Envelope Budgeting for Teens

Front

What is envelope budgeting?

Back

A budgeting method where cash is divided into envelopes for different spending categories.

Front

How should you handle variable expenses in envelope budgeting?

Back

Overestimate the amount.

Front

What is the 50-30-20 rule?

Back

A budgeting guideline that suggests allocating 50% of income to needs, 30% to wants, and 20% to savings.

Front

What percentage of income should be saved according to the 50-30-20 rule?

Back

20%.

Front

What is a budget?

Back

A plan for how money will be used.

Front

What is a fixed expense?

Back

An expense that does not change from month to month, such as rent.

Front

What is a variable expense?

Back

An expense that can change from month to month, such as groceries.

Front

What is the purpose of a savings account?

Back

To save money while earning interest.

Front

What is a credit card?

Back

A card that allows you to borrow money up to a certain limit to make purchases.

Front

What is a debit card?

Back

A card that deducts money directly from your checking account to pay for purchases.