Income and Wealth
Something that a person or company owns that has monetary value.
What is an asset?
A bank account designed for saving money that you don't plan to spend right away
What is a savings account?
The price you pay to borrow money, or the amount you earn on your savings.
What is interest rate?
A company-sponsored retirement plan that allows employees to save money with tax benefits.
What is a 401(k)?
A financial security that represents partial ownership in a company
What is a stock?
Something that a person or company owes, usually a sum of money.
What is a liability?
A bank account that lets you deposit and withdraw money for everyday use
What is a checking account?
Interest that's calculated on an account's principal plus any interest that has already accumulated.
What is compound interest?
An individual retirement account where contributions are pre-tax, but taxed on withdrawal
What is a Traditional IRA?
A stock market index tracking the stock performance of 500 of the largest companies listed on stock exchanges in the United States.
What is the Standard & Poor's (S&P) 500?
The money or value that a person or business receives for providing a service or good, or for investing capital
What is income?
A bank account that pays higher interest rates than a traditional savings account
What is a High Yield Savings Account (HYSA)?
A strategy of investing a set amount of money regularly, regardless of stock prices.
What is dollar cost averaging?
A individual retirement account where contributions are post-tax, but not taxed on withdrawal
What is a Roth IRA?
A type of investment fund that tracks a market index, such as the S&P 500 or the Nasdaq 100.
What is an index fund? (as compared to an actively management fund)
The total value of all assets owned by a person, community, company, or country
What is wealth?
An account that lets you buy and sell securities, like stocks, bonds, and mutual funds.
What is a brokerage account?
How investors divide their portfolios among different assets e.g. stocks, bonds, etc.
What is asset allocation?
A benefit that allows employees to pay for certain health care and dependent care expenses with pre-tax dollars
What is a Flexible Spending Account (FSA)?
A collection of assets such as stock, bonds or other securities that trade on a stock exchange like a stock.
What is an Exchange Traded Fund(ETF)? (similar to a mutual fund but that trades at end of day)
The value of all of one's assets subtracted by the total of one's liabilities.
What is Net Worth (financial)?
A type of savings account that pays a fixed interest rate on money held for an agreed-upon period of time.
What is a Certificate of Deposit (CD)?
Adjusting your investments to match your desired asset allocation
What is rebalancing?
An investment account that lets you save for medical expenses, if you have high deductible health plan
What is a Health Savings Account (HSA)?
A security that pays back the face value of the loan at maturity and pays periodic interest payments along the way
What is a bond?