Budgeting Basics and Financial Management

This video tutorial guides viewers through creating a budget or spending plan. It covers calculating monthly income, identifying fixed and variable expenses, balancing the budget, and setting financial goals. The tutorial emphasizes the importance of revisiting and adjusting the budget as needed. It also highlights resources available online to assist in budgeting and financial planning.

What is the primary purpose of creating a budget?

• To eliminate all spending

• To increase monthly income

• To track every single expense

• To figure out financial priorities and manage finances

Which of the following is NOT needed to create a budget?

• Pay stubs

• Grocery list

• Investment statements

• Calculator

What should be included when tallying monthly income?

• Only your spouse's income

• Only investment returns

• Only your salary

• Take-home pay, interest, dividends, and other financial benefits

How should you handle quarterly or annual payments in your budget?

• Ignore them

• Add them as they occur

• Divide by the number of months in the payment period and add monthly

• Add them to the next month's budget

What is a recommended method for tracking out-of-pocket expenses?

• Use cash for all transactions

• Track only large purchases

• Round up purchases to the next dollar

• Estimate the expenses

What should you do if your expenses exceed your income?

• Increase your income

• Ignore the difference

• Review expenses to identify areas to cut back

• Borrow money to cover the gap

Which of the following is a financial goal you might set?

• Buying a new car every year

• Building a rainy day fund

• Avoiding all investments

• Spending all your income

How can you determine the monthly savings target for a financial goal?

• Set a random amount

• Save whatever is left at the end of the month

• Divide the total amount needed by the number of months to achieve it

• Estimate based on current savings

What is a key characteristic of a budget?

• It must be strictly followed without any adjustments

• It should only focus on cutting expenses

• It is a living document that can change with your needs

• It should never change

Which tool can help you build and track your spending plan?

• A paper notebook

• A financial advisor

• A smartphone or tablet with access to budgeting websites

• A calculator