Financial Literacy Chapter 2

Taxes and withholdings impact your _____________, which is the amount of money you take home on your paycheck.

• fixed expense

• net income

• budget

• gross income

To budget with a(n) ______________________, prioritize expenses from most to least important so your most important expenses are covered first.

• intermittent expense

• gross income

• cash-flow statement

• irregular income

A(n) ____________________ should account for fixed, variable, intermittent, and discretionary expenses based on income

• zero-based budget

• gross income

• commission

• income

A(n) ______________________ stays the same from month to month.

• variable expense

• fixed expense

• budget

• gross income

The cost of groceries and gas is considered a(n) ____________________.

• fixed expense

• discretionary expense

• variable expense

• commission

A(n) ___________________ needs to be evaluated in light of your other expenses for the month.

• discretionary expense

• fixed expense

• net income

• gross income

A budget doesn't tell you not to spend. A budget actually...

• makes it harder to save money.

• lets you go crazy and buy everything you want.

• gives you freedom to spend.

• has nothing to do with your income and expenses.

The three priorities in your budget, after income, are...

• giving, saving, and buying kittens.

• shopping, shopping, and more shopping.

• cash, check, or credit card.

• giving, saving, and spending.

Specific categories are important to consider when creating a budget so you can...

• figure out how to make more money.

• break down your income and spending.

• do the hokey pokey and then turn yourself around.

• spend money without knowing where it's going.

The envelope system is especially helpful for expenses like...

• food, gas, entertainment, and shopping.

• your rent or mortgage payment.