Budget

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What is a fixed expense?

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A fixed expense is a cost that does not change from month to month, such as a cell phone bill or rent.

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What is a variable expense?

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A variable expense is a cost that can fluctuate based on usage or consumption, such as groceries or gas.

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What does 'pay yourself first' mean?

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It means to allocate a portion of your income to savings before spending on other expenses.

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What is the first step in creating a budget?

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The first step is to know your income.

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What are financial goals?

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Financial goals are specific objectives that individuals set to achieve financial stability or growth.

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What is the difference between fixed and variable expenses?

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Fixed expenses remain constant each month, while variable expenses can change based on consumption.

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Why is it important to review your budget periodically?

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Reviewing your budget helps you track your spending, adjust for changes in income or expenses, and stay on target with your financial goals.

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What is discretionary spending?

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Discretionary spending refers to non-essential expenses, such as entertainment or dining out.

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What is the purpose of a budget?

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A budget helps individuals plan their finances, control spending, and save for future goals.

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How can setting financial goals impact budgeting?

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Setting financial goals provides direction and motivation for budgeting, helping individuals prioritize their spending.