Unit 4: Budgeting Vocabulary Flashcards

This set of vocabulary flashcards covers essential budgeting terms including income, expenses, pay types, and spending strategies.

Budget

A plan for how you will earn, spend, and save money.

Income

Money you receive from a job or another source.

Expense

Money you spend.

Needs

Things you must have to live, such as paying rent or buying groceries.

Wants

Things you would like to have but can live without, such as eating out or decorating a room.

Deficit

Spending more money than you earn, which can lead to debt.

Surplus

Having money left over after paying expenses.

Gross Income (Gross Pay)

Money earned before taxes and other deductions.

Net Income (Net Pay)

Money you take home after taxes and deductions.

Deduction

Money taken out of your paycheck before you receive your final pay (net pay) for items like taxes, health insurance, or retirement.

Salary

A fixed amount of money a person earns from a job, usually paid weekly, biweekly, or monthly, rather than by the hour.

Wage

Money earned by a person for the work they do, usually based on the number of hours worked.

Freelancer

A person who works for themselves and earns money by completing jobs for different clients instead of one employer.

Gig Economy

A type of work where people earn money by completing short-term jobs or tasks, like driving for a delivery app, instead of having a traditional job.

Variable Expense

An expense that changes from month to month, such as groceries, gas, or entertainment.

Fixed Expense

A cost that usually stays the same amount and must be paid regularly, such as rent, car payments, or phone bills.

50/20/30 Rule

A budgeting guideline that allocates $50\%$ to needs, $20\%$ to savings/debt, and $30\%$ to wants.

Cost of Living

The amount of money needed to pay for basic expenses like housing, food, and transportation in a specific area.

Unit Price

The cost of one item or one unit of something to help compare prices and find the best deal.

Wealth

The total value of what a person owns (assets) minus what they owe (debts).