| A | B |
|---|
| Budget | A written cash flow plan |
| Cash Flow Statement | A summary that shows total income and spending for a given time period |
| Carbon Check | a copy of each check written |
| Envelope System | Series of envelopes that are divided into categories (food, entertainment, gas, etc.) and are used to store cash for planned monthly expenses |
| Impulse Purchase | An item that is bought without previous planning or consideration of the long-term effects |
| Overdraft | Occurs when money is withdrawn from a bank account and the available balance goes below zero |
| Reconcile | to match your bank statement with your check book |
| Zero - Based Budget | A cash flow plan that assigns an expense to every dollar of your income, wherein the total income minus the total expenses equals zero. |
| What are three consequences of overdrawing your checking account? | 1. Bounced check fee from the store 2. Overdraft fee from your bank 3. Stress from money mismanagement |
| Rent is a Fixed, Variable, intermittent, or discretionary expense? | Fixed expense |
| Eating out is a fixed, variable, discretionary, or intermit ant | discrectionary |
| What does doing a budget do and help you do? | 1. Show if you are overspending in an area 2. Remove the guilt and shame sometimes associated with a purchase and 3. Make your money go further. |
| True/False The number-one cause of divorce in North America today is stress and disagreements over money. | True |
| True/False The envelope system works great for managing spending on things that don’t normally have a fixed monthly expense. | True |
| True/False If you write a zero-based budget every month, it is not necessary to reconcile your account. | False |
| True/False Budgeting is crucial to your financial success. | True |
| True/False A debit card cannot be used for online purchases. | False |
| True/False ʺPay yourself firstʺ means you should assign a portion of your income to saving and investing every month. | True |
| Online bill pay allows you to make payments to whomever you wish without having to write a check and send it in the mail. | True |
| True or False: Having more than one bank account is never a good idea since it can complicate money management. | False |
| True or False: Setting up automatic account transfers is the easiest way to build your savings for your emergency fund or large purchases. | True |
| True or False: Your Monthly budget should include Variable expenses? | True |
| True or False: Your Monthly budget should include Discretionary expenses? | True |
| True or False: Your Monthly budget should include fixed expenses? | True |
| Is Rent a Fixed, Discretionary, variable or Intermittent Expense? Why? | Rent is a fixed expense because it is the same amount every month |
| Is Eating Out a Fixed, Discretionary, variable or Intermittent Expense? Why? | Eating Out is a Discretionary Expense because you choose to eat out |
| Is Car Repairs a Fixed, Discretionary, variable or Intermittent Expense? Why? | Intermittent because it does not happen all the time. |
| Is Groceries a Fixed, Discretionary, variable or Intermittent Expense? Why? | Groceries are a Variable expense because you may not spend the same amount on food every month |
| What does a written budget if followed remove from your finances? | A Written budget, if followed, can remove overspending, guilt, and management by crisis spending. |
| What are the guidelines for budgeting with an irregular income? | 1. Make a list of all of your expenses for the month ahead of time. 2. Prioritize the list of expenses in order of importance. 3. When you receive your check, spend your money the way it is written down. |
| What percentage of Americans are living paycheck to paycheck? | 70% |
| The zero-based budget is the best method of budgeting because: | The zero-based budget ensures that every dollar you make is assigned a specific purpose |
| True or False: A cash flow statement summarizes all of the income and outgo (spending) over a certain time period | True |
| True or False: A budget is a written plan for saving and spending | True |
| True or False: A budget is meant to summarize the saving and spending that has taken place over the past year. | False |
| True or False: The cash flow statement is reflective of what has already taken place | True |
| Typical millionaires usually do not do what kind of things with their money? | 1. Lease a new car 2. Replace things that are not broken 3. Carry Debt. |
| What are 3 record-keeping features you could expect from your bank? | 1. A reconciliation sheet 2. An account register 3. A monthly account statement |
| Choose One: Occurs when money is withdrawn from a bank account and the available balance goes below zero (overdraft, reconcile) | Overdraft |
| Which of the following account records would have the most current balance? A. Account balance from ATM statement B. My own account register C. My monthly bank statement | B. My own account register |
| Choose One: A cash flow plan that assigns an expense to every dollar of your income, wherein the total income minus the total expenses equals zero (zero-spending plan, zero-based budget) | Zero-based budget |
| Choose One: Series of envelopes that are divided into categories and are used to store cash for planned monthly expenses (Envelope system, check carbon) | Envelope System |
| Choose One: An item that is bought without previous planning or consideration of the long-term effects (sale item, impulse purchase) | Impulse purchase |
| Choose One: To match your bank statement with your checkbook (cash flow plan, reconcile) | Reconcile |
| Choose One: A written cash flow plan is (budget, personal finance) | Budget |
| Choose One: Expenses that remain the same from month to month (variable, fixed) | Fixed |
| Choose One: Non-essential expenses is (discretionary, intermittent) | Discretionary |
| Choose One: A summary of all the income and outgo over a certain time period (cash flow statement, budget) | Cash Flow Statement |
| Choose One: Your own record of all your transactions is a(n) (check register, account statement) | Check register. |
| What are the reasons cash flow plans sometimes do not work? | Cash flow plans do not work when you leave things out, overcomplicate your plan, don’t write a budget, and/or don’t live on your budget. |
| Why is the zero-based budget the best method of budgeting? | A zero-based budget ensures that every dollar you make is assigned a specific purpose |
| Explain why you should always have a cash flow plan? | A written plan removes the management by crisis, guilt, shame, fear, stress, overdrafts and overspending from your finances |
| Describe the various payment options that come with a checking account. | Writing checks, debit card purchase (online or in store), online bill pay |
| Why is it important to maintain a file of both paper and electronic financial records? | You should maintain both paper and electronic files: 1. As a reference for filing taxes, 2. So that you always have an accurate account balance, 3. So that you can catch errors made by the bank, 4. So that you’re aware of fraudulent activity on your account |
| Explain why it’s important to develop a personalized financial plan for spending, saving and record keeping. | Everyone has different spending, saving and organizational strengths and weaknesses. Your plan must work for you |
| Describe some changes in circumstances that might affect a personal budget | Might include change in or loss of income, change in family composition, etc. |
