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Basics (Personal Finance) Beginner: Budgeting

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Choose wisely. There is only one correct answer to each question.

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1.
If your expenses exceed your income in your budget, you may need to revise what you spend your money on, and how much you spend.
Choose wisely. There is only one correct answer.
True. You could also earn more money, but it may be easier to change your spending habits.
2.
Any past debts you are paying on should be grouped under your expenses in your budget, even though you did not incur them this month.
Choose wisely. There is only one correct answer.
True. Even though your debts are ghosts of past expenses, you would include them among your current expenses in your budget.
3.
Which of the following is most likely to be a variable expense?
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Your groceries. In nearly all cases, groceries are likely to vary in price and how often you buy them.
4.
If you spend more than the net income you make in a month, you will have to _________.
Choose wisely. There is only one correct answer.
Any of the above. The money has to come from somewhere. Dipping in to your savings account steals money you have allocated for other financial goals. Borrowing by buying products using a credit card gets you off the hook from being short for the month but causes you to go into debt and carry a loan balance at a very expensive interest rate. Being late on a bill is never a good idea and can affect your credit score.
5.
All online budgeting tools cost money.
Choose wisely. There is only one correct answer.
False. Many of them are free to use.
Introduction to Budgeting What Is a Budget? The Anatomy of a Budget Your Spending Choices in Your Budget Budgeting Activity Selecting a Budgeting Tool Summary of Budgeting Find out what you learned