Ramsey - Chapter 2 - Lesson 3

Which of the following is NOT one of the Five Foundations?

• Save $500 emergency fund

• Get out and stay out of debt

• Invest in the stock market

• Pay cash for your car

What is the first step in the Five Foundations?

• Pay cash for college

• Save $500 emergency fund

• Build wealth and give

• Get out and stay out of debt

Which of the following is a benefit of a Zero-Based Budget?

• It allows you to save more than you earn.

• It ensures that every dollar you have is accounted for.

• It helps you to spend more than you earn.

• It makes budgeting unnecessary.

What is the main goal of a Zero-Based Budget?

• To have a surplus of income over expenses.

• To have a deficit of income over expenses.

• To have income equal to expenses.

• To ignore income and expenses.

Which of the following is a key concept of a Zero-Based Budget?

• Income should be greater than expenses.

• Expenses should be greater than income.

• Income minus expenses should equal zero.

• Income and expenses should be ignored.

What are the Four Walls you should focus on in your budget?

• Food, Utilities, Shelter, Transportation

• Food, Entertainment, Travel, Clothing

• Utilities, Education, Health, Insurance

• Shelter, Savings, Investments, Debt

What percentage of your gross income should you budget for retirement when you have no debt other than a mortgage?

• 15%

• 10%

• 20%

• 5%

What is the second step in the Five Foundations?

• Save $500 emergency fund

• Get out and stay out of debt

• Pay cash for your car

• Build wealth and give

Which of the following is a benefit of having an emergency fund?

• It allows you to invest more aggressively.

• It provides financial security in case of unexpected expenses.

• It helps you to spend more on luxury items.

• It eliminates the need for a budget.

What is the main purpose of a budget?

• To track your spending and ensure you live within your means.

• To increase your debt.

• To ignore your financial goals.

• To spend all your income on entertainment.