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WorksheetsPersonal Finance Review
Total questions: 23
Worksheet time: 45mins
What is the difference between a want and a need?
CHOOSE TWO!!
Needs are things you can't live without like food, clothing, and shelter.
Wants are things that we would like to have.
Needs are things we really want
Wants are things that we spend money on.
What is an opportunity cost?
A plan for your money
Money that you spend
Money that you give up
What was given up by making a decision.
What is income?
A plan for your money
Money that you spend on things that you need or want
Money that you earn
What was given up by making a decision.
What is an expense?
A plan for your money
Money that you spend
Money that you earn
What was given up by making a decision.
What is a budget?
A plan for your money
Money that you spend
Money that you earn
What was given up by making a decision.
What is NOT an example of an opportunity cost?
You choose to play soccer instead of football
Your friend gave you $5 and you bought Starbucks instead of Culver's Cheese Curds
You invested your savings in an Index fund instead of a CD.
It costs you money to invest in an opportunity like owning a business
What is an emergency fund?
Money that you save for unexpected expenses.
Spending money to own something that hopefully makes money or that goes up in value so you can sell it later.
A bank account that pays a small amount of interest on the money in that account
The price/fee that is paid to borrow/use money. Usually a percentage of the amount borrowed or invested.
What does investing mean?
Money that you save for unexpected expenses.
Spending money to own something that hopefully makes money or that goes up in value.
A bank account that pays a small amount of interest on the money in that account
The price/fee that is paid to borrow/use money. Usually a percentage of the amount borrowed or invested.
What is interest?
Money that you save for unexpected expenses.
Spending money to own something that hopefully makes money or that goes up in value.
A bank account that pays a small amount of interest on the money in that account
The price/fee that is paid to borrow/use money. Usually a percentage of the amount borrowed or invested.
What is a savings account?
Money that you save for unexpected expenses.
Spending money to own something that hopefully makes money or that goes up in value.
A bank account that pays a small amount of interest on the money in that account
The price/fee that is paid to borrow/use money. Usually a percentage of the amount borrowed or invested.
What is the difference between a checking and a savings account?
CHOOSE TWO!
A savings account pays some interest
A checking account is very liquid but does not pay interest
A savings account allows you to make money if you agree to lock you money in for a longer time.
A checking account lets you check you money balance at any time
What is a Pay Yourself First budget?
A plan where you set money aside for your goals first, then pay your needs/ bills, then spend everything that is left on wants.
A plan where you spend 50% of your money on Needs, 30% of your money on Wants, and 20% of your money on Saving and Investing.
A plan where you live your life and do not worry about making a plan for you money.
A plan where you first get a second source of income, so you have more money to spend on paying yourself.
What is a 50-30-20 budget?
A plan where you set money aside for your goals first, then pay your needs/ bills, then spend everything that is left on wants.
A plan where you spend 50% of your money on Needs, 30% of your money on Wants, and 20% of your money on Saving and Investing.
A plan where you live your life and do not worry about making a plan for you money.
A plan where you spend 50% of your money on Investing, 30% of your money on Needs, and 20% of your money on Wants.
Why is a 50-30-20 budget not a good plan for some situations?
In some situations, people are not willing to make a budget because it is a really boring way to live your life.
In some situations, people need to send much more than 50% of their money on Savings and Investing.
In some situations, people must spend much more than 50% of their income on Needs.
In some situations, people are not willing to make a budget because it makes restrictions and stress for just living.
How much money should you keep in an emergency fund?
$12,000
Enough to cover 3-6 months of needs
$1,000
Enough to cover 1 year of earnings
Look at the picture of this person's budget. How much money should they put into an emergency fund?
$5,000- $10,000
$15,000- $30,000
$6,000-$12,000
$40,000-$60,000
Using the 50-30-20 rule, about how much money would you say this person can afford to save for a vacation each month?
$100
(1% more)
$500
(5% more)
$1,000
(10% more)
$1,500
(15% more)
Using the 50-30-20 rule, about how much money would you say this person can afford to invest each month?
$100
(1% more)
$500
(5% more)
$1,000
(10% more)
$1,500
(15% more)
What is a CD?
An bank account that pays you to agree to not use your money for a certain amount of time.
A large group of stocks (usually over 100).
A share, or piece of ownership, of one company.
A loan that a person makes to the government for a certain amount of time.
What is an index fund?
An bank account that pays you to agree to not use your money for a certain amount of time.
A large group of stocks (usually over 100).
A share, or piece of ownership, of one company.
A loan that a person makes to the government for a certain amount of time.
What is a stock?
An bank account that pays you to agree to not use your money for a certain amount of time.
A large group of stocks (usually over 100).
A share, or piece of ownership, of one company.
A loan that a person makes to the government for a certain amount of time.
What is a bond?
An bank account that pays you to agree to not use your money for a certain amount of time.
A large group of stocks (usually over 100).
A share, or piece of ownership, of one company.
A loan that a person makes to the government for a certain amount of time.
What is liquidity?
How likely an investment is to gain or lose money
A bank account that does not pay interest but does let you use checks
How fast or easy it is to get cash out of an investment
The investment in STAX that the computer puts all its money into
