Budgeting Basics

What is the first step Debra takes to manage her finances?

• Creating an emergency fund

• Reducing her expenses

• Investing in stocks

• Calculating her net income

What are examples of fixed expenses?

• Entertainment, groceries, gas

• Mortgage, insurance, car loans

• Investment income, bonuses, wages

• Utilities, cell phone bills, cable bills

What are variable expenses?

• Costs that remain constant every month

• Expenses that fluctuate each month

• Fees for fixed services like internet

• Initial setup costs for utilities

How can Debra use her net income?

• To build an emergency savings account or invest

• To pay off debts

• To increase her spending on entertainment

• To loan money to friends

What should Debra do if her expenses are higher than her revenue?

• Increase her fixed expenses

• Ignore her financial situation

• Reduce her variable expenses

• Borrow more money

What is the difference between having a budget and not having one, according to the video?

• Having a budget means spending more money irresponsibly

• Having a budget leads to financial stability and responsibility

• Not having a budget helps in saving money easily

• Not having a budget leads to increased income

Revenue, or income, is typically a consistent amount each month.

• True

• False