#2 Personal Finance Basics

The primary purpose of a spending plan is to achieve which of the following goals?

• Create a document you can send to your credit card company when you want to increase your spending limit

• To give to the bank to keep on file so you can have a checking account with them

• To help you see the amount of income you have each month, pay all of your expenses, and put money into savings

• To remind yourself you will never get ahead when things become difficult

Which of the following is NOT a way to earn income?

• Part-time or full-time job

• Doing chores for your neighbor

• Volunteering at church

• Earning interest on a savings account

A monthly utility bill is an example of which of the following expenses?

• Discretionary

• Fixed

• Variable

• Secure

A rent payment is an example of which type of expense?

• Discretionary

• Fixed

• Variable

• Secure

Donating to the local animal shelter is an example of which of the following types of expenses?

• Discretionary

• Fixed

• Variable

• Secure

Why do stores intentionally put small and inexpensive items near the checkout lines?

• So shoppers will buy them without much thought

• To allow more room in other areas of the store

• So shoppers will not get bored standing in line

• To allow less clutter in the aisles

Which of the following types of goals best describes something you can achieve in more than 12 months, but less than five years?

• Short-term goals

• Intermediate goals

• Long-term goals

• Future goals

Which of the following types of goals best describes something you can achieve in more than five years?

• Short-term goals

• Intermediate goals

• Long-term goals

• Future goals

Which of the following types of goals best describes something you can achieve in less than 12 months?

• Short-term goals

• Intermediate goals

• Long-term goals

• Future goals

Which of the following is the first step in developing your goals?

• Identify your personal goals

• Prioritize your personal goals

• Develop a plan of action to achieve your personal goals

• Determine your personality