Questions and Answers
Which of the following is NOT a good way to track your spending?
Recurring expenses are expenses that occur every month.
True
The envelope method, notebook and pencil, and online software are all methods of ___
tracking your spending
What is NOT a good way to prevent unnecessary spending?
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When setting a budget, you can choose to make room for:
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What should be considered when setting a budget?
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Where should you look to find your current expenses when building your budget?
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How can you ensure you don't go over your budget?
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Which of the following is NOT a benefit of using a budget?
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When setting a budget, you should consider...
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They do not occur if you have a budget.
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What budgeting tip(s) would help you stay on track financially?
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Which of the following expenses would be a good reason to spend money from an emergency fund?
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They should be planned for.
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An unanticipated expense that will make it difficult to get by day-to-day would be a candidate for...
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In addition to needs, what should you plan for first when creating a budget?
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Which of the following should NOT be considered when setting a current budget?
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An emergency fund should NOT be used for...
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Which of the following is a benefit of using a budget?
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Which choice or choices best describes the purpose of an emergency fund?
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Study Notes
Budgeting Concepts
- Tracking Spending: The least effective method is keeping track of expenses in your head.
- Recurring Expenses: These are fixed costs that occur monthly, such as rent or utilities.
- Methods of Tracking Spending: Effective ways include the envelope method, using a notebook, or employing online software.
Spending Prevention Strategies
- Avoiding Unnecessary Spending: Planning to buy all wants at once is not a good strategy for maintaining a budget.
Budgeting Essentials
- Budget Flexibility: When setting a budget, allocate resources to needs, wants, and savings.
- Expense Sources: Current expenses can be assessed through bank and credit statements.
Budget Management Tips
- Avoiding Over-budgeting: Round up expense estimates to create a financial buffer.
- Benefits of a Budget: A budget helps manage expenses but does not allow for unlimited purchases.
Planning for Future Needs
- Budget Considerations: Assess financial goals, current expenses, and income while budgeting.
- Unexpected Expenses: Having a budget does not eliminate unexpected costs; these should be anticipated.
Emergency Funds
- Usage of Emergency Funds: Appropriate uses include essential repairs, such as a laptop needed for schoolwork.
- Planning for Emergencies: Unexpected expenses should be planned for in your budgeting strategy.
- Emergency Fund Limitations: Funds should not be used for non-essential entertainment expenses, like going to the movies.
Overall Benefits of Budgeting
- Budgeting Tips: Incorporating various budgeting strategies can help maintain financial stability.
- Emergency Fund Purpose: The emergency fund is essential for handling unforeseen financial challenges and should serve multiple purposes.
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Description
Test your knowledge on budgeting with these flashcards from Module 3 of EVERFI. Each card covers essential concepts including tracking your spending and understanding recurring expenses. Perfect for anyone looking to improve their financial literacy.