Banking Tips
What is your credit score?
It's a score that determines how much the bank trusts you for loans.
What is a stock?
A share of ownership in a company that can be bought or sold.
What is a budget?
A plan for how you will spend and save your money each month
What is a 401(k)?
A retirement savings account often offered by employers, sometimes with a matching contribution
What is insurance?
A product you pay for regularly that helps cover large unexpected costs
What is a debit card?
Your money stored in the bank, that you can use digitally.
What is a dividend?
A portion of a company's profits paid out to its shareholders.
What is the 50/30/20 rule?
A budgeting method that splits income into needs, wants, and savings at these percentages.
What is Social Security?
A government program that provides monthly income to retirees based on their work history
What is a deductible?
The amount you pay out-of-pocket before your insurance kicks in
What is the difference between net worth and income?
What is diversification?
The strategy of spreading investments across different assets to reduce risk.
What is an emergency fund?
Savings set aside specifically to cover unexpected expenses like car repairs or medical bills
What is a Roth IRA?
A retirement account where you contribute after-tax money and withdrawals in retirement are tax-free
What is identity theft?
When someone illegally uses your personal information to open accounts or make purchases
What is the APY?
Annual Percentage Yield is the real rate of return you earn on a savings account in one year, including the effect of compounding interest.
What is compound interest?
This type of interest earns returns not just on your principal, but also on previously earned interest.
What is a fixed expense?
A bill that stays the same amount every month, like rent or a car payment
What is the Rule of 72?
Divide 72 by your interest rate to estimate how many years it takes to double your money
What is a beneficiary?
The person you name to receive your life insurance or retirement account if you pass away
What does a HYSA stand for & what does it do?
It stands for a High-Yield Savings Account, and is designed to maximize interest earnings on cash deposits while maintaining safety and high liquidity.
What is an index fund?
A low-cost investment fund that tracks a market index like the S&P 500 rather than being actively managed
What is discretionary income?
The money left over after paying all taxes and necessary living expenses
What is asset allocation?
The strategy of adjusting the mix of stocks, bonds, and cash in your retirement portfolio based on your age and risk tolerance
What is phishing?
A scam where someone pretends to be a trusted company via email or text to steal your personal or financial information.