Personal Budget

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What is a personal budget?

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A personal budget is a plan that outlines an individual's expected income and expenses over a specific period, helping to manage finances effectively.

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What is the purpose of saving a percentage of income?

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Saving a percentage of income helps individuals build financial security, prepare for emergencies, and plan for future goals like retirement.

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What are fixed expenses?

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Fixed expenses are costs that do not change from month to month, such as rent or loan payments.

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What are variable expenses?

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Variable expenses are costs that can change from month to month, such as groceries or entertainment.

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How do you calculate a percentage of income?

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To calculate a percentage of income, divide the amount by the total income and multiply by 100.

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If Ryan makes $5,000 a month, how much is 15% of his income?

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$750

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What is the difference between fixed and variable expenses?

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Fixed expenses remain constant, while variable expenses fluctuate based on usage or consumption.

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How do you determine what percentage of income goes to transportation costs?

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To determine the percentage, add all transportation costs, divide by total income, and multiply by 100.

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What is the formula for calculating rent as a percentage of income?

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(Rent Amount / Total Income) x 100.

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What is an example of a fixed expense?

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An example of a fixed expense is a monthly mortgage or car payment.