Banking
What is a deposit?
Adding or putting money into an account.
What is Budget?
A plan of your spendings and income
What is investing?
- buying assets that an individual thinks will grow in value
-risk your money = to make reward
-investing involves making informed decisions about how to make your money work for you, and how to balance risk and reward
What is credit?
Your score/ability to borrow money or services with the understanding that you'll pay for it later.
What is debt?
Money/assets you owe someone else.
What is a checking account?
A bank account that allows quick withdrawals and deposits, usually an unlimited amount of times but has low/0% interest rates.
The term used to describe the things you spend your money on.
What are expenses?
What is a savings account?
A bank deposit account with a interest rate that increases your money. It is more difficult to take money out compared to a checking account.
What is interest rate?
The amount lenders charge borrowers and is a percentage of the principal.
This may include your paycheck, investment, or business profit.
What is a source of income?
What is a stock?
A part ownership of a corporation (company) that is usually used as an investment.
What is the best way to improve your credit rating?
Fully pay your bills/debt on time
How does debt grow?
Through interest or by buying/borrowing more than you pay off.
What is one of the factors people use when choosing a bank?
Location, convenience, interest rates, or fees.
What are examples of Fixed Expenses?
Mortgage/rent, insurance, cell phone bills.
What does high risk mean for investing?
The value of the investment can change a lot.
What is an annual percentage rate (APR)?
The interest rate for a whole year (rather than monthly fee/rate) as applied on a loan, credit card, or mortgage.
What is one of the most common types of debt?
1. credit card
2. Medical bills
3. Student loans
4. House loans
What is the limit of money deposited in a bank that is insured by the FDIC?
250,000$
What do you call money spent that changes during a regular interval. (Examples: Groceries, Eating out, fun activities)
Variable Expenses
What is Certificate of Deposit (CD)?
A savings account that does not allow withdrawal of money before a specific time has passed without penalty. (Example: 6 months CD)
The total amount of money and assets you have and subtracting the total amount of money you owe.
What is your Net Worth?
How can debt affect your future?
Can give you a low credit score :
A low credit score impacts your ability to get a low rate on loans. Paying higher interest on loans impacts your available cash flow. Having bad credit can also affect your ability to get a job or your ability to rent an apartment or home.