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________ ____________ is money received from various sources
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Terms in this set (35)
Sometimes _________ may get off track -This will help you notice if there is a problem or if you should make an adjustmentsplansIf a plan becomes unachievable or too restrictive _________ ___!adjust it________ is a forecast for future cash, inflows, and outflows -___________ provides guidance for reaching your personal goalsbudgetlist the steps of creating a budgetCreate a personal cash flow statement Turn cash flows statement into a budget Working with and improving your budget____________ your current cash inflows and cash outflowsIdentifyThink of how cash flows might ___________ from month to month -irregular expenses (Vacation, Christmas) -unexpected expenses (Emergencies, Repairs)changeAn _____________ ____________ helps you identity times where you can save money and times when you will be spending more moneyannual budgetA budget will help you save money for:major purchases unexpected expenses unexpected opportunities____________ ________ is a difference between what you forecast to what happened and what actually happened -evaluate forecasts and compare those with actual cash flowsforecast error_____________ ____________ __________ is a statement that tells you what your financial position is at a point in timepersonal balance sheetThere's two sides to a personal balance sheet:Assets Liabilities____________ _________ are necessary for covering unexpected or emergency expenses -Cash, checking account, savings accountliquid assets_______________ __________ are assets owned by a household -Car, houses, furniturehousehold assets____________ ________ is what something would be worth if you sold it today -What it is worth todayMarket value______________ are something you acquire with making money with money -the risk of loss is usually spread across many different _______________investments_________ are certificate that function IOU's it is a promise to repay a certain amount of money at some future time -loaning money -little risk little rewardbonds_________ are certificates representing partial fractional ownership of a firm -people buy this expecting that the company will do well and the value will increase -It may decline so it is a riskStocks________ ________ are managed by professionals who decide what stocks/bonds to purchaseMutual funds________ _________ is homes, rental property, farms, other landReal estateLiabilities can be put into two categories:Current Liabilities long term Liabilities_________ ____________ are debt that must be paid off in a yearCurrent LiabilitiesA _________ _________ acts like a short term loan that should be paid off every MONTHCredit card________ ________ ____________Is debt that will take longer than one year to pay off -student loans, car loans, home mortgages -each payment includes an interest component and some amount that will reduce the initial liability principlelong term Liabilities_______ __________ is the difference between your assets and your liabilities -Figuring out your net worth is an easy way to measure your own wealthnet worth____________ use a debt to asset ratio to determine if you have borrowed too much money -cash inflows that exceeds cash outflows you will either increase assets reduce liabilitieslenders