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WorksheetsT1 Eco Efi Mod BB,T&E, Budgeting
Total questions: 50
Worksheet time: 25mins
Which of the following should NOT be considered when setting a current budget?
your financial goals
future income
needs and wants
savings
What should be considered when setting a budget?
needs and wants
savings
time management goals
needs, wants, and savings
_________ are good places to look to find your current expenses when building your budget.
banks and credit unions
grocery stores and concerts
bank and credit statements
online research websites
Bank statements, credit statements, and records of cash expenses help you to estimate your _________
credit score
emergency fund needs
expenses
available investments
In addition to needs, what should you plan for first when creating a budget?
possible charitable donations
shopping money
investments
recurring expenses
Which of the following statements is true?
Recurring expenses don't need to be planned for because they rarely happen.
Recurring expenses are expenses that can never be stopped.
Recurring expenses should be planned for after looking at your wants.
none of the above.
The envelope method, notebook and pencil, and online software are all methods of _________
planning for your future
understanding your current expenses
estimating your unexpected expenses
tracking your spending
Which of the following is not true about emergency funds?
They are used for anything listed on the budget.
They can keep you from borrowing money from friends and family.
They help you prepare for unexpected expenses.
They help remove the worry about expenses not in the budget.
This helps you prepare for unexpected expenses.
credit cards
checking account
emergency fund
none of the above
When setting a budget, you should consider
financial goals, current expenses, and income
mostly income
creative ways to spend your money
mostly your goals
What is not true about unexpected expenses?
They do not occur if you have a budget.
They could impact your budget in a negative way.
They could interfere with your ability to pay your bills.
They shoudl be planned for so that you can keep within your budget.
Which of the following expenses would be a good reason to spend money from an emergency fund?
repair your laptop that you use for homework
upgrade your phone to the latest model
buy new track shoes because they're in style
purchase concert tickets to see you favorite artist
An unanticipated expense that will make it difficult to get by day-to-day would be a candidate for
spending money from your "rent" envelope
emergency fund spending
tracking all of the money you spent in a month
getting an extra job so you can have money to cover that expense
What is not a good way to prevent unnecessary spending?
Cancel any unused recurring expenses like subscription boxes.
Use an app to find the cheapest gas station.
Make your own food more often.
Buy all of your wants at one time.
How can you ensure you don't go over your budget?
Round up your expense estimates to add a buffer.
Use most of your budget for entertainment expenses.
Find a friend that enjoys going shopping.
Buy all of your wants at one time.
Which of the following is NOT a common feature of a financial institution?
access to investment products
paper checks
access to ATMs
direct deposit
Which of the following is NOT a common feature of a financial institution?
access to ATMs
investment trading
direct deposit
debit cards
Which of the following financial institutions typically have the highest fees?
check cashing and payday loan companies
credit unions
brick-and-mortar banks
internet banks
Which type of bank account typically offers the least, if any, interest?
checking account
savings account
money market account
certificate of deposit (CD)
Which savings account will earn you the most money?
one that compounds interest daily
one that compounds intrest monthly
one that earns simple interest daily
one that earns simple interest monthly
How can you avoid spending more than what is in your bank account?
Check your bank statement once a month.
Ask your financial institution to notify you when you are close to $0 in your account.
Keep your own records to compare with your financial institution's records.
none of the above
How would you reconcile your bank account to avoid spending more than you have?
Contact your financial institution to read your transactions for the past month.
Compare your own records of your spending with your financial institution's records.
Review your bank statement once at the end of the month.
none of the above
What should you do before you withdraw money from the ATM?
Ask someone nearby for help using the ATM.
Find a hidden ATM so no one will see you withdraw money.
Inspect the ATM to make sure it wasn't tampered with.
Share your pin number with trusted friends so you don't forget it.
Which of the following statements about savings accounts is FALSE?
Savings accounts pay interest on the money you deposit.
Savings accounts allow an unlimited number of withdrawals each month.
Savings accounts may require you to maintain a minimum balance to avoid paying a fee
Savings accounts are best used to store money for longer-term goals.
Which of the following statements about savings accounts is FALSE?
Savings accounts pay interest on the money you deposit.
Savings accounts limit the number of withdrawals that can be made each month.
Savings accounts don't usually require a minimum balance to avoid paying a fee
Savings accounts are best used to store money for longer-term goals.
Which of the following statements about savings accounts is FALSE?
Savings accounts don't usually pay interest on the money you deposit.
Savings accounts limit the number of withdrawals that can be made each month.
Savings accounts may require you to maintain a minimum balance to avoid paying a fee
Savings accounts are best used to store money for longer-term goals.
Which statement is true?
If there is a mistake on one of your bank accounts, there is nothing you can do about it.
If there is a mistake on one of your bank accounts, you should wait 30 days as these issues tend to resolve themselves.
If there is a mistake on your bank account, you should contact your financial institution immediately.
none of the above
If there is a mistake with one of your bank accounts, who should you contact to resolve the issue?
the CFP
no one, you can't resolve the issue
the local police station
your financial institution
Which statement about investing is true?
On average, putting money in a savings account earns a higher return that investing money in the stock market.
Investing is riskier than putting money in a savings account.
Investing is best for short-term financial goals.
Investing is a guaranteed way to make money.
Investing is best for
short-term financial goals, like building an emergency fund
earning a little interest while keeping your money safe
long-term financial goals, like paying for retirement
guaranteed fast growth on your money
Which of the following statements about investing is false?
Investing is a guaranteed way to grow your money.
Investing is riskier than putting your money in a savings account.
Investing is best for long-term financial goals, like paying for retirement.
On average, investing money in the stock market earns a higher return than putting money in a savings account.
A stock is
a type of debt investment that acts like a loan
a type of investment that invests in a mix of different types of investments
a share of ownership in a company
a type of savings account that pays interest based on current interest rates in the money market
A mutual fund is
a type of debt investment that acts like a loan
a share of ownership in a company
a type of investment that invests in a mix of different types of investments
a type of savings account that pays interest based on current interest rates in the money market
Generally, the more education you receive, the ________________ will be
the lower your lifetime earnings
lower your electricity bills
higher your food bills
higher your lifetime earnings.
What is the difference between gross and net pay?
Gross pay is after taxes are subtracted but net pay is before taxes are taken out.
Gross pay is before taxes are subtracted but net pay is after taxes are taken out
Gross and net pay are basically the same thing.
Net pay is a salary and gross pay is from hourly wages.
The amount of money you're paid, after all taxes and deductions are taken out of your paycheck is called ________.
gross pay
net pay
total pay
year-to-day pay
Which of the following is NOT a possible tax or deduction that could be withdrawn from your paycheck?
State income tax
Contribution retirement savings
FICE
Sales tax
What is the purpose of the W-4 form?
To file your tax return
To determine how much your gross pay should be
To inform your employer of how much federal income tax to withhold from your paychecks
To avoid paying income taxes on your paychecks
When you start a new job, you fill out a W-4 form to _________.
determine how much your gross pay should be
file your tax return
avoid paying income taxes on your paychecks
to determine how much federal income tax your employer should withhold from your paychecks.
Your employer sends you a _______ form that tells you how much you've made and how much you've paid in taxes in the last year.
1040
W-2
W-4
W-9
What does the W-2 form tell you?
How much you've earned and how much taxes you've paid in the last year.
When to file your tax return
How much federal income tax your employer will withhold from your paycheck
How often your employer will be paying you
How does the government pay for roads, schools, and emergency services?
They are fundded through non-profits.
They are funded through taxes.
They are funded through charitable donations.
None of the above.
Why might preparing taxes be different for people living in different states?
Everyone must file state taxes but depending on where you live, you may not need to file federal taxes.
Everyone must file federal taxes, but each state has different tax laws.
It's not different. All states have the same tax laws.
State taxes are due January 1st but federal taxes are due April 15th.
To file your federal and state taxes you ____________
must prepare the same tax forms for both
can use tax preparation software for federal taxes, but can't for state taxes
can use tax preparation software for state taxes, but can't for federal taxes
must prepare different forms for each type of government (if your state requires it)
Tax preparation software can help prepare and file your taxes by ________
making an appointment with a tax expert for your
posing questions to collect necessary information
calculating your taxes based on your savings account balance
providing you with blank tax forms you can fill out
Why is it necessary to have a W-2 or 1099 form when using tax preparation software?
They highlight job performance which can reduce your tax rate
They include password for tax preparation software
These forms report income which needs to be used to file taxes.
They show how much you have donated to charities.
Why is it useful to have your bank account and routing numbers when using tax preparation software?
To indicate where tax refunds should be sent
To show how much interest you have earned over the year
To use as additional firms of identification
To show much money you have paid in taxes.
Deductions and credits can _______ what you owe in taxes each year.
increase
reduce
double
share with others
If you have to decide to claim a credit or deduction on your taxes which should you take?
Claim only deductions since credits are charged to you and can result in big bills later.
Claim all deductions and credits that you are eligible for since they both can reduce your taxes.
Only claim credits since deductions reduce the amount of money in your tax refund.
Claim both since they document how much in taxes you have paid.
Healthcare, paid time off, disability insurance, and matching contributions to a retirement account are all types of _________ available from your employer.
Benefits
Pensions
Deductions
Allowances
