Needs vs. Wants
This type of expense is required for survival, like food and water.
What is a need?
This percentage of income should go toward needs.
What is 50%?
The general sales tax rate in Pennsylvania is this percent.
What is 6%?
A plan for how to spend and save money is called this.
What is a budget?
Buying ownership in a company is called buying this.
What is stock?
Buying the latest shoes just because they’re trendy is an example of this.
What is a want?
Savings are recommended to take up this portion of your income.
What is 20%?
A $50 item has this amount of sales tax.
What is $3.00?
If expenses are greater than income, this type of balance occurs.
What is a negative balance?
Money earned from investments is called this.
What is profit or return?
A student replaces their broken backpack so they can carry school supplies safely. This is classified as this.
What is a need?
If someone earns $200, the amount for wants using the rule is this.
What is $60?
Items like most clothing and food are usually in this tax category.
What is non-taxable?
This is one major benefit of tracking your expenses.
What is avoiding overspending?
This type of investment spreads money across many assets to reduce risk.
What is a mutual fund?
Ordering delivery pizza every night because “cooking is too hard” falls under this category.
What is a want?
A student spends 70% of their money on wants—what part of the 50/30/20 rule are they violating?
What is overspending on wants?
A $100 purchase includes this total tax amount.
What is $6.00?
Name one expense category besides needs and wants.
What are savings?
A stock purchased for $250 increases in value to $400. The profit is this amount.
What is $150?
Explain why distinguishing between needs and wants is important when creating a budget.
It helps prioritize essential spending before non-essential purchases.
Why is the 50/30/20 rule considered a helpful guideline rather than a strict law?
It provides structure but can be adjusted based on individual needs.
Explain how knowing sales tax helps you when shopping.
It helps you predict the real total cost before buying.
Explain what someone should do if their budget shows a negative balance.
Reduce expenses or increase income to balance it.
Why is long-term investing usually considered safer than short-term investing?
It allows time to recover from market changes and grow your money.