Budgeting

Question 1

What is a budget?

Answer 1

A plan for spending money

Question 2

Advantages of a household budget

Answer 2

Prevents overspending
Provides for unexpected expenses
Provides security, reduces stress
Sufficient funds during periods of high expenditure
Encourages saving
Limits use of credit
Develops money management skills

Question 3

Percentage to spend on food

Answer 3

25%

Question 4

Percentage to spend on housing

Answer 4

25%

Question 5

Percentage to spend on household expenses

Answer 5

15%

Question 6

Percentage to spend on clothes

Answer 6

10%

Question 7

Percentage to spend on transport

Answer 7

10%

Question 8

Percentage to spend on health

Answer 8

5%

Question 9

Percentage to spend on leisure

Answer 9

5%

Question 10

Percentage to spend on savings

Answer 10

5%

Question 11

Steps to creating a budget

Answer 11

List all sources of income
Calculate the yearly expenditure
Incorporate savings
Allow extra finance for times of high expenditure
Review regularly

Question 12

MABS

Answer 12

Money Advice and Budgeting Service
Free, confidential, independent service for people in financial difficulty
Supports clients to deal with their debts, draw up realistic budgets, maximise incomes