BUDGET SMART
This is a plan that shows how much money you expect to receive and how you plan to spend it.
What is a budget?
This is money set aside for unexpected expenses.
What is an emergency fund?
This is the amount you agree to borrow on a credit card and repay later.
What is credit?
This is money you borrow to help pay for college and generally must repay.
What is a student loan?
This means putting money aside with the goal of increasing its value over time.
What is saving?
Rent, groceries, transportation, and your phone bill are examples of these types of expenses.
What are needs/essential expenses?
If you receive $500 and immediately put $50 into savings before spending the rest, you are practicing this strategy.
What is paying yourself first?
The most important habit for building a positive credit history is doing this on time.
What is making payments on time?
Before accepting a loan, you should know these three things: how much you owe, the interest rate, and this.
When/how you will have to repay it (including the payment terms).
True or False: Starting to save early can give your money more time to grow.
True.
You make $1,500 per month. Your expenses are $1,700. What is the problem?
You are spending more than you earn.
True or False: You need thousands of dollars before starting an emergency fund.
False. Starting with even $25–$50 is better than not starting.
You have a $500 credit limit. Should you spend the entire $500 simply because it's available?
No. Your credit limit is not extra income.
Why is having good credit important after college?
It can help when applying for housing, loans, and other credit, and can potentially lead to better borrowing terms.
What is one advantage of keeping an emergency fund in a savings account instead of spending all your money?
You have money available for unexpected expenses.
You spend $8 on coffee three times a week. Approximately how much could that cost you in one month?
About $96.
Name one expense that an emergency fund could help cover.
Unexpected car repairs, medical expenses, emergency travel, loss of income, etc.
A student wants to build credit through STPFCU. Name one type of credit card they could potentially use if they don't qualify for a traditional card.
What is a secured credit card?
Name two financial goals a college student could set before graduation.
Examples include building savings, establishing good credit, reducing debt, creating a budget, or saving for a car/apartment.
If you receive a raise, name one smart thing you could do with part of the additional money.
Increase savings, pay down debt
Your friend says, "I have a $1,000 credit limit, so I have $1,000 to spend." What is wrong with this statement?
A credit limit isn't a budget. You should only spend what you can afford to repay.
Put these savings goals in a reasonable order: $1,000 emergency fund, $100 starter savings, 3–6 months of expenses.
$100 starter savings → $1,000 emergency fund → 3–6 months of expenses.
You charge $300 on your credit card but can only afford to pay $50. What could happen if you regularly carry balances you can't afford?
You can accumulate debt and interest, making it harder to manage your finances.
You graduate with $2,000 in savings, a good credit history, a manageable amount of student debt, and a working monthly budget. What is the biggest financial advantage you have?
You have created a strong financial foundation for life after college.
You have $1,000 in savings, but you don't have a specific purpose for it. What is one smart step you can take to make sure you continue building your savings?
What is setting a savings goal and making regular automatic deposits into your savings account?