Budgeting, Checking, Savings, & Investing

1. What is the purpose of creating a budget?

• 1. a) To determine how much money you have available to spend on needs and wants

• 1. b) To track your income after taxes

• 1. c) To categorize your expenses

• 1. d) All of the above

1. Which of the following is a fixed expense?

• 1. a) Travel expenses

• 1. b) Entertainment expenses

• 1. c) Car payment

• 1. d) Flexible spending

3. Which of the following strategies is most effective for managing flexible spending in a budget?

• 3. a) Cutting back on all discretionary expenses entirely.

• 3. b) Allocating a fixed amount each month for flexible spending.

• 3. c) Prioritizing flexible spending over fixed expenses.

• 3. d) Completely eliminating flexible spending from the budget.

3. Which of the following statements best describes the concept of needs and wants in budgeting?

• 3. a) Needs are essential expenses, while wants are discretionary expenses.

• 3. b) Needs are short-term expenses, while wants are long-term expenses.

• 3. c) Needs are fixed expenses, while wants are flexible expenses.

• 3. d) Needs and wants are interchangeable terms in budgeting.

1. How can budgeting help you prepare for future financial emergencies?

1. Why is it important to keep track of your expenses and categorize them in a budget?

1. Why is it important to open a checking account if you have a budget and bills to pay?

1. What should you research before opening a checking account?

1. What are the consequences of spending more money than you have in your account?

1. How can you access the funds in your checking account using an ATM card?