Lesson 1
A plan to manage income and expenses
A budget.
The money you earn regularly, such as wages or salary
Income
The money left after all expenses are paid.
Net income
This shows how much money comes in and goes out of your financial life.
Cash flow.
Store money securely and earn interest at a bank.
Savings account
An account for emergencies that earns interest
A savings account
A required payment to the government taken from your income
Taxes
Expenses that change each month.
Variable expenses.
This is everything you owe, including loans and credit card debt.
Liabilities
A credit card is an example of this type of credit
Crédito Rotativo.
Steps to solve problems and choose
Decision-making process
This document shows your earnings and deductions.
A pay stub
This strategy involves spending no more than you earn by assigning every dollar to a category
Zero-based budgeting.
These types of expenses stay the same every month, like rent and insurance
Fixed expenses
Small loans for entrepreneurs or small businesses
Microcrédito y PYMES.
When prices rise over time
Inflation
Your ability to increase income over time
Earning potential.
What are the four main categories of expenses in a budget?
Fixed, variable, discretionary, and periodic.
To determine your net worth, subtract your liabilities from this
Assets
Credit that requires collateral, like a car or property.
Crédito Garantizado.
How rising interest rates affect borrowing
Higher rates make loans more expensive.
Income earned from investments, like stocks or rental properties.
Passive income.
This method helps you identify your priorities by evaluating how you spend money.
The 50/30/20 rule
The formula to calculate net worth
Assets minus liabilities.
Long-term credit for buying a home.
Crédito Hipotecario.