Banking
What are the 3 functions of money?
- Medium of exchange
- Unit of account
- Store of value
What is a budget?
A way to balance income, expenses + financial goals for a specific length of time.
What is a credit card?
Account that represents short-term revolving loan
What is a premium?
Amount that you pay for insurance
What’s a stock?
Share of ownership in a company
What are 2 characteristics of money?
Options:
- Durable
- Portable
- Divisible
- Uniform
- Limited
- Accepted
What’s the definition of gross pay?
The amount of money an employee gets before taking away taxes
5 things to conside when applying for a credit card
1-Annual Fee
2-APR
3- Penalty rates
4- Late fees
5- Grace period
What is a deductible?
Amount that you pay before insurances benefits pay
What is a stock exchange?
Each place where stocks are bought and sold (physical and online)
What‘s the original form of money?
Shiny Stones
Name the methods of budgetin:
-50/20/30 budget
-Pay yourself first
-Zero-based budget
-Envelope budget
What is a credit score?
A credit score is a numerical value than indicates a person’s credit worthiness
How many stages does health insurance have?
3 stages
What’s a market index?
Hypothetical portfolio of investments holdings that represents a segment of the financial market
What institution did John Law create?
A real bank
What’s the 50/20/30 budget?
50% of your net income should go towards living expenses and essentials (Needs), 20% of your net income should go towards debt reduction and savings (Debt Reduction and Savings), and 30% of your net income should go towards discretionary spending (Wants).
Name 2 factors that affect your credit score
-Credit utilization
-Types of credit
-Credit history length
—New credit
What are the stages of health insurance?
Stage 1: Deductible
stage 2: your insurance starts paying
stage 3: When you reach your out-of-pocket maxi insurance pays everything
Ways to reduce investment risk
Long time horizon, mix of types of companies, spread buy over time
What city was named for Law’s friend?
New Orleans
How can you decide where to live? Name 3 factors to take into account
Options:
Cost of living, job availability , happines, crime, quality of educatio, commute, availability of healthcare
Name one credit reporting agency
Options:
-Equifax
-Exprerian
-Transunion
How much does an average overnight hospital stay cost?
About $11,700
What’s the greater fool theory?
Trying to make money on over-valued assets. Only works if there’s a greater fool than you, willing to pay even more.