Budgeting Basics
What is a budget?
A plan for how to save and spend your money
Why is it a good idea to save up some money?
In case of emergency or saving up for something you want to buy
What is Credit?
Money you borrow and your promise to pay it back
What is the difference between a "need" and a "want"
Needs are essential for survival, wants are not
What is an example of something you could start saving for right now?
A car, college tuition, a new computer, a bike, etc etc etc
What is a common way for people to track their spending?
Using an app or a spreadsheet
What is a good percentage of money to put in savings each month?
10-20%
What is a credit score?
This number represents your trustworthiness with borrowed money
Even if something is on sale, why might it still not be a smart money move to buy it?
It isn't part of your budget, or it is just unnecessary.
What are student loans, and how are they affected by interest?
Loan for education that builds interest over time
What is the first step in creating a budget?
Knowing your income and spending
What is an emergency fund, and why should you have one?
Savings set aside for unexpected expenses
Why would somebody buy something on credit?
Big purchases like a car or a house
What can you use to "buy now, pay later", but can lead to debt if not used properly?
Credit Cards
Financial Aid can be loans, grants, or scholarships, and help you through college so you don't have to pay out-of-pocket.
Name a common expense that changes month to month
Groceries, Utilities, Gas, Medical, etc etc etc
What is a "Savings Goal", and why is it helpful?
This is a target for saving. Helps to keep you motivated and focused
What is one good way to build credit?
These types of purchases, often made on a whim without planning, can lead to overspending and financial regret.
Impulse Buying
What is the difference between a "Grant" and a "Loan" for college?
Grants are free money from the government, and loans are paid back over time.
What is the term for the Total amount you earn before taxes are taken out?
Gross Income
If you earn $100 a week, how much should you save each week to reach a savings goal of 20%?
$20
What does it mean if you have "high interest rate" on a credit card?
You will pay more money over time to pay off the card.
What is a spending plan, and how is it different from a budget?
A spending plan is a more flexible plan, focused on making good choices with extra money.
This is a term for an item, like stocks or real estate, that you buy now with the hope that it will grow in value over time
Investments