Credit
The smallest amount of a credit card bill that a credit card holder must pay during a billing cycle to remain in good standing with the lender
Minimum Payment
An account that lets individual investors trade stocks, bonds, mutual funds, and other investments.
What is a Brokerage Account
Any items subtracted from your paycheck, including state and federal income taxes, Social Security, health insurance or 401(k) contributions
What is a deduction?
The amount of money you have in your bank account
Balance
A strategy where you save a specified amount of your paycheck before doing anything with the rest of your money
What is Pay Yourself First
The cost you pay each year to borrow money, including fees, expressed as a percentage
Annual Percentage Rate (APR)
The practice of investing in a large variety of stocks, bonds, and/or funds as a way to reduce your overall risk.
What is Diversification
An automatic electronic deposit of net pay to an employee's designated bank account
What is Direct deposit?
Automatic Teller Machine. Allows a person to manage a bank account holder's funds through actions such as withdrawing or depositing money, viewing account balances, etc.
What is an ATM?
A plan of your expected income and how you will use it to meet your expected expenses over a period of time
What is a budget?
A three-digit number (ranging from 300-850) based on an individual's credit history detailed in a credit report
What is a credit score?
A collection of stocks and/or bonds that are traded on securities exchanges. Unlike mutual funds, they can be traded throughout the day like an individual stock.
What is an Exchange-Traded Fund (ETF)
A form completed by an employee to indicate his or her tax situation (exemptions, marital status, etc.) to the employer, who then withholds the corresponding amount of taxes from each paycheck
What is the W-4 Form
A bank product that earns interest on a lump-sum deposit that's untouched for a predetermined period of time
Certificate Of Deposit (CD)
A budgeting method that allocates 50% to needs, 30% to wants, and 20% to savings and debt repayment
What is a 50/30/20 budget?
A person who has permission to use and/or carry another person's credit card, but isn't legally responsible for paying the bill
Who is an Authorized User
An individual retirement account that allows a person to set aside after-tax income up to a specified amount each year
What is a Roth IRA
A retirement savings plan, sponsored through your employer who will often match your contributions, that allows an individual to save for retirement
What is a 401K plan?
Reinvesting earned interest back into the principal, so that interest is calculated on both the initial amount and the accumulated interest
Compound Interest
A cost that appears irregularly or that changes in amount (e.g., utility bills)
What is a Variable Expense
A measurement of your outstanding debt divided by your total available credit; a general rule of thumb is to keep this under 30%
What is Credit Utilization Rate
A collection of financial investments like stocks, bonds, commodities, cash, and cash equivalents, including mutual funds and ETFs
What is a Portfolio
A labor market where the majority of people have short-term jobs or gigs such as freelancing and temp jobs rather than long-term employment
What is Gig Economy
A written, dated, and signed order to the bank that tells it to pay a definite sum of money to a payee
Check
When your expenses exceed your income
What is a Deficit