budget

What does it mean to balance a budget?

A balanced budget means that your expenses do not outweigh your income and all of your necessities are met.

What is a SMART Goal?

A smart goal is a specific, measurable, attainable, realistic, and time-bound; utilized for goal setting.

final budget that results in all expenses covered in revenues.

Balanced budget-

financial plan counting for revenues and expenses.

Budget-

an excess of expenditures over revenues

Deficit-

income remaining after deduction of taxes, other mandatory charges, and expenditure on necessary items

Discretionary income-

income remaining after deduction of taxes and other mandatory charges, available to be spent or saved as one wishes.

Disposable income-

Money set aside for emergency expenses.

Emergency fund-

Identify the factors affecting a budget.

Factors affecting your budget include income, variable and fixed expenses.

costs of owning/operating a property or business that do not change month to month

Fixed expense-

an ambition, aim, or desired result

Goals-

money received on a regular basis from working

Income-

goals that can take place from 1 to 5 years, requires more planning and preparation than a short term goal, but does not require the time of a long term goal

Intermediary goals-

goal that requires a lot of time to reach

Long term goal-

Why are budgets important?

Most people should have a budget, it keeps money on track and is like a "plan."

goods or services that are required

Needs-

the values of the best alternative given up

Opportunity Costs-

paying yourself before you begin paying your monthly living expenses and making discretionary purchases.

Pay yourself first-

income received by persons from all sources. It includes income received from participation in production as well as from government and business transfer payments

Personal income-

the end results you want to achieve generally within one or two years

Short-term goal-

a budget or plan so that you do not spend more money than you bring home each month

Spending Plan:

an amount of something left over when requirements have been met; an excess of production or supply over demand.

Surplus

a balance achieved between two desirable but incompatible features; a compromise.

Trade Offs:

are costs that change in proportion to the good or service that a business produces. Variable cost are also the sum of marginal costs over all units produced. It can also be considered normal costs. Fixed costs and variable costs make up the two components of total cost

Variable Expenses:

How do you create a budget?

When developing a budget, it is important to consider your income, costs, taxes, and goals.

Compare income vs. fixed and variable expenses.

Your income should always be able to cover your fixed expenses such as a mortgage but it should also be able to cover variable expenses with change change periodically or are unexpected. A budget will help to plan accordingly to these expenses.

state some guidelines for creating an emergency fund.

having an emergency fund means that you have an account that is used to set aside funds to be used in an emergency, such as the loss of a job, an illness or a major expense.

Explain what it means to pay yourself first.

paying yourself before you begin paying your monthly living expenses and making discretionary purchases.

something that a person desires that isn't exactly necessary

wants