Budgeting
What is a budget and how do you set one?
A limit you set for yourself while shopping. You decide an amount which you won't exceed and spend under that limit.
What is disposable income?
The money you have left after paying taxes.
What is a debit card?
A card that takes money directly from your bank account.
Income
Money a person earns from work, gifts, or other sources.
What is a wage?
Money you earn based on the number of hours you work.
How is a monthly budget created?
A percent of your income is set aside for expenses and a specific amount is set per shopping trip.
What is discretionary income?
The money you have left after paying taxes and all necessary expenses (like housing, food, and transportation).
What is a credit card?
A card that lets you borrow money now and pay it back later.
Expense
Money that you spend to buy things or pay for services.
What is a salary?
A set amount of money you earn each year, no matter how many hours you work.
What is the difference between spenders and savers?
Spenders go broke quick, and savers have remaining money for the future.
Is buying groceries paid with disposable or discretionary income?
Disposable income, because groceries are a basic need.
Why can using a credit card cost more money than using a debit card?
Because if you don’t pay your credit card bill on time, interest and fees can be added, making your purchase more expensive.
Savings
Money you choose to set aside instead of spending right away.
What is a paycheck?
The money you receive from your job after working for a certain period.
What should you do if your expenses are higher than your income?
Reduce spending, increase income, or adjust your budget so it balances.
If your rent and food cost a lot, what happens to your discretionary income?
It gets smaller.
How can using a credit card responsibly help your financial future?
Making on‑time payments builds a good credit score, which can help you get loans, rent an apartment, or lower interest rates later.
Loan
Money you borrow that must be paid back, usually with interest.
What is the difference between gross pay and net pay?
Gross pay is the total amount you earn before taxes and deductions. Net pay is the money you actually take home after those deductions.
What is the difference between a need and a want?
A need is something essential for living (like food or housing). A want is something you’d like to have but can live without.
Is buying video games paid with disposable or discretionary income?
Discretionary income, because video games are a want, not a need.
How does using a debit card protect you from going into debt?
A debit card only lets you spend money already in your bank account, so you can’t borrow money you don’t have.
Interest
Extra money you earn when you save in a bank, or extra money you pay when you borrow.
What is overtime pay?
Extra money you earn for working more than your regular hours.