Zero-Based Budgeting

What are two reasons why having a budget is beneficial? (select two)

• It helps you focus on and achieve financial goals.

• It eliminates the need to monitor your finances.

• It reveals spending patterns and helps prevent overspending.

• It guarantees your financial success.

Todd wants to create a zero-based budget. The first thing he should do is...

• Write down all sources of monthly income.

• Set aside at least 30% of income for savings.

• Create a list of anticipated monthly expenses.

• Track his spending throughout the next month.

After Todd writes down all sources of income for the month, he should create a list of all monthly...

• savings goals

• investments

• wants

• expenses

When Todd finishes writing down his anticipated income and expenses, he should also note ___ that he should start to save for.

• his biggest wants

• irregular expenses

• stocks and bonds

Now that Todd has created his budget, what should he do next?

• Ignore it and start spending all his income.

• Set it aside for 3 months and return to it later.

• Make sure it works perfectly or start over.

• Track his spending and adjust the budget.

According to this method of budgeting, Todd's monthly income minus his monthly expenses should equal what?

• 500

• 100

• 50

• 0