credit vs debit
an amount took from a bank account
Debit
the money you get for working every month
What is net monthly income
The basic economic problem of having unlimited human desires but limited resources
Scarcity
Expenses that change from month to month, like groceries, entertainment, or gas.
Variable Expenses
A number expression between 300 and 850 representing a person's creditworthiness
Credit Score
a card authorizing the holder to buy goods and services that can be payed for later
What is a credit card
Commonly called 'take-home pay,' this is the money left over after all taxes and deductions are subtracted
What is net income
The next best choice or alternative that you give up when you make a financial decision
Opportunity Cost
Expenses that stay the same every single month, like rent, insurance, or a car payment
Fixed Expenses
The percentage cost of borrowing money, or the reward rate for saving money.
Interest Rate
The maximum amount of money a credit card company allows you to borrow or charge to your account
What is a credit limit
The mandatory tax took sfrom your paycheck that funds the federal government's public services and operations
What is federal income tax
An economic system where production, prices, and incomes are determined by supply and demand in a free market.
Market Economy
budgeting method where every single dollar of your income is assigned to a specific category.
Zero-Based Budget
The financial phenomenon where you earn interest on both your original money and the interest it already racked up
Compound Interest
A card that looks like a credit card but operates like a cash is immediately subtracted from the cardholders bank account when a purchase is made
What is a debit card
This federal program is funded by FICA payroll deductions to provide retirement, disability, and survivor benefits
What is Social Security
Human, natural, and capital assets used to produce goods and services.
Resources
Money set aside specifically to cover unexpected costs like medical bills or urgent car repairs.
Emergency Fund
An investment strategy that mixes a wide variety of investments within a portfolio to reduce total risk.
Diversification
The three-digit security number printed on the back of most payment cards used to prevent fraud during online transactions
What is the CVV
Voluntary paycheck deductions used to save for retirement
What are retirement contributions
When countries rely on each other to trade goods
Global Interdependence
The ideal percentage of your net income that should go toward your "Needs" under the popular 50/30/20 rule
50%
The general rise in prices over time, which reduces the purchasing power of your cash
Inflation