Saving & Spending
The amount of money a person or household owes to creditors, such as credit card companies or banks
What is debt?
The standard IRS form used by taxpayers for their annual tax return
What is a 1040 form?
The required amount that was not paid by the due date
What is the past due amount?
A rise in prices over a given period of time
What is inflation?
The tool that helps people create a plan for their income and expenses, and track their progress over time
What is a budget?
The measure of the degree to which a person's spending and savings habits are in line with their long-term financial goals
What is financial responsibility?
Tax policy in which the tax rate decreases as the amount subject to taxation increases
What is a regressive tax system?
Simple interest formula
What is I=PxRxT?
A federal program that provides benefits to many Americans, including disabled individuals, persons 62 and older, and military families
A stock that's price is affected by changes in the overall economy
What is cyclical stock?
The name of the savings approach that involves saving a fixed percentage of one's income, regardless of how much or little one earns
What is the 50/30/20 rule?
The practice of shifting profits or assets to low-tax jurisdictions to reduce tax liabilities
What is tax avoidance?
An unsecured credit card requires a cash deposit to guarantee a credit line.
What is false?
Apportioning funds among a variety of assets to minimize potential risk
What is diversification?
The yearly interest rate you’ll pay if you carry a balance, and it often varies from card to card
What is an annual percentage rate (APR)?
Earned not only on the principal amount of a loan or investment but also on any interest earned on that principal amount over time
What is compound interest?
Doctrine that requires tax laws to be written clearly and unambiguously so that taxpayers can understand their obligations
What is the rule of lenity?
Easier approval by landlords, better car insurance rates, better chance of approval for higher borrowing limits, and lower interest rates on credit cards and loans
What are the benefits of good credit?
-Retirement plan offered only by public school employees and some nonprofits
-Employees make pretax contributions
-Employees have the benefit of additional tax-free funds accruing
What is TSA (Tax-Sheltered Annuity)?
The type of investment that pools money from many investors to buy stocks, bonds, or other assets
What is a mutual fund?
Money market, online, basic, and certificates of deposits (CDs)
What are the types of savings accounts?
Artwork and collectibles, Cryptocurrencies, Stocks and bonds, Real estate, Vehicles and equipment
What are examples of capital assets?
Credit card accounts, home equity lines of credit (HELOC), and debit cards
What is open-end credit?
The following investments can be ranked in order of risk. (1=lowest risk, 4=highest)
Cryptocurrency, Savings Account, Stocks, CDs
What is 4 for Cryptocurrency, 1 for Savings Account, 3 for Stocks, and 2 for CDs?
The law that requires lenders to disclose the full cost of a loan, including interest rates and fees, to borrowers
What is the Truth in Lending Act?