Tutor profile: Kyle E.
Subject: Personal Finance
How do you make a monthly budget?
The first step to making a budget is finding how much take-home (after taxes) money you make a month. After that, you'll want to write down your expenses starting with fixed expenses like rent, internet, car bill, and any other expenses that don't change from one month to the next. You will subtract those fixed expenses from your take-home pay and what you have left is available for variable expenses like groceries, entertainment, or charitable giving. These variable expenses can be set by you but may take a few months to find the right amount. Now all you need to do is track your spending and make sure you stick to your budget.
Why does everyone rushing to buy toilet paper raise the price of toilet paper?
Everyone buying toilet paper at once means that the demand for toilet paper has risen drastically. The toilet paper seller would like for everyone who needs toilet paper to get enough to cover their needs while making the most amount of money possible. To achieve this the seller will raise the price so that everyone only buys what they need and not any extra. The seller will raise and lower the price until he reaches a point where the number of buyers at a price matches the number of toilet paper rolls; once the last roll is sold no one will want to buy another roll even if there was more in stock.
Why does it make sense to always take out a subsidized student loan?
Subsidized student loans do not gain interest until after the borrower has finished their grace period after graduation. Given the time value of money (i.e. what this money could gain while in a no-risk or low-risk investment against inflation) this money will always gain value over this period of time and can be paid back with the profits being kept by the borrower. If the borrower does not invest this money they can keep it as a financial cushion and then pay it back once their grace period is over.
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