Credit Scores
What is the range of credit scores?
300 - 850
This simple budgeting method involved dividing your income into different categories, often including needs, wants, and savings.
50/30/20 rule
All Debt is bad: True or False?
False: a mortgage and student loans are good debt they help build your financial future and diversify your type of debt
This type of retirement account is employer-sponsored, and contributions may be matched by your employer, making it a great way to save for retirement.
401(k)
This type of account allows you to easily deposit and withdraw money for everyday transactions, such as paying bills and making purchases.
Checking Account
This type of loan is often offered by the federal government to students based on financial need and typically has lower interest rates.
Federal Subsidized Loan
Buying things without having planned for them beforehand. It can cause you to spend more money than you can afford.
Impulse Purchase or Emotional Spending
Best way to improve your credit score quickly?
Paying bills on time.
This type of budgeting involves assigning a specific dollar amount to each category of spending for the month, like groceries, entertainment, and transportation.
Zero-Based Budget
True or False: When you receive your credit card statement you should pay your minimum payment in order to not accrue late fees
True: Minimum payment is all you have to pay in order to not have to pay late fees, but you will accrue interest towards your left over balance.
This type of savings account typically offers higher interest rates than a regular savings account, allowing your money to grow faster with minimal risk.
High - yield savings account
If you don’t have enough funds in your account to cover a transaction, the bank may cover the cost for you, but you will incur this fee.
Overdraft fee
This loan is offered by the federal government, but the borrower is responsible for paying the interest during school and after graduation.
Federal Unsubsidized Loan
This is the fee that financial institutions charge to lend you money. With savings, it refers to the money banks pay you when you deposit money.
Interest
What is one of the three major companies that track your credit history?
Equifax
Experian
TransUnion
This method involves using the envelope system, where cash is divided into envelopes for specific spending categories, ensuring you don't overspend in any area.
Envelope budgeting system
True or False: If given the option to consolidate your students loans, it will help you pay off your loans quicker and for a cheaper rate.
FALSE: Here are things you should know before -
This is the key to building wealth over time, which involves setting specific, measurable, and achievable targets for your finances, like saving for a home or a child’s education
Financial goals
This is the amount of money you must maintain in your account at all times in order to avoid monthly fees, typically required for both checking and savings accounts.
Bonus points if you get the average range correct!
Minimum balance
$50 - $100
This is the process of postponing student loan payments due to factors like financial hardship or returning to school.
Deferment
This action can hurt your credit score if you do it too often?
Hard inquiries - such as applying for too many credit cards in a short time.
This term describes the percentage of your available credit that you are currently using, which should ideally stay below 30% for good credit health.
Credit Utilization ratio
This type of budget is based on tracking your spending over time and adjusting it each month to stay on track. It’s useful for people who want flexibility in their budgeting.
Flexible budget
True or False: Credit cards will get me through financial crisis'
FALSE: Depending on credit cards to get you through a financial emergency is a great way to dig yourself into a deep pit of debt. Depending on your situation, you may not have the means to pay your cards on time, and with interest and late fees, you could be spending a lot more than you charged in the first place. Credit cards should not be relied on during a real financial emergency, such as a job loss, divorce, or serious illness. It’s best to proactively build an emergency fund consisting of three to six months’ worth of living expenses so you’re prepared for any unexpected events.
This financial strategy involves automating your savings by having a fixed amount of your paycheck directly deposited into your retirement account, savings account, etc.
Automatic payroll deduction
This method allows you to move money electronically between different accounts, such as transferring money from a checking account to a savings account.
ACH transfer (Automated Clearing House transfer)
This is a common method used to repay student loans, allowing you to make monthly payments based on your income after graduation.
Income-Driven Repayment (IDR) Plan
This term refers to the practice of combining several loans or credit card balances into a single loan to simplify repayment.
Debt consolidation
This is the time period after you’ve missed a payment when a lender might start reporting the late payment to the credit bureaus, affecting your score.
30 days
This strategy suggests paying yourself first, meaning you set aside money for savings or investments before you pay bills or buying anything.
pay yourself first method
True or False: It is ALWAYS worth saving even if I can only contribute a small amount
True: Any amount goes a long way in the long run
What is the recommended amount of money you should have in an emergency fund to cover unexpected expenses (ex. how many months)
3 months of living expenses
This type of account often requires a higher minimum balance but offers a higher interest rate than a regular savings account, making it ideal for long-term savings.
Money market Account
This program allows federal student loan borrowers to have their remaining debt forgiven after making 120 qualifying monthly payments while working in public service jobs.
Public Service Loan Forgiveness (PSLF)
percentage of your gross monthly income that goes toward debt payments. It's a key metric that lenders use to assess your ability to repay loans.
Debt-to-income