Inflation
How do high interest rates slow inflation
by making borrowing more expensive which slows down consumer and business spending.
When a business buys equipment using cash, which account is debited?
Equipment.
Where is my money going exactly every week?
you must track spending, review bank statements, and categorize expenses
What is the difference between saving and investing?
How much should I save for retirement?
Ideally, aim to save 15% of your annual salary. If that is not possible, try to contribute at least enough to get your employer's full 401(k) match.
Are companies using inflation to increase profits
Evidence suggests some companies are using high-inflation environments to increase profit margins beyond rising costs
Which accounts normally have debit balances?
Assets, Expenses, and Losses.
What is the absolute minimum I need to cover housing, food, and utilities?
$1,300–$1,600 per month
What is the best way to start investing?
Start with a workplace retirement plan like a 401(k), especially if they offer a company match, which is free money.
What is the "50/30/20" rule?
A budget method where you allocate 50% of your after-tax income to necessities (rent, food), 30% to wants (hobbies, travel), and 20% to savings or debt repayment.
Why is there a 2% target?
to anchor inflation expectations, encourage economic growth, and avoid the dangers of deflation
Which accounts normally have credit balances?
Liabilities, Equity, and Revenue.
which expenses are true needs versus wants, and how can I cut the wants?
involves using a 50/30/20 budget, tracking spending, implementing a 24-hour rule before buying, and automating savings.
What is an emergency fund?
An emergency fund is a pool of cash meant for unexpected expenses like medical bills, car repairs, or job loss.
How much do I need in an emergency fund?
A generally recommended amount is three to six months of essential living expenses, held in a liquid, easily accessible account.
How does current inflation affect my purchasing power or the value of my salary?
Current inflation reduces your purchasing power by making goods and services more expensive, meaning your money buys less
What does normal balance mean?
It is the side (left/debit or right/credit) that increases an account
How do I manage "fun" money on a tight budget so I don't feel restricted and break my budget?
amount each paycheck into a separate account or envelope for guilt-free spending
What is the difference between compound interest and simple interest?
How can I reduce my income taxes?
Explore options like maximizing contributions to retirement accounts (like 401(k) or IRA) and taking advantage of tax-advantaged accounts like HSAs
How do Federal Reserve interest rate hikes specifically slow down inflation?
Raising borrowing costs for consumers and businesses
What is the fundamental rule for debits and credits
They are opposite and equal, representing a transfer of value.
Am I paying myself first saving at least a small amount every paycheck?
Paying yourself first means prioritizing savings by automatically transferring 10%-20%
What are common investment vehicles?
Should u buy a home or rent?
The decision depends on factors like your ability to afford a down payment, how long you plan to stay in one location, and your personal financial stability.