Intro to Pers Fin
This refers to all the financial decisions an individual or family must make to earn, budget, save & spend money over time.
What is personal finance
Saving money over time for a large purchase
What is a sinking fund
A written cash flow plan
What is a budget
A yearly fee that's charged by the credit card company for the convenience of the credit card
What is an annual fee
A type of higher learning school that focuses on job skill training for specific career fields rather than academics in liberal arts.
What is trade school
A person or organization that buys/uses goods or services
What is a consumer
The five steps to financial success
What are the Five Foundations
An item that is bought without previous planning or consideration of the long-term effects
What is an impulse purchase
A measure of an individual's credit risk; calculated from a credit report using a standardized formula
What is a Credit Score
A money myth that portrays student loans as the only financial option when it comes to funding one's college education.
What is "good debt"
A fee paid by a borrower to the lender for the use of borrowed money
What is interest
A savings account that is set aside to be used only for emergency expenses
What is an Emergency Fund
Occurs when money is withdrawn from a bank account and the available balance goes below zero
What is an overdraft
Cost of borrowing money on an annual basis; takes into account the interest rate and other related fees on a loan
What is an Annual Percentage Rate
Feeling regret or concern after making a large purchase
What is buyer's remorse
An obligation of repayment owed by one party (debtor/borrower) to a second party (creditor/lender)
What is debt
A rate which is either charged (on debt) or paid (on investment accounts) for the use of money
What is interest rate
A cash flow plan that assigns an expense to every dollar of your income, wherein the total income minus the total expenses equals zero
What is a Zero-based Budget
A decrease or loss in value
What is Depreciation
A developmental partnership where one person shares knowledge, skills, and perspective to foster the personal and professional growth of someone else.
What is mentorship
A system by which goods and services are produced and distributed
What is economy
The persistent increase in the cost of goods and services or the persistent decline in purchasing power of money
What is inflation
Series of envelopes that are divided into categories (food, entertainment, gas, etc.) and are used to store cash for planned monthly expenses
What is the Envelope System
Preferred method of debt repayment; includes a list of all debts organized from smallest to largest balance; minimum payments are made to all debts except for the smallest - which is attacked with the largest possible payments
What is Debt Snowball
Refers to the financial opportunity that is given up because you choose to do something else with your money.
What is opportunity cost