Budgeting Basics
What budgeting model divides income into 50% needs, 30% wants, and 20% savings and debt repayment?
What is the 50/30/20 budgeting model
What is money spent on goods and services called?
What are expenses
What is the first step of the IDEAL Purchase-Making Model?
What is Identify the problem, need, or opportunity
What is the next-best alternative you give up when making a decision called?
What is opportunity cost
What is money set aside for unexpected expenses called?
What is an emergency fund
If you earn $2,000 per month, how much should you allocate to savings and debt repayment using the 50/30/20 model?
What is $400
What is money earned before taxes and deductions called?
What is gross income
What does the letter D stand for in the IDEAL model?
What is Define the goal
What is one example of a financial need?
What is food, housing, or clothing
What is one way to protect your personal financial information?
What is using strong passwords or avoiding suspicious links
What is the money remaining after taxes and deductions called?
What is net income
What is the ability to borrow money and repay it later called?
What is credit
What IDEAL step involves researching products, reading reviews, and comparing prices?
What is Explore possible choices
What is one example of a financial want?
What is a video game, designer clothing, or a new phone when your current one works
What does it mean to be financially vulnerable?
What is being at risk of financial hardship because of limited resources or unexpected expenses
What is it called when your expenses are greater than your income?
What is a deficit
What is money owed to another person or financial institution called?
What is debt
What does the A in IDEAL encourage consumers to do?
What is Anticipate outcomes and Act
You have $100 and choose to buy shoes instead of saving for a school trip. What financial concept describes what you gave up?
What is opportunity cost
Why is having an emergency fund important?
What is having money available for unexpected expenses and reducing financial stress
If your monthly income is $3,000 and your expenses are $2,400, what is your surplus?
What is $600
What is the extra money paid when borrowing money or earned on savings called?
What is interest
After buying a laptop, you realize a cheaper model would have met your needs. Which IDEAL step are you completing?
What is Look Back and Learn
Your friends all buy expensive headphones, but you decide to save your money instead. What financially responsible behavior are you demonstrating?
What is making independent spending decisions and following a budget
Does earning a high income automatically guarantee financial well-being? Explain why or why not.
What is no, because financial well-being also depends on budgeting, managing expenses, saving, and making responsible financial decisions