Financial Literacy: Lesson 3 Making a Budget

Why is budgeting considered an important skill?

• It helps you avoid earning money.

• It makes you spend all your money.

• It helps you save for something you want to buy.

• It helps you spend more money.

What does a budget estimate?

• How much money you can borrow.

• How much money you can lose.

• How much money you earn, receive as gifts, and spend over time.

• How much money you can waste.

What is the first step in creating a budget?

• Figuring out how much money you expect to earn or receive as gifts.

• Spending all your money.

• Ignoring your income.

• Borrowing money from friends.

How much is Frankie's monthly income?

• $50

• $80

• $70

• $60

What are fixed expenses?

• Expenses that change every time.

• Expenses that you pay the same amount for each time.

• Expenses that you never pay.

• Expenses that are always unexpected.

What are variable expenses?

• Expenses that you never plan for.

• Expenses that are always fixed.

• Expenses that vary or change.

• Expenses that you pay the same amount for each time.

What is the total amount Frankie plans to spend on school lunch, magazine subscription, and video game?

• $30

• $40

• $55

• $50

Why is it important to have a flexible budget?

• To spend more money.

• To save for unforeseen changes.

• To avoid saving money.

• To ignore unexpected expenses.

What did Frankie have to contribute to go on a field trip?

• $20

• $15

• $5

• $10