1. Earning Money 10.01

2.  What is income and what are 3 possible sources?  Income is money that you have available to you to spend  3 sources: babysitting, part-time job, allowance

3. What is the difference between gross and net income?  GROSS: before taxes  NET: After taxes Employers- person or business who you work for Employee- the worker-person who works for a business a business

4. What is the difference between getting paid salaried vs hourly?  Salaried: same amount of money regardless of hours worked  Hourly: paid by hour- 7.00/hr x hrs worked

5. Spending Money  Budget: A plan for spending and saving money  Consumer: anyone who purchases and uses products

6. What are expenses? Name 2 kinds of expenses?  Items that you spend money on  Fixed:  Car payment, rent  Flexible:  Phone bill, credit card bill, electric bill

7. Why would I need a checking account?  A checking account helps you to manage your money and pay bills

8. What is a debit card?  Looks like a credit card; when purchases are made with this card money comes directly out of your checking account. (instead of writing a check, a debit card may be used.) With a debit card, you can go to the Automatic Teller Machine (ATM) and directly withdraw money form you checking/saving account.

9. Why would I need a credit card?  Credit cards can be helpful in establishing your credit so that you can finance a home or a car one day.  ** Dangers –High interest rates, monthly fees, etc. It is best to charge no more than one you can afford to pay off that same month.

10. What are loans? Why would I need loan?  Loans are when a bank lets you borrow money that you pay back with interest.  **Most loans are paid off monthly- A regular amount paid each month toward the loan.  **CREDITORS LEND MONEY-banks, credit card companies, etc.  **Finance fees- Money charged for borrowing money.

11. SAVING MONEY  When should you start saving money?  As soon as you start earning it!!!

12. What is a savings account, and what does it offer a depositor?  Allows limited access to your money and gains interest from the bank the longer it stays there.  ** When choosing a bank consider fees that the bank charges (monthly service fees)