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WHAT DOES THAT MEAN?
TERM
DEFINITION
annualize
to use monthly budgets into a yearly estimate.
budget
an estimate of expected income and expenses for a specific period of time.
budget deficit budget surplus
the amount by which spending exceeds income for a specified period of time. the amount by which income exceeds expenses for a specified period of time. a grouping of related expenditures such as utilities which include gas, power and water.
category
discretionary expenses
costs that are not essential for the operation of a household.
expense income itemize
an outflow of funds. an inflow of funds.
Access vocab ashcards at www.c21publishing.com to break a budget category into parts and list expenses by item. PRODUCT PREVIEW costs that are necessary for operation of a household and must be paid on a regular basis. a one-time charge; not a regular expense. a cost that is repeated regularly, often monthly. the discrepancy between the amount projected to be spent within a category and the actual amount spent.
mandatory expenses
non-recurring expense
recurring expense
variance
I. The Personal Budget The personal budget is a valuable tool for preserving and protecting wealth. A budget tracks your money, knows exactly where it goes, and tells you how to make it work harder for you. A budget provides a realistic picture of your finances, which is essential for staying on track to your financial goals. According to a recent poll, however, only about 30% of Americans have a budget. That seems pretty crazy considering how useful a budget is and how easy it is to make a one. Let’s look at exactly what a personal budget measures, how it does it, some benefits of creating and sticking with a budget, and some resources to help you get into the budget habit.
Fin Lit Trivia Fin Lit Trivia Fin Lit Trivia
Low Cost, High Cost The country with the lowest cost of living is India, followed by Moldova, Pakistan, Kazakhstan and Nepal. The most expensive places to live are Bermuda, Switzerland, The Bahamas, Norway, and Iceland.
Chapter 14 | The Beauty of the Budget 264
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