What do you call...
Money collected by the government to fund services?
Taxes.
True of False: A bank account is a safe place to keep your money.
True: It is better to keep your money in bank keeping it all in cash at home.
Explain one reason people use banks.
People use banks to keep their money safe, save for future goals, deposit paychecks, pay bills, or access money through a debit card or ATM.
True or False: A security deposit covers the rent for the first month when moving into an apartment.
False
Name four expenses you will likely have to pay for in college besides tuition.
A plan for how you spend & save money?
A budget.
True or False: A higher credit score usually makes it easier to qualify for loans with lower interest rates.
True: Lenders often offer better loan terms to borrowers with higher credit scores.
Explain the difference between Credit & Debit
Debit is money that comes straight from your bank account, while credit is money that is borrowed & to be payed later.
True or False: A lease is designed to protect the rights of both a tenant and a landlord.
True
Why is it important to create a budget while you're in college?
A budget helps you manage your money, pay for necessities, avoid overspending, and reduce the chance of going into unnecessary debt.
Money that you borrow from a person, bank, or organization and agree to pay back later?
A loan.
True or False: A debit card lets you borrow money from the bank that you pay back later.
False: A debit card uses money already in your bank account. A credit card lets you borrow money.
Explain what a fixed expense is and provide 2 examples.
A recurring bill or cost that stays the same amount every time you pay it. (Eg. Rent, Insurance plans, etc.)
What is the agreement between a renter and a landlord?
Lease
What is the difference between a scholarship and a student loan?
A scholarship is money you usually do not have to repay, while a student loan is money you borrow and must repay, often with interest.
A document that summarizes all transactions in your bank account over a specific period.
A bank statement.
True or False: If you only make the minimum payment on a credit card, you may end up paying more in interest over time.
True: Paying only the minimum means interest continues to accumulate on the remaining balance.
Explain the difference between Gross & Net pay.
Gross pay is the total amount of money earned from a job before taxes (or deductions) are taken out, while Net pay is the actual amount of money received in a paycheck/account once taxes (or deductions) are taken from your earnings.
True or False: Renters insurance can help cover your personal belongings if they are stolen or damaged in a covered event.
True
Name three expenses a college student living off campus might have besides rent.
What refers to money held to cover possible damage in an apartment?
Security Deposit
True or False: Investing in a single company's stock is usually less risky than investing in a diversified mutual fund.
False: Diversification spreads risk across many investments, making it generally less risky than owning one stock.
Explain how compound interest can help your savings grow over time.
Compound interest helps your savings grow because you earn interest on both the money you originally saved and the interest you've already earned. Over time, this causes your savings to grow faster. The earlier you start saving, the more time compound interest has to increase your money.
What type of mortgage has a very large final payment?
Balloon Mortgage: a home loan featuring lower-than-average monthly payments for a short, set period (typically 5 to 7 years). At the end of this term, the remaining principal balance comes due as one large "balloon payment."
Imagine you receive a $2,000 refund check from your financial aid after tuition is paid. What are three smart ways you could use that money?