Credit Cards vs Debit Cards
This type of card is linked to your bank account and withdraws money directly from it when used for transactions.
What is a debit card?
This loan is specifically used for purchasing a home loan
What is a mortgage loan?
This three-digit number, ranging from 300 to 850, is used by lenders to evaluate the risk of extending credit to an individual
What is a credit score?
This term refers to the interest rate that banks pay to individuals or institutions for keeping their money in savings accounts
What is the savings account account interest rate?
Creating a plan for managing your money, which involves tracking income and expenses, is known as this financial practice
What is budgeting?
You may have to pay interest on unpaid balances with this card type, while the other type does not charge interest.
What is a credit card?
This type of loan requires the borrower to pledge collateral, such as a house or car, to secure the loan
What is a secured loan?
This term refers to the total amount of available credit you have across all your accounts
What is credit limit?
This term refers to the percentage of a loan or credit card balance that is charged to the borrower as compensation for the lenders risk
What is an interest rate?
This term refers to a budgeting technique where expenses are tracked and categorized in real-time using software or apps
What is digital or electronic budgeting?
Unlike credit cards, debit cards are directly linked to this type of account, allowing for immediate withdrawl of funds
What is a checking account.
This type of loan is often used for short-term financing needs and typically has a higher interest rate than secured loans
What is an unsecured or personal loan?
This term refers to the number of times you apply for new credit, which can temporarily lower your credit score
What is credit inquiries?
This type of interest rate remains the same for the entire term of a loan or investment
What is a fixed interest rate?
Budgeting aims to avoid these types of unexpected expenses that can disrupt financial stability.
What are emergency (unplanned) expenses?
This fee is charged by some credit card companies for failing to make at least the minimum pament by the due date
What is a late payment fee?
This term refers to the process of combining multiple loans into a single loan with lower interest rate or lower monthly payments
What is loan consolidation?
This term refers to the length of time you have been using credit, including the age of your oldest and newest accounts
What is credit history?
This term refers to the interest rate that banks offer to their most creditworthy customers
What is the prime rate?
This type of budgeting allocates a fixed amount of money to each expense category and requires adjusting spending if one category exceeds its limit
What is zero-based budgeting
TThis term refers to the interest rate that applies to purchases made using a credit card
What is the purchase APR (Annual Percentage Rate)
This type of loan is typically used for short-term financing needs and is repaid in fixed installments over a specified period
What is an installment loan?
This factor, which accounts for about 30% of your credit score, considers the amount of debt you owe compared to your total credit limit
What is credit utilization ratio?
When interest is calculated based on the initial principal and the accumulated interest from previous periods, its known as this type of interest.
What is compound interest?
This term refers to a budgeting method where every dollar is assigned a specific purpose, ensuring that all income is accounted for and allocated
What is the envelope system?