emergency funds in a separate account?
It reduces your temptation to spend it and keeps the funds safe.
What's one way to invest for retirement?
Open a Roth IRA, Traditional IRA, or contribute to 401 (k)
What legal document should you have if you have assets or kids?
A will (with beneficiaries)
What's a common long-term financial goal?
Retirement or financial independence
What falls under "Savings and Debt Repayment"?
Emergency fund, retirement savings, student loans.
Give an example of an emergency expense.
Medical bills, car repairs, or losing your job.
A benefit of refinancing debt?
It can lower your interest rate.
How can you improve or protect your credit score?
Pay bills on time, use your credit wisely, and protect your identity.
How do financial goals reduce stress?
They help you prioritize spending and saving, reducing uncertainty.
Why stick to a budget?
To manage spending, reduce debt, and prepare for goals.
How to build an emergency fund over time?
You treat it like a bill and contribute to it monthly.
What's a good way to start investing?
Use ETF's, index funds, or investing apps.
Why evaluate your financial plan quarterly?
To adjust your budget/debt strategies as life changes.