Budgeting Terms Set 1

Front

What are expenses?

Back

Items or services you pay for such as rent, groceries, entertainment, bills, etc.

Front

What is a deduction?

Back

Any items subtracted from your paycheck, including state and federal income taxes, Social Security, health insurance or 401(k) contributions.

Front

What is gross pay?

Back

Total earnings before any deductions are taken.

Front

What is budgeting?

Back

The process of planning and managing your income, expenses, and savings to achieve financial goals.

Front

What is the cost of living?

Back

The amount of money needed to sustain a certain level of living, including basic expenses such as housing, food, taxes, and healthcare.

Front

What are fixed expenses?

Back

Regular, recurring expenses that do not change in amount, such as rent or mortgage payments.

Front

What is net pay?

Back

The amount of money you take home after all deductions are made from your gross pay.

Front

What is a budget?

Back

A plan that outlines expected income and expenses over a specific period.

Front

What is a financial goal?

Back

A specific objective that requires financial planning, such as saving for college or buying a house.

Front

What is discretionary spending?

Back

Non-essential expenses that can be adjusted or eliminated, such as dining out or entertainment.