Financial Planning & TVM Part 1
Assets - Liabilities = ?
What is Net Worth?
An expense that does not change month to month, such as a car payment or rent.
What is a fixed expense?
A tax that is paid based on the value of the real estate that you own
It is used for local services, mostly schools/education
What is a property tax?
Checking accounts, savings accounts, money market accounts, certificates of deposit
What are ways to store your cash?
The last step in the financial planning process
What is budgeting income and expenses?
A type of asset that is not valuable for what it is - aka it is not a physical asset you can sell.
What is an intangible asset?
The type of document that tells you where your money has come from and where it has gone.
What is an income statement?
A form that your employer sends you at the beginning of each year to help you file your tax return
What is a W-2?
The amount of money a college student should have saved, and the amount of money a professional should have saved.
What is $1000? What is 3-6 months worth of expenses?
A tax on specific goods like alcohol and cigarettes
What is an excise (sin) tax?
A type of financial goal that you want to accomplish in 1-10 years.
What is intermediate?
A type of budgeting tool that splits your expenses into percentages based on needs, wants, and savings.
What is the 50-30-20 method?
Ways to make money that include interest, capital gains, social security, etc.
What is unearned income?
ATM, minimum balance, overdraft, etc.
What are some of the common bank fees?
The number of states that do not have state income tax (including Texas!)
What is 7?
A type of financial security that involves struggling to provide essential items like food, shelter, and transportation.
What is basic needs security?
Definition: A dollar saved today is worth more than a dollar saved in the future.
What is the Time Value of Money?
The highest tax rate your taxable income is charged at.
What is marginal tax rate?
This tells you how much interest you would actually earn on an account over the year.
What is Annual Percentage Yield?
An institution that offers similar services to a bank, but is not for profit. It is member owned and shares profits through dividends (not interest)
What is a Credit Union?
-Present Security
-Present Freedom of Choice
-Future Security
-Future Freedom of Choice
What are the four elements of financial well-being?
Increasing your Assets and decreasing your Liabilities leads to more income.
What is the wealth cycle?
The annual gift tax exemption amount for single people.
What is $18,000?
The FDIC insures up to this much money per depositor in the event that a bank fails or is robbed
What is $250,000?
Any unnecessary, repeated expenditure.
What is the latte factor?