International Baccalaureate (IB) Practice Exam

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Prepare for the International Baccalaureate Exam with comprehensive quizzes including multiple choice questions and detailed explanations to boost your confidence. Hone your skills with our expertly crafted materials!

Each practice test/flash card set has 50 randomly selected questions from a bank of over 500. You'll get a new set of questions each time!

Practice this question and more.

"Pay yourself first" is best described as?

Spending your income before saving
Assigning a portion of your income to saving and investing
Taking out loans for expenses
Not saving at all

The correct answer is: Assigning a portion of your income to saving and investing

The concept of "paying yourself first" revolves around the financial principle of prioritizing savings and investments before addressing other expenses. This approach emphasizes the importance of setting aside a predetermined amount of money as soon as income is received, rather than waiting until all expenses are covered. By allocating a portion of income directly to savings and investments, individuals can build wealth over time, ensure financial security, and work towards their long-term financial goals. This strategy can lead to more disciplined financial habits and can help individuals avoid the common trap of spending their entire income on discretionary items before considering their savings. By making savings a priority and treating it like a non-negotiable expense, individuals create a more sustainable financial future.