Personal Finance - Unit 1 Vocab

Financial objectives achievable within a year, such as saving for a vacation or a new phone

The process of identifying specific, measurable and time-based objectives to achieve financial success

The ability to understand and effectively use financial skills, such as budgeting, saving and investing

A step-by-step approach to making choices, often involving evaluating options and weighting costs and benefit

Goals that are Specific, Measurable, Achievable, Relevant & Time-bound. Often used for financial planning

Financial objectives that take several years or more to achieve, such as buying a house or retirement planning

Money spent on goods, service, or bills

A plan for managing income, expenses, and savings over a specific period of time

Money received from work, investments or other sources

The portion of income not spent on current expenses, often set aside for future use or emergencies

The value of the next best alternative that is given up when making a deicison

The distinction between essential expenses (needs) and non-essential items (wants)