Basics
Money you earn from working or from things you own that make money, like a business.
Income
A bank account that allows easy access to funds for everyday transactions.
Checking account
A small unit of ownership of a company; when the company makes or loses money, you also can make or lose money.
Stock
Money that the government charges people to pay for things like schools, roads, and public services.
Tax
Money you spend on things you need or want, like bills or snacks.
Expense
A bank account that earns interest over time and is typically used for storing money that you’re not going to use right away.
Savings account
The name for a distribution of profits by a company to individuals who own that company’s stock.
Dividend
A type of tax that you pay on the money you earn from working.
Income tax
Extra money you pay when you borrow money, or money you earn from saving it, usually shown as a percentage.
Interest
Occurs when money is withdrawn from a bank account and there are not sufficient funds to cover it.
Overdraft
A collection of all the different investments (like stocks and bonds) that someone owns.
Portfolio
An expense that can lower the amount of income that you have to pay taxes on, so you pay less in taxes.
Tax deduction
Money you owe because you borrowed it and need to pay it back.
Debt
The electronic transfer of a payment, often a paycheck, directly from the payer’s account to the recipient’s account.
Direct deposit
A way to lend money to a company or the government, who promises to pay you back with some extra money later. This is typically a low-risk investment.
Bond
An amount of money that is subtracted from the amount you owe when you file your taxes.
Tax credit
A payment type that creates a loan, meaning you have to pay back the purchase amount plus interest at a later time.
Credit Card
Money that you borrow and have to pay back later, usually with extra money on top called interest. An example of this is a mortgage.
Loan
A group of different investments that people put their money into together. Experts manage it to help the money grow, and it is considered to be less risky than investing in a singular stock.
Mutual fund
Money that is deducted from your paycheck before you receive it to automatically pay for things like taxes.
Withholding