Taxes
The tax percentage that applies to the last dollar of income earned
What is the marginal tax rate?
Another phrase for "net income"
What is "take home pay"?
What are non-income factors?
Gross OR Taxable
The amount of income subject to income tax under the law after deductions and credits
What is taxable income?
An important skill for financial success that allows you to plan for current and future expenses
What is budgeting?
Usually, employees and employers both that pay
Medicare tax of 1.45% of wages
(1.45% + 1.45% = 2.90%)
Social Security tax of 6.2% of wages
(6.2% + 6.2% = 12.4%)
However, this person pays everything themself (2.9% + 12.4% = 15.3% of wages) to FICA
What is the self-employed individual?
Calculated by multiplying the hours he worked by his total hourly rate.
What are gross wages?
Most branches offer advanced and specialty training, education, health benefits, and more
What is the military?
UNEMPLOYMENT or RECESSION
A severe downturn in the business cycle. A slowing or halt to economic growth which can stagnate or even lower wages, as businesses attempt to reduce costs to stay afloat. Employees may be let go, leading to higher rates of unemployment. Existing workers may work longer hours. With so many people looking for work, employers are less likely or willing to consider raises.
What is a recession?
Experts agree that you shouldn't spend more than ______ percent of your income on housing. This should also include maintenance, insurance, and property tax expenses.
What is 25%
In this tax system, as income increases, the percentage of taxes paid to the government also increases (The higher the income, the higher the tax)
What is a progressive tax system?
Total amount of paycheck after deductions.
What is net pay?
What are factors that affect income?
TAXES or DEBT
This is money borrowed from or owed to lenders.
What is debt?
This option means that you immediately take a percentage of your earnings into savings. Whatever is left can be used for expenses.
What is "pay yourself first?
The tax rate is the same for all income levels
What is a proportional tax system?
This table is an example of ___________________
10% on the first $9,525 of income
12% on taxable income over $9,525 to $38,700
22% on taxable income over $38,700 to $82,500
24% on taxable income over $82,500 to $157,500
32% on taxable income over $157,500 to $200,000
35% on taxable income over $200,000 to $500,000
37% on taxable income over $500,000
What are marginal tax brackets?
There is a direct relationship between _____________ and ______________. As your level of one of them increases, the potential of the other one also increases.
What are education and income?
DIRECT taxes or INDIRECT taxes
People pay gasoline taxes to gas stations. and pay sales tax to retail stores for things like clothing, phones, and internet.
What are indirect taxes?
___________ expenses do not change regularly. Expenses like rent, insurance, and internet services remain consistent once you have decided to make the purchase.
_________ expenses are more difficult to budget for because costs change consistently. You can more easily control these expenses because they are discretionary. You choose how much to spend on groceries, entertainment, or clothing.
What are fixed and variable expenses?
The tax rate is the same regardless of income
What is a regressive tax system?
With the opportunity to move all or some of a business's production overseas, jobs may be lost in the home country where the good or service originated. This is common in the tech industry, as it is often less expensive to pay foreign workers and obtain factory space to manufacture and assemble electronics in other countries.
What is globalization?
We make decisions every day, but every decision is affected by _______________ and ______________. These are the perceived negatives and the potential rewards associated with that decision.
What are costs and benefits?
TAXABLE or NET income
(gross income) - (deductions)
What is taxable income?
How risky it may seem for creditors to lend you money
What is credit worthiness?