Money Basics
What is the paper and coin currency we use to buy goods and services called?
What is money?
What do we call a place that keeps your money safe and offers financial services?
What is a bank?
What’s the 50/30/20 rule used for
Budgeting (50% needs, 30% wants, 20% savings/debt)
What is the money taken from your paycheck by the government called?
What are taxes?
What does “ROI” stand for?
What is Return on Investment?
What is the cost of borrowing money, usually shown as a percentage?
What is interest?
What is the plastic card that lets you borrow money up to a limit called?
What is a credit card?
What’s the term for money you earn after taxes are taken out?
Net income
What’s the form you fill out every year to report your income to the IRS?
What is a tax return?
What’s the term for the profit you earn from investing?
What is Return?
What is the term for the amount of money you earn before taxes and deductions?
What is gross income?
What is a FICO score used to measure?
What is creditworthiness?
True or False: You should always pay your rent before spending on entertainment.
TRUE
What does “net income” mean?
Income after taxes and deductions.
What is a share of ownership in a company called?
What is a stock?
What does “budget” mean?
What is a plan for managing income and expenses?
What’s the difference between a debit card and a credit card?
Debit uses your own money; credit borrows money.
Name one app that helps track expenses.
Mint, YNAB, or EveryDollar
What is a W-2 form used for?
To report yearly wages and taxes withheld.
What’s the difference between stocks and bonds?
Stocks are ownership; bonds are loans to a company or government.
What is the difference between a “need” and a “want”?
A need is essential for living; a want is something nice but not necessary.
What happens if you only pay the minimum amount due on a credit card balance?
You pay more interest and it takes longer to pay off debt.
What’s the first step to creating a budget?
Tracking your spending/income
What are progressive taxes?
Taxes that increase in rate as income increases.
What does the term “diversification” mean in investing?
What is spreading your money across different investments to reduce risk?