Personal Finance- Budgeting

True or False. When developing a budget, it is a good idea to “pay yourself first,” by saving a percentage of your paycheck before deciding how much money you have left to spend.

• True

• False

Which of the following items will not be seen on a pay stub?

• Gross Pay

• Net Pay

• Mortgage Insurance/Renters Insurance

• Medicare

You are putting together your first budget after graduating from college. Your take-home or net pay from your job will be $2,500 per month. You estimate your monthly costs to be rent of $800, car payment of $350, car insurance of $150, car maintenance of $50, entertainment of $500, food expense of $250, mobile phone of $100, cable bill of $75, personal car expenses of $100 and other expense of $300. How would you describe your budget after analyzing all of your income and expenses?

• You have a surplus of $175

• You have a deficit of $175

• You have a balanced budget

• You have a deficit of $2,675

• You have a surplus of $2,500

Which of the following is not a purpose for a budget?

• To use as a tool for decision making

• To tell you how much you will be paid

• To help you manage and allocate your money

• To let you know how much money you can spend for a particular purpose

When putting together your personal budget, you find that your budget has a DEFICIT. Indicate the action that you need to take to balance your budget.

• Increase your income and expenses by the same amount

• Cut your expenses by an amount greater than your deficit

• Increase your expenses by more than your deficit

• Increase spending on your needs

What deductions can be taken out of your paycheck prior to you receiving the money?

• Money you owe your employer after you broke something

• State Tax

• Social Security Tax

• Federal Tax

Caitlin works at the local store. She works from 3pm - 7pm on Monday and Wednesday and each Saturday morning from 9am - 1pm. She gets paid $10 per hour. What will be Caitlin's weekly net (or take home) pay?

• Exactly $120

• More than $120

• Less than $120

True or False: Be sure that your WANTS are met first before you set aside money for your NEEDS.

• True

• False

True or False: Keep your expenses less than your income so that your budget will be in surplus.

• True

• False

True or False: Only consider what to save at the end of the month after you know how much you have left over.

• True

• False