Personal Budgets

What is a budget?

• A calendar used to plan out your activities for the month

• A plan for spending and saving your money

• A plan to manage your time for the day

• A type of savings account

Adda has just moved into her own apartment and is working full time. Each item below would go into her budget in the "Monthly Bills" category EXCEPT...

• Cell phone plan

• Rent

• Clothing

• Electricity bill

What is income?

• The money that you earn

• The money that you spend

• Making a withdrawal

• Making a phone call

Marshawn is trying to determine if an item at the mall is a NEED or a WANT. Which question will be most helpful?

• Will something bad happen if I don't have this?

• Do any of my friends have this item?

• How happy will this item make me?

• Will my teachers be excited if I buy this item, or will they be disappointed?

What is gross pay?

• The money that you earn before taking out deductions

• The money that you earn after taking out deductions

What is net pay?

• The money that you earn before taking out deductions

• The money that you earn after taking out deductions

Justine's part-time job pays her $8 per hour. She works for 10 hours this pay period. How much is her gross pay?

• $8.00

• $80.00

• $80.00, minus any taxes she has to pay

• $80.00, plus any taxes she has to pay

Brandon receives his paycheck, and it says his gross pay is $250 and his net pay is $200. How much money did he have in deductions this pay period?

• $50.00

• $200.00

• $250.00

• $450.00

Why should you use your NET pay when creating a budget?

• Your net pay will always be higher, so you'll have more money to spend

• Your net pay is a more accurate picture of how much money you have available to spend or save

• Your employer knows what your gross pay is, but you only know what your net pay is

• Once you have your net pay, you can figure out how much to deduct in taxes, and then you can do your budget

Three of these items represent services provided by the federal government using taxpayer money. Which one represents a personal expense instead?

• National Defense

• Social Security

• Medicare

• Car insurance