Budgeting Vocabulary Review

What is the 50/30/20 budget method?

• A method that allocates 50% to savings, 30% to needs, and 20% to wants

• A method that allocates 50% to needs, 30% to wants, and 20% to savings and debt repayment

• A method that allocates 50% to wants, 30% to savings, and 20% to needs

• A method that allocates 50% to debt repayment, 30% to savings, and 20% to needs

What does "cost of living" refer to?

• The amount of money needed to sustain a certain level of living, including basic expenses

• The amount of money saved each month

• The amount of money spent on luxury items

• The amount of money needed for travel expenses

What is a down payment?

• A portion of the total cost of an item that must be paid at the time of purchase

• A monthly payment for a loan

• A payment made after purchasing an item

• A payment made to reduce interest rates

What are expenses?

• Items or services you pay for such as rent, groceries, entertainment, bills, etc.

• Items or services you receive for free

• Items or services you invest in

• Items or services you sell

Which budgeting method involves using labeled envelopes for spending?

• 50/30/20 Budget

• Cash Envelope Budget

• Fixed Budget

• Variable Budget

What does a budget help you plan?

• Unexpected expenses

• Expected income and expenses

• Only savings

• Only debt repayment

What is the purpose of a down payment?

• To pay off a loan completely

• To cover the full cost of an item

• To pay a portion of the total cost at the time of purchase

• To reduce monthly expenses

What is the lowest income necessary for a worker to meet their basic needs called?

• Net Pay

• Living Wage

• Gross Pay

• Salary

What does the strategy 'Pay Yourself First' involve?

• Spending all your paycheck

• Saving a specified amount before spending

• Paying bills first

• Investing all your money

What is a Residential Lease?

• A contract for buying a house

• A contract for renting property

• A contract for selling property

• A contract for leasing a car