Household budgeting - JSS3 Home economics Past Questions and Answers - page 1
What is household budget ?
Household budget is a plan for future expenditures of a given household. Good budgeting leads to wise management or us of family resources/income.
State five budgeting terms .
1. Family income: The income of a family include the money and other economic resources available to the family for meeting their need. Family income could either be gotten daily, weekly, monthly or yearly.
2. Money income: This is the total amount of money which the family has at a given period. It is the purchasing or buying power of a family at a given period. If not used wisely, it will cost the family dearly.
3. Gross income: This is the amount of money from a persons income.
4. Net income: This is the amount of money that remains after deductions have been made, such as tax, water rate and levies. It can also be referred to as their disposable income.
5. Budget: This is the plan made of how to spend the family income. The budget is normally prepared based on the net income.
Mention 4 importance of family budgeting.
1. It helps the family to make wise decisions about expenses I.e, how their income is been spent on good and services.
2. It helps the family to spend money on what they really need I.e, prioritizing their needs before their wants.
3. It prevents wasteful spending of family money I.e to minimize wastage of resources.
4. It helps the family to see how they they spend their money ( helps them keep account on how their money was been spent).
What are the factors to consider in preparing a budget?
1. The family income
2. Family needs
3. Family size
4. Family value
5. The season of the year
6. Locality
7. Inflation
What is the purpose of a household budget?
to spend money impulsively
to track income and expenses
to maximize debt
to ignore financial responsibilities
Which step should be taken first when creating a household budget?
setting financial goals
tracking income and expenses
ignoring income sources
spending money without a plan
What is the term for the amount of money earned by an individual or household over a specific period?
debt
income
expense
savings
How does tracking expenses help in budgeting?
by increasing debt
by ignoring financial responsibilities
by identifying areas where money is spent
by overspending on unnecessary items
What is the purpose of categorizing expenses in a household budget?
to increase debt
to ignore financial responsibilities
to track spending patterns
to spend money impulsively