Category 1: Budgeting Basics
$100: This is the specific amount of money you take home after taxes and deductions are removed from your gross pay.
Answer: What is Net Pay?
$100: This strategy involves placing physical cash into labeled paper containers to strictly control spending for different categories.
Answer: What is the Envelope Method?
$100: This is the most effective way for a recent graduate like Libby to drastically reduce her monthly rent and utility costs.
Answer: What is having roommates?
$100: People living in this type of low-density area usually depend almost entirely on personal vehicles rather than public transit.
Answer: What is a Rural Area?
$100: To save the most money on food, you should do this instead of dining out or buying pre-made snacks.
Answer: What is cooking at home?
$100: If your monthly net pay is $2,500 but your expenses are $2,625, you must do one of these two things.
Answer: What is cut spending or find more income?
$100:Question: If Isaiah is paid $3,000 before any taxes or Social Security are deducted, this is the specific term for that total amount.
Answer: What is Gross Pay?
$200: This budgeting philosophy advises you to assign every single dollar of your income to a specific category until you have $0 left over.
Answer: What is a Zero-Based Budget?
$200: An expense that stays the same every month, such as rent or a car payment, is known as this.
Answer: What is a Fixed Expense?
$200: When signing this legal agreement, you usually need to provide a security deposit and the first and last month's rent.
Answer: What is a Lease?
$200: Beyond the monthly loan payment, gas, and insurance, a car owner must also budget for these two unpredictable costs.
Answer: What are Maintenance and Emergency Repairs?
$200: You should calculate this to determine if a 16 oz box of cereal for $3.20 is a better deal than a 32 oz box for $5.00.
Answer: What is the Unit Price?
$200: When asking if a new laptop is a "need," this is the most irrelevant question to ask.
Answer: What is "Which model is trendy right now?"
$200: Question: This is the common name for "Net Pay," representing the actual amount of money that hits your bank account on payday.
Answer: What is Take-Home Pay?
$300: This "rule of thumb" suggests allocating 50% of your income to needs, 30% to wants, and 20% to savings and debt repayment.
Answer: What is the 50/30/20 Rule?
$300: This type of expense, like a utility bill or grocery trip, changes in cost from month to month.
Answer: What is a Variable Expense?
$300: To avoid paying Private Mortgage Insurance (PMI) when buying a home, it is a "good rule of thumb" to provide this percentage as a down payment.
Answer: What is 20%?
$300: This is a valid reason to choose a personal car over public transit, even if it is more expensive.
Answer: What is a significantly shorter commute time? (e.g., 2 hours vs. 30 mins)
$300: This cereal has the lowest unit price: $3.20/16oz, $5.00/32oz, or $2.50/10oz.
Answer: What is Cereal B? ($0.156 per oz)
$300: If you are consistently $175 over budget, this is the smartest first step to take.
Answer: What is cutting small "wants" (like streaming or dining out)?
$300: Question: This is a sum of money held by a landlord during a lease to cover potential damages to the property.
Answer: What is a Security Deposit?
$400: This three-word phrase describes the habit of putting money into savings as soon as you get paid, rather than waiting to see what is left at the end of the month.
Answer: What is "Pay Yourself First"?
$400: This digital tool allows you to sync bank accounts and categorize spending automatically, though it may come with a subscription fee.
Answer: What is a Budgeting App?
$400: Of these four—Rent, Car Loan, New Clothes, or a Big Screen TV—this one is the most difficult to adjust quickly if you need to reduce expenses.
Answer: What is a Car Loan? (It is a fixed legal contract).
$400: For a college grad moving to a new city, this transportation factor is the least important compared to rent or job location.
Answer: What is the average cost of ride-sharing (Uber/Lyft)?
$400: This is a list of items you plan to buy, created before entering the store to avoid impulse purchases.
Answer: What is a Grocery List?
$400: This is the first step in creating a budget, as it helps you determine your priorities and how to proportion your funds.
Answer: What is setting financial goals?
$400: Question: This is the cost per a specific measure (like an ounce or gram), which allows you to compare the value of different-sized packages.
Answer: What is Unit Price?
$500: While high-priced items are often at eye level, savvy budgeters look here to find lower-cost alternatives.
What are the top and bottom shelves?
$500: If you earn $40,000 gross per year and save 20%, it will take this many years to reach an emergency fund goal of $16,000.
Answer: What is 2 years? ($40,000 × 0.20 = $8,000/year; $16,000 ÷ $8,000 = 2)
$500: Libby wants to spend 40% of her $3,104 take-home pay on an apartment. This is the dollar amount she is suggesting (which experts say is too high).
Answer: What is $1,241.60?
$500: This is the financial "trap" of cars that Libby is ignoring; it refers to the loss of the car's value over time.
Answer: What is Depreciation?
$500: This is why both Danaisha (spending $325) and Charles (spending $195) can both be "correct" in their budgeting.
Answer: What is because "needs vs. wants" are determined on an individual basis?
$500: To ensure a budget stays effective, you should revisit and adjust it whenever this happens.
Answer: What is a major life change? (e.g., marriage, moving, new job)
$500: Question: This term refers to money given to a charity or a cause, which should only be added to a budget if there is a surplus of income.
Answer: What are Philanthropic Donations?
$800: This habit involves setting aside a fraction of your paycheck for savings before you spend a single cent on anything else.
Answer: Paying yourself first
$800: Identify one advantage and one disadvantage of using a budgeting app.
Answer:Adv: easy access/auto-sync; Disadv: privacy/subscription fees)
$800: Beyond the loan payment, gas, and insurance, a car owner must budget for these two unpredictable costs.
Answer: Maintenance and Emergency Repairs
$800: Explain how unit pricing helps you save money and name one challenge to calculating it.
Answer: Strips away brand/size influence; Challenge: no standard measurement unit
This term refers to money given to a charity or a cause.
Answer: Philanthropic Donation
$800: Daily Double: Why is paying only the "bare minimum" on student loans a bad long-term budgeting strategy?
Answer: You will accrue more interest and pay significantly more over the life of the loan
$800: The "Gross vs. Net" Reality Check
Question: If Libby earns a $50,000 salary but her take-home pay is only $3,104/month, approximately what percentage of her gross pay is being "lost" to taxes and deductions?
Answer: What is 25.5%?
The Simple Breakdown:
Find Yearly Take-Home: Multiply the monthly pay by 12.
3. Find the Percentage: Divide the deductions by the gross salary.
$1000: The following situations is an example of ______ pay.
Timothy multiplies his hourly wage by his total hours worked then subtracts taxes and deductions
Answer:What is an example of net pay.
$1000: Libby needs some help with getting her financial priorities straight. Address Libby’s statement below and provide one tips that she can use to budget appropriately during this exciting part of her life. Be sure to keep in mind her monthly take-home pay of $3,104.
Answer: On keeping a budget:
$1000: Libby needs some help with getting her financial priorities straight. Address Libby’s statement below and provide one tips that she can use to budget appropriately during this exciting part of her life. Be sure to keep in mind her monthly take-home pay of $3,104.
Answer: On housing:
$1000: Libby needs some help with getting her financial priorities straight. Address Libby’s statement below and provide one tips that she can use to budget appropriately during this exciting part of her life. Be sure to keep in mind her monthly take-home pay of $3,104.
Answer:On transportation:
$1000: Libby needs some help with getting her financial priorities straight. Address Libby’s statement below and provide one tips that she can use to budget appropriately during this exciting part of her life. Be sure to keep in mind her monthly take-home pay of $3,104.
Answer: On food:
$1000: Libby needs some help with getting her financial priorities straight. Address Libby’s statement below and provide one tips that she can use to budget appropriately during this exciting part of her life. Be sure to keep in mind her monthly take-home pay of $3,104.
Answer:On entertainment:
$1000: This is the term for a car's loss of value over time, a cost many people forget when budgeting for a vehicle.
Answer: Depreciation