Budgeting
What is a budget?
A plan for how to spend and save money.
Why is saving important?
To prepare for emergencies or future goals.
What is credit?
Borrowed money that you agree to repay
What does SMART stand for in SMART goals?
Specific, Measurable, Achievable, Relevant, Time-bound
What does ATM stand for?
Automated Teller Machine
What’s the difference between a need and a want?
Needs are essential; wants are not
What is a savings account?
A bank account that earns interest on money saved
What is a credit score?
A number that shows how likely you are to repay debt
Why is setting goals important?
It gives you a plan and motivation
What’s safer: saving in a bank or under your bed?
A Bank
If you earn $50 and spend $40, what is your surplus?
$10
What is the 50/30/20 rule?
50% needs, 30% wants, 20% savings
What affects your credit score?
Payment history, credit usage, length of credit, etc.
What’s a short-term goal?
A goal you want to reach soon (e.g., in 3 months)
Name one thing banks do
Hold money, give loans, offer accounts
Name two types of expenses.
Fixed, variable
What is interest?
Money earned on savings or paid on loans
What is interest on a credit card?
A fee charged for borrowing money
What’s a long-term goal?
A goal that takes a year or more to reach
What’s one way to earn money as a student?
Babysitting, lawn care, selling crafts, etc.
What is the first step in creating a budget?
Tracking your income and expenses
What’s one way to make saving automatic?
Direct deposit or auto-transfer to savings
rue or False: Having a credit card means you’re rich.
False
Give an example of a SMART financial goal.
Save $100 in 6 months by saving $5 per week.
What is a paycheck deduction?
Money taken out for taxes or benefits