True and False
People's values are reflected in how they spend their money
True
A detailed plan allocating money for specific purposes
Budget
"First-fruits giving" is tithing on this
Gross Pay
For the purpose of preparing a budget, income is considered any money you expect to recieve
True
Explain the envelope system of sticking to your budget
A budget is balanced when total income equals total expenses.
True
Often called "take-home-pay"
Net Pay
When planning for the use of money, these must come first
Needs
Saving for emergencies can reduce the impact of a financial setback
True
Explain how a budget provides 'freedom within safe bounds'.
Your income establishes the boundaries, and you have freedom within those boundaries to determine how to use your money.
Unlike a savings strategy to achieve a goal, a budget is not flexible.
False
These expenses remain the same from one budget period to the next.
Fixed expenses
The type of expenses over which you have the most control
Variable Expenses
True
Explain how you would budget for a quarterly periodic expense (Quarterly means the bill comes due four times a year or every three months)
Save one-third of the bill each month for a quarterly bill so you can have the money on hand when the bill comes due.
The gross amount of a paycheck is used to determine income on a budget.
False
On a budget, this section is shown first
Income
What a person esteems as important
Values
Wealth is a sure sign of God's favor
False
Explain the concept of PYS (Pay yourself second)
PYS is saving for long term future goals and needs. PYS is a method of saving regularly each budget period.
In a budget, needs are listed as fixed expenses; wants are listed as variable expenses.
False
The length of time a budget covers.
Budget Period
Expenses that recur at regular intervals other than the length of the budget period
Periodic Expenses
A financial plan isn't meant to be carved in stone; it is a flexible tool that can be changed as circumstances change
True
Why might income be shown as 'estimated' on a budget?
Irregular work hours; weather dependent or seasonal jobs; irregular income sources; income based on commission