| Budgeting | Credit | Saving | Financial Security |
|---|---|---|---|
|
Variable Need
Something needed to keep your standard of living, but may fluctuate in price each month
|
Utilization rate, average age of accounts, payment history, loans
What is one thing that can affect your credit score?
|
Roth and Traditional, or 401K and IRA
What are the two types of retirement accounts?
|
Amount of money set aside for times of difficulty or unexpected changes; funds should be enough to sustain an individual for 3 - 6 months
What is an emergency fund?
|
|
50% towards needs, 30% towards wants, 20% towards savings
What is each category of the 50/30/20 rule?
|
700-800
A good credit score is:
|
10-20%
What percentage of your earnings should you save per year?
|
Multiple possible answers
Name three saving and spending tips discussed in class last week
|
|
Biweekly to match pay cycles, or monthly
How often should you make/update a budget?
|
12-18%
On average, how much more do people spend when only using credit cards?
|
Either A or B would be recommended
What should the percentage of earnings saved be based on?
A) Pre tax amount B) Post tax amount C) Amount after fixed need expenses |
Wealth Erosion is the accumulation of debt or the withdrawal from one's base of funds for items that do not contribute to or are less likely to generate wealth
Some examples include: credit card debt, loan interest, high interest mortgage, etc.
Describe and provide examples of wealth erosion as it relates to personal finance
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