Budgeting

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What is budgeting?

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Budgeting is the process of creating a plan to manage income and expenses over a specific period, helping individuals allocate their resources effectively.

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What is the most expensive category in a person’s budget?

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Housing is generally the most expensive category in a person’s budget.

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What type of expense is car insurance?

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Car insurance is a fixed expense, meaning it does not change from month to month.

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What is a paycheck an example of?

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A paycheck is an example of a deposit, as it adds money to an individual's account.

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Why is budgeting important?

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Budgeting is important because it helps individuals avoid overspending and prepares them for large expenses they may not be able to afford.

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Should needs come before wants in a budget?

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True, when making a budget, a person’s needs should come before their wants.

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What is a fixed expense?

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A fixed expense is a cost that does not change over time, such as rent or insurance.

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What is a variable expense?

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A variable expense is a cost that can change from month to month, such as groceries or entertainment.

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What is the purpose of a budget?

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The purpose of a budget is to track income and expenses, ensuring that spending does not exceed income.

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What is an example of a need?

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An example of a need is food, as it is essential for survival.