BANKING
What is the difference between a checking and savings account?
A checking account is for everyday spending, while a savings account is for storing money and earning interest.
What is insurance?
This is a contract where you pay a company to protect you financially in case something bad happens.
What is debt?
This is a borrowed amount of money that you are expected to pay back, usually with interest.
What is investing?
This is the act of putting money into something with the expectation of earning more money over time.
What is a budget?
This is a plan for how you will spend and save your money over a certain period of time.
What is an overdraft fee?
A fee that is charged when you spend more money than you have in your bank account.
What is renter's insurance?
This type of insurance protects your belongings (like a laptop) if they’re stolen or damaged in an apartment or dorm.
What is a credit score?
This three-digit number represents your creditworthiness and affects your ability to get loans or credit cards.
What is a stock?
This represents partial ownership in a company and can increase or decrease in value.
What is a fixed expense?
This type of expense stays the same each month, such as rent or a phone bill.
What is a maintenance fee?
Many banks waive this monthly fee if you maintain a minimum balance or are a student.
What is a deductible?
This is the amount you pay out of pocket before your insurance starts to cover costs.
What is interest (or interest rate/APR)?
This is the cost of borrowing money, usually shown as a percentage of the amount you owe.
What is a dividend?
This is money a company pays to shareholders, usually on a regular basis, as a reward for owning its stock.
What is a variable expense?
This type of expense can change from month to month, such as food, entertainment, or shopping.
What is APY?
This is the percentage a bank pays you each year for keeping money in a savings account.
What is a premium?
This is the monthly amount you pay to keep your insurance policy active.
What is credit utilization?
This term describes how much of your available borrowing capacity you are currently using.
What is diversification?
This term describes spreading your money across different types of investments to reduce risk.
What is the 50/30/20 rule?
This budgeting rule suggests spending about 50% on needs, 30% on wants, and 20% on savings or debt repayment.
What is the Federal Deposit Insurance Corporation (FDIC)?
This U.S. government agency protects your bank deposits up to $250,000 if your bank fails.
What is comprehensive insurance?
This type of insurance covers events like theft, fire, or natural disasters—but not collisions.
What is the credit system?
This financial system is based on trust and repayment over time, where lenders assess risk to decide who can borrow and at what cost.
What is investment risk?
This refers to the possibility that an investment will lose value due to market changes or uncertainty
What is net income (or surplus/deficit)?
This is the difference between the money you earn and the money you spend.