Budgeting, credit, saving, and other essential personal finance concepts.
40 cards · basic cards · AI-written, checked twice. Edit anything.
- What is a budget?
- A plan for how to spend your money over a set period
- What is the 50/30/20 budgeting rule?
- Allocate 50% of income to needs, 30% to wants, and 20% to savings and debt repayment
- What is the difference between needs and wants?
- Needs are essential to survive (food, shelter, utilities); wants are things you desire but could live without
- What is income?
- Money you receive, usually from working or investments
- What does it mean to balance a budget?
- Making sure your income equals or exceeds your total expenses
- What is discretionary spending?
- Money spent on things you want but don't need, such as entertainment or dining out
- What is essential spending?
- Money spent on necessities you must pay for to live, such as food, shelter, and utilities
- What is a credit score?
- A number that indicates how reliable you are at borrowing and repaying money
- What is the typical range for a credit score in the US?
- 300 to 850
- What does a higher credit score mean for borrowing?
- Better chance of getting approved for loans and credit cards at lower interest rates
- What is a credit card?
- A card that allows you to borrow money to make purchases now and pay the balance later
- What is interest?
- The cost of borrowing money, typically expressed as a percentage of the amount borrowed
- What is credit utilization?
- The percentage of your available credit limit that you are currently using
- What is a good credit utilization ratio?
- Under 30% of your total available credit
- What is an emergency fund?
- Money saved specifically for unexpected expenses or loss of income