Budgeting Review

What is an essential first step in creating a budget?

• List your expenses and income

• Apply for loans

• Buy insurance

• Check your credit score

How much of your income should ideally go to savings?

• 5-10%

• 10-20%

• 20-30%

• 50%

What is an emergency fund used for?

• Annual vacations

• Unexpected expenses

• School supplies

• Movie tickets

What is the primary purpose of a budget?

• Track only savings

• Spend all income

• Plan how to use money effectively

• Avoid paying taxes

What is considered a variable expense?

• Rent

• Car Loan

• Grocery Shopping

• Insurance Premiums

What is discretionary spending?

• Necessary spending on rent and utlities

• Unexpected Medical Bills

• Spending on Non-Essential items

• Expenses covered by insurance

If your expenses exceed your income, what should you do first?

• Use Credit Cards for the difference

• Take out a Loan

• Increase your entertainment budget

• Cut unnecessary expenses

What is a Fixed Expense?

• Electric Bill

• Car Payment

• Dining Out

• Groceries

What percentage of your income is recommended for transportation costs?

• 5%

• 10-15%

• 20-30%

• 50%

Which car-related expense will likely vary from month to month?

• Loan Payment

• Insurance

• Registration

• Gas