Make the money, don't let the money make you.
MAKING MONEY
MAKING MONEY
What is debt?
When you owe money to somebody or something
What allows you access to the bank's money?
credit cards
When you pay a company a small amount of money each month so in the event of something bad happening, they will cover the cost of that event
Insurance
Fill in the blank.
In order to grow your networth, you must spend ______ than you make.
LESS
Investing is a borderline guaranteed way to get _____ money.
FREE
What is it called when a bank or person gives you money but you have to pay them back later?
Loans
Fixed expenses are something that are roughly the same each month like rent, car payments, and phone bills.
What are variable expenses, and what is an example of one?
Variable expenses are things that you don't always spend money on, or they change each month.
Examples include Christmas, a birthday, vacations, gas, groceries, personal care products, clothes
What is the name of the loan used to buy a house?
Mortgage
What is automation?
Setting it up so that money is automatically put into your savings account, making saving mindless and easy.
The word used for not "putting all your eggs in one basket."
Diversify
Active income vs. Passive income
Active: income that comes from you working for it
Passive: income that does not require everyday action
What are the first things your money should go towards?
Needs: food, water, shelter, transportation (if needed)
What is the money called that you owe the government for the services they provide?
taxes
Money that is accessible and easy to move around is known as being ________.
Liquid
Is it a good idea to start investing while you are paying off debt? Explain.
You should NOT begin investing money while you still owe money to others. Handle your basics before doing extra. Pay debt, pay bills.
How would you feel if you loaned your friend $100 dollars, and instead of paying you back when they had the money, they bet it on a basketball game?
What is a side hustle?
What is a reason someone might have one?
Give an example of a side hustle
Side hustles are ways to create extra income on top of their primary income.
People may start doing a side hustle to achieve a savings goal, avoid going into debt, fund vacations, follow a passion
Examples include: driving uber, shipt, making and selling art, photography, door dash
What is the name for the number that measures how well you manage debt?
Credit Score
What are the 3 most important types of insurance?
Health, car, home (or renters)
How do you make sure that an unexpected life expense such as a flat tire or broken furnace don't result in you spiraling into debt?
Create an emergency fund.
With an emergency fund you don't need to be constantly worried about things going wrong, you are able to handle them and just deal with things as they come up.
When can you retire?
You can retire when you reach a financial point that you no longer need your job to pay for your expenses.
Retirement is NOT an age, it is a financial number.
What are 2 differences between jobs and careers?
Jobs are short term, used to meet short term money goals, purpose is survival, not necessarily something that is enjoyable
Careers are long term, often connected to life goals, something you're passionate about, gives you purpose, offers opportunities to gain responsibility and get promoted, generate more money in the long run
How do banks benefit if your credit card holds a balance?
If your card holds a balance, the bank is making money off you.
You need to pay the bank back for the money you spent that month. If you don't pay back the full amount, the bank charges you interest as a "price" for using their money. Interest is a percentage of the balance on the card.
Name 3 things that can affect the cost of car insurance?
Cost of car
Type of car
Car color
Driver's age
Driving record
Amount of coverage purchased
Company used
Necessary bills are not a choice, they are things we need and can't browse around and get the best price. Examples include trash, water, gas, electric, property taxes.
What are unnecessary bills and what are 2 examples?
Unnecessary bills are for services that you choose and you are often able to browse providers. Examples include internet, streaming services, cell phone.
What is a mutual fund and what is the benefit of them?
Mutual funds are professionally blended mixtures of stocks and bonds, they automatically diversify your money and the risk level can be adjusted based on your goals.
More stock and less bonds increases risk. More bonds and less stock lowers risk.