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WorksheetsPF (6)
Total questions: 54
Worksheet time: 27mins
The most common time frame individuals use when developing a budget is __________.
Daily
Weekly
Monthly
Yearly
Which formula represents the math used to create a basic budget?
(Sum of all income) -- (Sum of all expenses)
Surplus -- Deficit
(Income + Taxes + Insurance) -- Expenses
Gross income -- Net income
If you have a budget deficit and are trying to distinguish between needs and wants in your budget, which question is MOST helpful?
Will there be a bad consequence if I don't buy this item?
Do all of my friends have this item?
Will this item last more than one year?
Does this item make me happy?
In which scenario below would an unlimited data plan on your smartphone be best classified as a NEED?
If it allows you to check email and get updates on Twitter during class
If you don't have wifi at home and it allows you to complete homework assignments
If it gives you the ability to use a mobile wallet instead of a debit or credit card
If it keeps you entertained by allowing you to stream videos anywhere
When creating a budget, which list below portrays expense categories in the most responsible order?
All of your needs, high priority wants, low priority wants, savings
All of your needs, savings, high priority wants, low priority wants
All of your needs, high priority wants, savings, low priority wants
Savings, high priority wants, low priority wants, all of your needs
Which item below would MOST PEOPLE consider a need and why?
A week's vacation, to decompress from the stresses of work or school
Professional SAT prep tutoring, to guarantee a high score and college admissions
A new laptop every 2 years, so you can work quickly and efficiently
Auto insurance, to minimize your financial risk if you cause a major accident
How can the college you choose to attend impact your future adult budget?
Any student loans you owe will become a necessary expense in your budget
Students who attend more expensive colleges earn more income once they start working
The budget you create during freshman year will be the same budget you use until age 30
Your scholarship money will impact your taxes for years to come
How are savings and budgeting related?
Once you save enough money, you will no longer need to budget
A good budget will help control your spending and enable higher saving
The more money you save, the higher amount of income you will have available to spend
Saving is the final amount of money you have leftover in any monthly budget
How can completing a budget be beneficial to your health?
A budget reduces your insurance premiums, making it easier to get access to health care
A budget reduces the mental and emotional stress of never knowing if you'll have enough to cover expenses
A budget increases your income, letting you spend more on healthy foods, gym memberships, etc.
A budget increases your heart rate, cholesterol, and other health metrics
Which of these typically represents a fixed cost in a monthly budget?
Rent or mortgage
Car maintenance
Dining out
Groceries
Why is Zero-Based Budgeting called Zero-Based Budgeting?
Your checking account balance goes to $0 every month
It's the best budget to use if you currently have $0 in your savings account
Your budget's income and expenses total to exactly $0, so every dollar is accounted for
It requires 0 knowledge of budgeting skills to achieve this type of budget
Malachi is a 25-year-old man who lives with a roommate in Kansas City. He is going to start using the Cash Envelope method of budgeting. Why is it unnecessary for him to create an envelope called "Car Payment"?
His car payment should be fixed every month, so he doesn't need to monitor spending in this category
His car payment is far too large to take out that amount of cash from the ATM
He should not be spending any money on a car, so he should stop making those payments immediately
A car payment is an expense he would likely split with his roommate, so it isn't suitable for Cash Envelope Budgeting
What does it mean to "pay yourself first?"
Set aside some fun money in each month's budget so you can enjoy yourself
Auto-deposit a set amount of money into savings after each paycheck so that you don't spend all your income
Be self-employed, so that you don't have a boss and get to keep all income from your business for yourself
Do all of your budgeting at the beginning of the month, rather than at the end
Natalia is trying to budget her $4000 take-home pay using a 50/30/20 Budget. How much does she have available to pay for her "needs"?
$50
$800
$1,200
$2,000
Erik is using Zero-Based Budgeting, and every month he has net pay of $500 from his part-time job. As he does his budgeting for next month, he estimates he will need $450 of that to meet his expenses. What should he do with the remaining $50?
Deposit it into his checking account and save it for college
Budget it into his savings account for use at a later time
Spend it on something random, because it's not OK to have leftovers in a Zero-Based Budget
Pretend it doesn't exist
Which style of budget is best suited for someone who chronically overspends on their wants by charging expenses on their credit card?
50/30/20
Zero-Based
Cash Envelope
Wealth Management
For most American households, the largest expenses in their budget will likely be...
Clothes, Entertainment, Food
Food, Housing, Transportation
Food, Insurance, Transportation
Clothes, Food, Housing
Complete this sentence: If your employee compensation is structured as a salary,...
You will earn more for each additional hour you work
You will always out-earn someone who is paid a wage instead
You have agreed to work for a predetermined amount of money
You will not have taxes removed from each paycheck
Which formula best represents the math used to determine your net pay?
Total hours worked x wage
Gross pay -- taxes
Gross pay -- salary
Gross pay -- taxes -- other deductions
At your part-time job, you receive net pay of $400 per month. Each month you automatically save $100, and then you budget $50 for your cell phone, $50 for lunch at school, and $150 for fun with your friends. What is the end result of your budget?
A surplus of $750
A surplus of $50
A deficit of $750
A deficit of $50
Why is it important to budget using your net pay, rather than your gross pay?
Your net pay will be higher, giving you more spending money each month
Your net pay will account for all the taxes and deductions that are removed each paycheck
Net pay is better for teenagers and young adults, whereas gross pay pertains to adult earners
Your total tax bill will be lower if you budget using your net pay
Which piece of advice around saving and budgeting is BEST?
If you have a budget, you don't need to save
Follow your budget each month, and if you end up with a surplus, that money goes into savings
Budget for your savings first each month, and then design the rest of your plan around the remaining money
Use a budget each month, but do your saving one time per year
Why is a budget designed without any category for "fun" or "entertainment" likely to fail?
You'll likely spend at least a little on these things anyway, and then you'll be left with a deficit in other categories
Your app or spreadsheet will come preloaded with those categories, so you cannot skip them
These categories are tax deductible, so you'll be losing money if you don't spend on them
These categories allow you to "pay yourself first," so they're the most important
Isaiah works for the summer at a technology company and has a salary for the summer of $3000. After federal and state taxes and Social Security/Medicare taxes are deducted, his take-home pay is $2500. Which of the statements below is correct?
His gross pay is $2500, and his net pay is $3000
His gross pay is $3000, and his net pay is $2500
His gross and net pay are $3000
His gross and net pay are $2500
All of Mei's friends use a popular budgeting app that costs $4 per month, but she is trying to save money, not spend it. What MIGHT be a good reason for her to consider the app?
Lots of people use it, so she should do it too
Spreadsheet or paper budgets never work as well
The format of a budget is the number 1 predictor of how successful it will be
Budgeting apps have convenient features like auto-tracking expenses or alerts for overspending
Which statement about cost of living is TRUE?
Most American cities have approximately the same cost of living
Cost of living refers to what percentage of your city's population lives above the poverty rate
Your life will be better if you live somewhere with a low cost of living
Cost of living calculations take into account the prices of housing, transportation, food, and other basic needs
Nessa is moving to Los Angeles in a few months. She knows it will be expensive, so she's looking for a roommate. In which budget areas will she likely save money by having a roommate?
Rent, utilities, insurance
Rent, groceries, cell phone plan
Rent, utilities, furniture
Rent, entertainment, parking
What is the purpose of an apartment lease?
It provides the budget you'll use for all of your household expenses
It outlines the amount of rent you'll pay, when it is due, and key obligations and rights of living in the property
It provides insurance if any guests to your apartment are injured on the property
It makes it illegal for your landlord to evict you from the property
Abraham has two job offers, located in cities about 5 hours away from one another. His mom told him he should consider not only his starting salary ($46,000 at each job) but also the cost of living in each city. City B has a cost of living about 30% higher than City A. How might his decision impact his budget?
City A will be more expensive but probably more fun and exciting
He won't have enough money to live in City B, so City A is his only option
If he chooses City B, a higher fraction of his income will go toward paying for essentials
If he chooses City A, he will not need to budget; if he chooses City B, he will need to budget
Young adults are more often choosing to rent instead of buy a home because...
Monthly rent payments are always lower than monthly mortgage payments
Landlords give young people better rates on apartments than older people can qualify for
They're graduating with a lot of student debt they must pay off, so it takes longer to save a down payment
Renting is a better long-term investment strategy
As a renter in an apartment building, the utility MOST likely to be already included in the cost of your monthly rent is...
Streaming services
Garbage
Electricity
Internet
Angelica is trying to choose between two apartments: a one-bedroom for $1000 or a three-bedroom for $1800, which she'd share with her cousin and her cousin's best friend. How much will she save in rent if she chooses the three-bedroom option?
$200
$400
$800
$1,000
You just moved to a new city and are researching different transportation options. You should consider the following factors EXCEPT…
Convenience and budget
Reliability and time schedules
Decor and style
Distance and commute time
Gaby lives one hour away from work and wants to make the most of her commute time to work on her business plan for her side hustle. Which mode of transportation makes the most sense for her while also saving on commute costs?
Driving her car
Biking to work
Taking an Uber
Taking the train
Which analogy about leasing or financing a vehicle is correct?
Financing a car is like renting the car
Financing a car is like selling the car
Leasing a car is like owning the car
Leasing a car is like renting the car
Why are monthly payments with leasing a car lower than monthly payments with financing a car?
Leased cars are typically older models, so they are cheaper
You are only paying for the value you use while driving the car
The gas for a financed car is more expensive than gas for a leased car
You do not need to pay for insurance for a leased car
What is one disadvantage of leasing a car compared to financing a car?
You have higher monthly payments
You have a certain mileage limit on the car
You can only lease used cars
You won't be able to drive it farther than a 10 mile radius from your house
Which of the following statements about vehicle depreciation is FALSE?
A new car typically loses about 10% to 15% of its value by the time you drive off from the dealership
The biggest depreciation happens within the first few years of new car ownership
You can avoid depreciation by getting the most expensive insurance plan
Vehicle depreciation is defined as the reduction in value of the car as time passes
What is the most accurate comparison of pros and cons between purchasing a new car versus a used car?
New cars can be bought at a lower price, but often require more maintenance costs than used cars.
New cars don't have damage from a previous owner, but only used cars typically come with a warranty.
Used cars can be bought at a lower price, but often require more maintenance costs than new cars.
Used cars can be bought at a lower price, but will depreciate faster than new cars.
When selecting your car payment plan, the _____ your loan term is, the lower your monthly bill will be. However, your overall interest will be ______.
longer; higher
shorter; higher
longer; lower
shorter; lower
What is the BEST option that you can try to cut down on commuting costs?
Take the longest route to work
Join a rideshare or carpool
Purchase a new car
Only go to work once a week
Which of the following costs would increase if you had a longer commute to work or school?
Car payments
Vehicle registration fees
Fuel and maintenance
Parking fees
What is the BEST way to track your spending on food?
Gather monthly receipts from only grocery stores
Gather monthly receipts from only restaurants
Compare monthly receipts from grocery stores and restaurants
Check your bank account transactions for fast food spending
All of the following options are ways to avoid overspending at the grocery store EXCEPT…
Look at unit price.
Create a shopping list.
Purchase the first item you see at eye level
Use a shopping basket.
Which of the following prices are trying to lead you to purchase more (than necessary)?
“Sodas for $3” all being sold individually
“Ten cookies for $10” when cookies are already $1
“1/2 off on Valentine’s candy” the weekend after Valentine’s Day
“$5 for Safeway members” for a gallon of ice cream
Why is it useful to go straight to the aisles when grocery shopping?
To focus on only purchasing the items on your grocery list
To purchase baked goods that smell fresh
All of the items in the aisles are always on sale
The items that last longer are placed in the aisles
How is unit price calculated?
Subtract number of items from total cost
Add total cost and number of items
Divide total cost by number of items
Multiply the cost of a singular item by the number of items in a package
Which of the following package deals is a better buy according to unit price?
$5.73 for 3 cans
$11.44 for 8 cans
$13.55 for 5 cans
$14.28 for 6 cans
All of the following options are different factors that affect how much of an item you purchase EXCEPT...
How long it stays fresh
How often you eat that item
How many people are eating
How hungry you are while you are shopping
Which of the following statements about eating at restaurants is TRUE?
Items on a restaurant menu are about 3 times more than the cost to make the meal
Chefs only use organic ingredients that are better than items found at a grocery store
It’s healthier to eat out at restaurants than going grocery shopping
It’s cheaper to eat out at restaurants than going grocery shopping
The following options are reasons why Gen Z might eat out more often EXCEPT...
Healthy and diverse options of meals
Convenience of fast-paced apps
Socialization and sharing with friends
More budget-friendly
All of the following are pros to renting an apartment EXCEPT:
More flexibility to relocate when needed.
Lower upfront costs.
No maintenance responsibility.
Tax deductions for property taxes.
On average, people spend around __________% of their annual budget on transportation.
8-10%
14-16%
18-20%
23-25%
You drive 1,000 miles per month, your car gets 30 mpg, and the current gas price is $3.00 per gallon. How much should you budget for gas this month?
$90
$100
$300
$3,000
