Chapter 12-Money Management Strategy

Personal Balance Sheet

also called a net worth statement; a financial statement that lists items of value owned, debts owed, and a person's net worth

Budget Variance

any difference between actual spending and budgeted amounts

Encounter

A brief or an unexpected meeting

Budget

A plan for making and spending money

Liquid Assets

cash and items that can be quickly converted to cash

Liabilities

debts that you owe

Surplus

extra money

Evaluate

form an idea of the amount, number, or value of; assess.

Personal Financial Statement

gives information about your current financial position and presents a summary of income and spending

Assets

money and other valuables belonging to an individual or business

Income

money received, especially on a regular basis, for work or through investments.

Take-Home Pay

the amount of income left after taxes and other deductions are taken out of your gross pay

Foundation

the basis from which an idea or situation develops

Money Management

the day-to-day financial activities associated with using limited income to satisfy your unlimited needs and wants.

Net Worth

the difference between assets and liabilities

Insolvency

the inability to pay debts when they are due because liabilities far exceed the value of assets

Discretionary Income

the money that remains after paying for taxes and necessities

Market Value

the price at which property would sell

Wealth

the value of assets owned

Cultivate

to nurture, improve, refine, promote

Resolve

to reach a decision

Secure

Lock, put away or stop work; gain control of

Cash Flow

Movement of the money you receive and the money you spend.

Real Estate

Property such as land, houses and office buildings.

Deficit

Spending more than you received

Safe-Deposit Box

a small, secure storage compartment that you can rent in a bank, usually for $100 a year or less