Vocabulary
Extra money paid to the bank for money borrowed
What is interest?
I=PxRxT
A bank account used to write checks for payment; allows for use of a debit card
What is a checking account?
Choose a bank
Pick either a savings account, checking account or both
Go online and fill out their online application
Make the required (small) initial deposit
What steps I need to take to open a bank account
You put $5,000 in a simple interest-bearing account. If the annual interest rate it 3.5%, what will your account balance be in 10 years if you do not make any additional deposits?
$6,750
A sum of money increasing over time.
What is accrue?
A=P(1+r)^t
What is the formula for compound interest?
A bank account that earns interest
What is a money market account?
amount of money borrowed from a bank
What is a loan?
$41,700 at 3% for 2 years, what will I have in 2 years?
$44,303.00
The amount of money currently in an account
What is balance?
(3,000)(0.01)(1)
What is simple interest formula?
What is a savings account?
What is a good percentage of your pay to save?
10%
$6,000 at 11% compounded quarterly for 3 years
$8,308.70
A bank account that earns interest
What is a money market account?
37,000 at 3% for 3 years
What is simple interest?
a document agreement to deposit money into an account for a set amount of time at a set interest rate
What is a certificate of deposit?
Money is required to stay in the account for a set amount of time
What is a CD?
If you invest $1,000 into a CD that earns 2.5% annual interest, compounded monthly, how much will be in your account in 5 years?
$1,133.00
interest calculated on the principal loan plus all accrued interest.
What is compound interest?
You invested 52,400 at 6% compounded annually for 5 years.
What is compounded interest formula?
a place to check grades, includes student id
What is a student account?
Which account type generally pays you more interest: one that pays its annual interest monthly or one that pays its annual interest quarterly?
Monthly
Twenty years ago you invested $50 in a Roth IRA that had an average annual return of 11% that was compounded monthly. How much is your account today?
$446.75