1. BUDGETING Chapter 6

2. True or False ä Financial success depends on luck more than planning. ä Spending small amounts of money now will not affect your long-term financial success. ä Your spending decisions do not affect anyone but yourself.

3. Budget (Financial Plan) ä Orderly program for spending, saving, and investing the money you receive. ä Based on short-term and long-term goals. ä Should save at least 10%

4. Financial Records ä Track your spending ä Keep income tax returns for 3 years ä Establish a Filing System (receipts, pictures, check stubs, bank statements, personal property inventory)

5. Statement of Net Worth ä Assets ä Liabilities ä A>L = Solvent ä A<L = Insolvent

6. Budget Worksheet ä Expected and Actual Income (1 month) ä Fixed Expenses ä Variable Expenses (Flexible) ä Savings ä Example on pg. 201

7. Vacation ä Reservation ä Travelers checks ä Overbooking ä Itinerary

8. Definitions ä Gross Pay ä Disposable Income (after taxes) ä Discretionary (after bills) ä Budget Deficit ä Budget Surplus