Quiz: Budgeting Basics 4 questions · 80% to pass 1. In the 50/30/20 rule, what percentage of after-tax income goes to savings and debt payoff?50%30%20%10%The 50/30/20 rule allocates 20% of after-tax income to savings and extra debt repayment, 50% to needs, and 30% to wants.2. Which of the following is classified as a 'need' in the 50/30/20 framework?Streaming subscriptionsHealth insurance premiumsA vacation fundConcert ticketsHealth insurance is a need because going without it exposes you to catastrophic financial risk. The other options are wants.3. In zero-based budgeting, what should income minus all assigned expenses equal?At least $500 leftoverZero20% of incomeWhatever is left after billsZero-based budgeting assigns every dollar to a category, including savings and investments, so income minus all categories equals zero.4. What is the recommended first step before creating a budget?Open a new savings accountCancel all subscriptionsTrack all expenses for 30 daysSet up automatic bill payTracking expenses for 30 days gives you real data about your spending habits, making your budget realistic rather than aspirational. Check answers Retake quiz Back to lesson Next lesson →