ECONOMICS
BUDGETING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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activities that contribute to overspending.
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things that are considered needs.
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activities that are necessary for a healthy lifestyle.
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things to consider when creating a budget.
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Detailed explanation-1: -Needs are those bills that you absolutely must pay and are the things necessary for survival. These include rent or mortgage payments, car payments, groceries, insurance, health care, minimum debt payment, and utilities. These are your “must-haves."
Detailed explanation-2: -A budget helps create financial stability. By tracking expenses and following a plan, a budget makes it easier to pay bills on time, build an emergency fund, and save for major expenses such as a car or home. Overall, a budget puts a person on stronger financial footing for both the day-to-day and the long term.
Detailed explanation-3: -Allow up to 50% of your income for needs You should aim to spend no more than 50% of your after-tax income on basic necessities, which may include: Rent/mortgage. Bills (water, electricity, gas, broadband, council tax, mobile phone) Food (essentials)
Detailed explanation-4: -Step 1: Calculate your net income. The foundation of an effective budget is your net income. Step 2: Track your spending. Step 3: Set realistic goals. Step 4: Make a plan. Step 5: Adjust your spending to stay on budget. Step 6: Review your budget regularly.