28.2 Personal Budgets

Front

What is a variable expense?

Back

An expense that changes from month to month, such as groceries or entertainment.

Front

What is income?

Back

The amount of money earned over a period of time, typically from a job or investments.

Front

What is a fixed expense?

Back

An expense that remains constant each month, such as rent or mortgage payments.

Front

What is a budget?

Back

A plan that is used to determine how money will be spent over a specific period.

Front

Is a paycheck from a job a fixed expense?

Back

False, a paycheck is income, not an expense.

Front

What percentage of Robert's budget is allocated to fixed expenses if it is 60%?

Back

60% of his total budget is allocated to fixed expenses.

Front

Give an example of a variable expense.

Back

Examples include dining out, entertainment, and clothing.

Front

Give an example of a fixed expense.

Back

Examples include rent, mortgage, and insurance premiums.

Front

What is the difference between fixed and variable expenses?

Back

Fixed expenses do not change month to month, while variable expenses can fluctuate.

Front

Why is it important to create a budget?

Back

To manage finances effectively, track spending, and save for future goals.