Economics - Personal Finance Review

Need

• Attainable
• Three months to a year
• Creating Personalized Income and Expense Categories
• An essential item required for life

Wants

• A fundamental belief about what is desirable, worthwhile, and important to an individual
• Something unnecessary, but desired
• Track current income and expenses
• A debt for which you are liable for [financial obligation]

Value

• Allocate Money to Each Category
• Realistic
• Something owed to another - an obligation
• A fundamental belief about what is desirable, worthwhile, and important to an individual

Budget/Spending Plan

• An amount of money spent to buy goods and services for yourself or your business.
• Track current income and expenses
• An essential item required for life
• A spending plan for managing money during a given period of time.

Income

• Money earned through employment and investments.
• An essential item required for life
• More than a year
• Specific, Measurable, Attainable, Realistic, Time Bound

Expense

• A fundamental belief about what is desirable, worthwhile, and important to an individual
• An amount of money spent to buy goods and services for yourself or your business.
• A debt for which you are liable for [financial obligation]
• An amount of money that is the same each time you pay.

Fixed Expense

• Difference between assets and liabilities
• Something owed to another - an obligation
• An amount of money that is the same each time you pay.
• Costs that change in amount each time they are paid

Flexible Expense [variable]

• Inability to pay all debts
• Attainable
• Something unnecessary, but desired
• Costs that change in amount each time they are paid

Debt

• A fundamental belief about what is desirable, worthwhile, and important to an individual
• A value that is owned
• Specific
• Something owed to another - an obligation

Liabilities

• A value that is owned
• Something unnecessary, but desired
• A spending plan for managing money during a given period of time.
• A debt for which you are liable for [financial obligation]