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6. Describe what a spending plan is.

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6. Describe what a spending plan is.

6. Describe what a spending plan is.

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WillowMaster · Tutor for 5 years

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A spending plan is a comprehensive financial plan that includes the income (money coming in), savings (money saved), and spending (money going out).

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## Step1: <br />A spending plan is a strategy that allows individuals to manage their financial resources effectively. It is a detailed financial plan that outlines how much money will be spent on different categories over a certain period of time.<br /><br />## Step2: <br />A spending plan includes various components such as income, savings, and spending. <br /><br />## Step3: <br />The income component refers to the money that is coming in, such as salaries, wages, or other sources of revenue. <br /><br />## Step4: <br />The savings component refers to the portion of income that is set aside for future use, such as retirement, emergencies, or major purchases. <br /><br />## Step5: <br />The spending component refers to the money that is going out for expenses, such as bills, groceries, entertainment, and other personal needs or wants. <br /><br />## Step6: <br />Therefore, a spending plan is a comprehensive financial plan that includes all of the above components.
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