What is the difference between net and gross income?

Gross income = total money before taxes. Net income = total after tax

What is the general format of a sufficient budget?

50% needs, 30% wants, 20% savings

What does a livable wage account for?

basic needs, savings, and wants

Why do some people get a tax refund?

Too much was taken out of their paycheck in taxes

What are the categories you should break your savings into?

debt repayment, emergency fund, long term goals, short term goals

What is not true about American finances

Americans are on average 50,000 in debt

What is the main goal of a personal budget?

To plan how to use your money to meet your needs and goals

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Financial Literacy Lesson 1

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Questions 12

Answers

1
What is the difference between net and gross income?
Gross income=total before bills. Net income= total after bills.
Net income= total money before bills. Gross income=total after bills.
Net income = total money before taxes. Gross income = total after tax
Gross income = total money before taxes. Net income = total after tax
2
What is the general format of a sufficient budget?
40% needs 40% wants, 20% savings
50% needs, 30% savings, 20% wants
50% needs, 30% wants, 20% savings
30% wants, 30% savings, 40% needs
3
What does a livable wage account for?
just the basic needs
wants and needs
basic needs and savings
basic needs, savings, and wants
4
Why do some people get a tax refund?
You didn't say your taxes
Their employer made a mistake
They worked too many hours
Too much was taken out of their paycheck in taxes
5
Which are not an example of variable expenses?
Phone bill
Gas
Rent
6
Where do bills go when you don't pay them after a certain amount of time?
Collections
Debt Corpus
They go away
The bank
7
What are the categories you should break your savings into?
debt repayment, loan term goals, short term goals
short term goals and long term goals
debt repayment and emergency fund
debt repayment, emergency fund, long term goals, short term goals
8
What is not true about American finances
Americans are on average 50,000 in debt
2% of Americans are homeless
50% of American make below livable wage.
Roughly 50% of Americans follow a budget
9
What taxes aren't taken off your paycheck?
Social Security Tax
Federal Income Tax
State Tax
Medicare Tax
10
What is the main goal of a personal budget?
To make sure you never run out of money again
To plan how to use your money to meet your needs and goals
To track every dollar you’ve ever spent
To stop yourself from spending money
11
What is considered an affordable % of income for rent?
25%
30%
10%
20%
12
A emergency fund should account for 2-4 weeks of expenses
True
False

Financial Literacy Lesson 1 Flashcards | StudBud