Personal Finance: Key Concepts

Net income is the take-home amount on a paycheck after taxes and withholdings are deducted.
Groceries and gas are classified as variable expenses due to their fluctuating costs.
When budgeting with irregular income, prioritize expenses from most to least important to ensure critical needs are met first.
Discretionary expenses should be evaluated alongside other monthly expenses to determine their impact on your budget.
Fixed expenses remain constant each month, providing predictable costs for budgeting.
A zero-based budget requires accounting for fixed, variable, intermittent, and discretionary expenses against income to ensure every dollar is allocated.
A budget empowers you to spend by providing a structured plan rather than restricting your spending.
The envelope system is effective for managing cash for specific expenses, including groceries, dining out, and entertainment.
After determining income, the three main priorities in budgeting are giving, spending, and saving.
Categorizing income and spending in a budget allows for better financial tracking and management.
Commission refers to earnings based on a percentage of total sales made.
Discretionary expenses do not include fixed costs; these are predictable and necessary expenses.
The primary wealth-building tool is income, as it provides the foundation for savings and investments.
In monthly budget creation, giving is the first prioritized expense, emphasizing the importance of charitable contributions.
Approaching money with a generous spirit fosters gratitude and contentment, enhancing overall satisfaction.
Tracking expenses can help maintain a budget, identify errors, and make necessary adjustments, ensuring financial stability.