Creating a Personal Budget

What is the first step in creating a personal budget?

• List your expenses

• Track your expenses

• Identify your short-term and long-term goals

• Calculate your income

Why is tracking your expenses important in budgeting?

• To categorize your expenses

• To calculate your income

• To keep up with your budget

• To plan your budget

What does the 50-30-20 spending plan help with?

• Categorizing expenses

• Calculating income

• Setting up a monthly budget

• Identifying short-term and long-term goals

What should you do if your expenses exceed your income in a budget?

• Cut back on essential expenses

• Increase your income

• Adjust your budget lines and reduce nonessential categories

• Add more to your emergency fund or savings goals

How can categorizing expenses help in making better spending choices?

• By identifying areas to cut expenses

• By tracking your spending

• By setting up a monthly budget

• By calculating your income

What is the benefit of budgeting on an annual basis?

• It allows for better comparison of budget and actual expenses

• It helps set short-term and long-term goals

• It enhances understanding of financial position

• It helps plan day-to-day spending

What does an annual budget help ensure?

• Finding areas to reduce spending

• Setting financial goals

• Having more money than expenses

• Spending more money than income

What can be done to increase savings in a budget?

• Cutting back on expenses

• Increasing income

• Both listed answers

• Neither listed answer

What should Jessica do if she wants more savings?

• Neither listed answer

• Both listed answers

• Increase her income

• Cut back on expenses

What can Jessica do with the money left over at the end of the year?

• All of the above

• Save it for emergencies or unanticipated expenses

• Dedicate it to her long-term goal

• Apply it to her short-term goal

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