Income
Money earned from a job, allowance, or side hustle like babysitting or mowing lawns.
What is Income?
Food, shelter, and basic clothing fall into this category.
What are needs?
Rent or a monthly phone plan is an example of this type of expense.
What is a fixed response?
in the 50/30/20 rule, this percentage of income is for needs.
What is 50%
Choosing to save money instead of buying something right away is an example of this.
What is delayed gratification?
This type of income stays the same each pay period, such as weekly allowance.
What is fixed income?
Video games, concert tickets, and designer shoes fall into category.
What are wants?
Grocery bills and gas costs are examples of this type of expense.
What is variable expense?
Wants take up this percentage of income in the 50/30/20 rule.
What is 30%
When you can't afford everything, you want you must make this type of choice.
What is a trade off?
Money earned from tips, overtime, or bonuses that can change each month.
What is variable income?
Choosing groceries instead of eating out shows prioritizing this category.
What are needs?
This expense usually stays the same amount each month.
What is fixed expense?
Savings and debt payments make up this portion of the 50/30/20 rule.
What is 20%
Buying a used item instead of a new one to save money is an example of this.
What is a smart budgeting decision?
A paycheck amount after taxes have been taken out.
What is net income?
Treating wants as if they are necessities is an example of this financial mistake.
What is confusing needs and wants?
This expense can change depending on usage or choices.
What is a variable expense?
If you earn $500 a month, this amount should go to savings using the 50/30/20 rule.
What is $100?
Spending more money in one category usually means less money for this.
What is another category?
If you earn $12 an hour and work 10 hours, this is the money you earn before taxes.
What is gross income?
Buying the newest phone even though your current one still works is an example of this.
What is want?
Sorting spending into these two groups helps make a better budget.
What are fixed and variable expenses?
This budgeting method helps balance needs, wants, and savings.
What is the 50/30/20 rule?
Comparing costs and benefits before making a purchase helps avoid this problem.
What is overspending?