Unit 3 Savings Review

Which of the following is NOT a reason for financial planning?

• To evaluate how wisely you are using your money

• To prepare your income tax returns

• To prevent careless and wasteful spending

• To prioritize your options in order to get the most from your income

Which of the following defines a budget?

• A plan to increase income

• A plan to match expected expenses with expected savings

• Something that will decrease your wants and needs

• Spending and savings plan based on expected income and expenses

House payments (mortgages), car loans, and student loans are all examples of:

• Disposable income

• Fixed expenses

• Personal records

• Variable expenses

Shown on your net worth statement are things of value that you own, known as

• Assets

• Collateral

• Disposable income

• Liabilities

Shown on your net worth statement are debts you owe to others, known as:

• Assets

• Collateral

• Disposable income

• Liabilities

A net worth statement is calculated as:

• Assets + Liabilities

• Assets - Liabilities

• Fixed Expenses - Variable Expenses

• Liabilities = Assets

Steps in preparing a budget include all of the following EXCEPT:

• Balance your budget

• Decide how much to spend

• Estimate your expenses

• Estimate your income

A set of goals for spending, saving and investing money is a:

• Budget

• Financial Plan

• Investment Accounts

• Savings Plan

are expenses that are costly and require years of planning and saving:

• Fixed expenses

• Long-term needs

• Short-term needs

• Variable expenses

Which of the following is a variable expense?

• Car loan

• Grocery bill

• Insurance premium

• Rent