Banking 101
What is the primary purpose of a bank?
What is to accept deposits and make loans?
What is a checking account primarily used for?
What is day-to-day transactions and payments?
What is the term for the cost of borrowing money, typically expressed as a percentage?
What is interest?
What is the "pay yourself first" savings strategy?
What is automatically saving a portion of your income before spending?
What is the difference between a debit card and a credit card?
What is a debit card withdraws money from your account, while a credit card borrows money?
What type of account typically earns interest on deposits?
What is a savings account?
What type of account usually offers higher interest rates in exchange for higher minimum balances?
What is a money market account?
What is the difference between simple interest and compound interest, and how does each affect the total amount repaid on a loan?
What is simple interest is calculated only on the principal amount, while compound interest is calculated on the principal and any accumulated interest, leading to a higher total repayment amount over time?
What is a common recommendation for an emergency fund?
What is to save three to six months’ worth of expenses?
What is the purpose of a credit score?
What is to assess an individual's creditworthiness?
What is the name of the online banking service that allows customers to manage their accounts?
What is online banking?
What type of account typically has a higher interest rate but restricts access to funds for a set period?
What is a certificate of deposit (CD)?
What is the difference between fixed and variable interest rates?
What is a fixed rate stays the same, while a variable rate can change?
What is compound interest?
What is interest calculated on both the initial principal and the accumulated interest?
What does it mean to diversify your investments?
What is spreading investments across different assets to reduce risk?
What is the term for money that you owe to a lender?
What is debt?
Which account allows you to save money for retirement with tax advantages?
What is an IRA (Individual Retirement Account)?
What does APR stand for in relation to loans?
What is Annual Percentage Rate?
What is the 50/30/20 rule in budgeting,
allocates 50% of income to needs, 30% to wants, and 20% to savings and debt repayment,
How many states teach Financial Literacy?
35
What does FDIC stand for?
What is the Federal Deposit Insurance Corporation?
How much does the average American have across all their accounts?
$62,410
What is collateral?
What is an asset pledged as security for a loan?
How can inflation impact the effectiveness of a savings account, and what strategies can be employed to mitigate this effect?
What is inflation erodes the purchasing power of money saved, making it important to seek higher-interest accounts or invest in assets that typically outpace inflation, such as stocks or inflation-protected securities?
How much does the average family spend on groceries per week?
$270