Money management refers to

Day-to-day financial activities

In regards to personal finances, "zero-based budgeting" is:

The practice of budgeting every dollar of income received.

Which of the following are the best tools for budgeting?

Any of above. Whatever works best for you.

A plan that tracks future expenditures based on income

What is discretionary income?

The income that remains after taxes and expenses are paid

What is the most likely reason for a budget to fail?

Not est. an emergency fund to pay for unforeseen expenses

A question associated with the saving component of financial planning is:

Do you have an adequate emergency fund?

A home file should be used for:

storing all financial documents and records.

With an “Emergency" savings fund, you:

Set aside money for emergencies or essential spending

Which of the following is usually considered a long-term financial strategy?

investing in mutual funds to increase retirement amount

The equation to calculate net worth is

Assets - Liabilities = Net worth

Which of the following goals would be the easiest to turn into a smart goal?

"Save $100 a month to create a $4,000 emergency fund."

When creating a budget, it is important to

Set aside savings prior to other expenses.

The financial planning process concludes with efforts to:

review and revise your actions.

Which of the following is an example of opportunity cost?

saving money instead of taking a vacation

A budget deficit would result when a person's or family's:

actual expenses are less than planned expenses.

The best way to start the budgeting process is to:

Start tracking all of the $$$ you spend in a month

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Money Management (Budget) Review

35 termsStudBud Administration593 plays

Mr. Lapointe's Unit 2 Review for Personal Finance

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Questions 35

Answers

1
Which of the following is an example of a 'fixed expense'?
Groceries
Charitable donations
Mortgage
Fuel
2
Payments that do not vary from month to month are ____________ expenses.
usage
fixed
variable
luxury
3
A common deduction from a person's paycheck is:
FICA Tax
medical Insurance
Income Tax
All of the above
4
Money management refers to
Trade-offs that occur with financial decisions.
Day-to-day financial activities
Preparing personal financial statements.
Storing financial records for easy access
5
In regards to personal finances, "zero-based budgeting" is:
Stopping all spending on incidentals such as dining out
A method where you put 'zero' dollars on your credit card.
Paying all of your bills each month with $ left over
The practice of budgeting every dollar of income received.
6
Which of the following categories would be most difficult to cut from a household budget?
Cable
Vacations
Auto Insurance
Gas consumption for vehcles
7
Which of the following are the best tools for budgeting?
Any of above. Whatever works best for you.
A pencil and paper.
Personal financial management software.
A spreadsheet program
8
What is budgeting?
A.Having money left over at the end of the month.
A plan that tracks future expenditures based on income
The ability to pay your bills on time
Having enough money to go out to eat.
9
How long should you keep copies of your tax returns?
until you submit your refund
1-7 years
at least 7 years
Until you receive your refund
10
What is discretionary income?
The amount of money you place into a savings account
Commissions or bonuses paid by your employer
The money used to make your rent payment or other expenses.
The income that remains after taxes and expenses are paid
11
What is the most likely reason for a budget to fail?
Not making enough money
Buying a pair of shoes you just couldn't resist.
Not est. an emergency fund to pay for unforeseen expenses
Not using a personal financial planning website or software
12
A Net Worth Statement
Amounts budgeted for spending.
Earnings on savings and investments.
Income and expenses for a period of time.
Items owned and amounts owed.
13
A question associated with the saving component of financial planning is:
Do you have an adequate emergency fund?
Are you overspending on your investments?
Is your will current?
Do you have a realistic budget?
14
When putting together a budget, which of the following items should you include?
Fixed Income
All of the above
Goals
Savings
15
Difference between budgeted amounts and actual results are classified as
A.standard deviation
Variance
mean average
weighted average
16
With an 'envelope' budgeting system, you:
The cash for each month's goal's is divided into envelopes
You stop spending $$$ once the designated envelope is empty.
You spend $ on an expense by using the designated envelope.
All of the above
17
$370 was budgeted on food. $348 was actually spent. What is this difference called?
budget reduction
fixed living expense
variance
deficit
18
The amount you would have if everything of value was sold and all debts were paid off.
Surplus
Net Assets
Total Income
Net Worth
19
Total earnings of a person minus the deductions for taxes and other items is called:
gross pay.
net pay
total revenue
net worth
20
Jean is setting aside money for her 2 year old's college education. What type of goal is this?
intermediate
long
short
distant
21
A home file should be used for:
storing all financial documents and records.
documents that require maximum security.
obsolete financial documents.
financial records for current needs.
22
The uncertainty associated with decision making is referred to as:
financial goals
risk
selection of alternatives
personal values
23
With an “Emergency" savings fund, you:
Put a fixed amount of $$$ into an account when it rains.
Set aside $$$ to use to treat yourself to something special
Set aside money for emergencies or essential spending
Save up money to buy an umbrella
24
Which of the following is usually considered a long-term financial strategy?
creating a budget
renting an apartment to save for the purchase of a home
using savings to pay off a loan early
investing in mutual funds to increase retirement amount
25
The equation to calculate net worth is
Assets - Cash outflows = Net worth.
Assets - Liabilities = Net worth
Cash inflows - Cash outflows = Net worth.
Cash inflows - Liabilities = Net worth.
26
Items with monetary value are referred to as
Assets
income
liabilities
Net Worth
27
Which of the following goals would be the easiest to turn into a smart goal?
"Save funds for an annual vacation."
"Invest $2,000 a year for retirement."
"Reduce our debt payments."
"Save $100 a month to create a $4,000 emergency fund."
28
When creating a budget, it is important to
Set aside savings prior to other expenses.
Save no more than 3% of your income for an emergencies
Spend more then you budgeted for.
Set aside savings after your variable expenses are paid
29
The financial planning process concludes with efforts to:
analyze your current personal and financial situation.
develop financial goals.
review and revise your actions.
create a financial plan of action
30
An example of a variable expense is a
Mortgage Payment
Electric Bill
Cell phone payment
Life Insurance Payment
31
Which of the following is an example of opportunity cost?
setting aside money for paying income tax
purchasing automobile insurance
saving money instead of taking a vacation
renting an apartment near school
32
The main Purpose of personal financial statements are to
Maintain information about your financial activities.
Provide data for preparing tax forms or applying for credit.
Measure your progress toward financial goals.
These are all correct
33
A budget deficit would result when a person's or family's:
actual expenses equal planned expenses.
actual expenses are less than planned expenses.
assets exceed liabilities
actual expenses are greater than planned expenses.
34
The best way to start the budgeting process is to:
Paying credit card balances in full
Start tracking all of the $$$ you spend in a month
Deposting money into a savings account from each paycheck.
Curbing your incidental spending habits such as dining out
35
All of the following are sources of income except
Commission
Interest
Dividends
Social Security Taxes

Money Management (Budget) Review Flashcards | StudBud