Accounts and Banking
What do you call the physical form of coins and paper money?
Cash.
What is a budget?
Budget — a plan for what you’re going to spend your money on.
Money you owe to someone else.
Debt — the amount you owe to someone else.
A request to your insurance company to pay for something.
Claim — a request to your insurance company to pay for something.
What is an "expense"?
Anything you spend money on.
What is a checking account primarily used for?
A checking account is primarily used for quick access to money for everyday expenses.
What term describes money earned through work?
Income — money earned through work.
The amount you borrow when using a loan or credit card.
Principal — the money you borrow when using a loan or credit card.
Amount you pay to a healthcare provider before insurance covers the claim.
Copay — the amount you pay to a healthcare provider before your insurance takes the claim, usually paid before you receive a service.
What does "balance" mean for an account?
Amount available in or owed on an account.
Define "deposit."
Deposit — when you turn your money over to a financial institution for safekeeping.
What is "net pay" on a paycheck?
Net pay — the amount of money left on your paycheck after taxes have been withheld.
The smallest amount you must pay to avoid fees or fines; prevents late penalties but may prolong interest accrual.
Minimum payment — the smallest amount you are required to pay on money you borrowed in order to avoid fees or fines.
Define "deductible" in an insurance policy.
Money you must pay toward expenses before insurance pays the rest.
What is a "pay stub" and what two pieces of information it commonly shows?
Document with paycheck showing amount paid and how much was withheld for taxes (and often deductions).
What does "clear" mean when referring to a bank transaction?
Clear — the time it takes for money to move from one account to another (e.g., from checking to cash, or from one checking account to another).
Describe "double entry accounting" in the context of personal budgeting.
Double entry accounting — a budgeting method where you record your earnings twice: once in your account and once in your budget (helps track actual vs. planned).
Define "interest" and give one example of how it affects borrowing.
Interest = charge for borrowing or amount paid when lending; e.g., interest increases total cost of a loan over time.
Explain the difference between tax and deductible
Tax = money paid to government for services; Deductible = part of insured expenses you pay before insurance covers remaining costs.
Define "lease" and give one everyday example when someone might sign one.
Contract to borrow property for a specified time and payment — e.g., apartment lease.
Explain the difference between "debit" and "credit" when used with bank accounts.
Debit — an amount removed from your bank or credit union account to pay for something. Credit — borrowing money to pay for something with the understanding you’ll pay it back, plus more, later.
Give two examples of household utilities and explain why they belong in a monthly budget.
Utilities examples: electricity and water — recurring monthly necessities that should be included in a monthly budget.
What is an "overdraft" fee and one behavior that can help avoid it?
Overdraft = bank fee when spending more than account balance; avoid by tracking balance or setting alerts/overdraft protection.
Provide one example how choosing a high deductible vs. low deductible affects monthly costs and potential out-of-pocket expenses (short rationale).
High deductible typically lowers monthly premium but increases potential out-of-pocket cost if you need care; low deductible raises monthly cost but lowers expense after a claim.
Explain "transfer" and describe one situation where transferring money between accounts is useful.
Transfer = moving money between accounts — useful for moving paycheck from checking to savings or paying a credit card from checking.