Definitions
Consumer Protection Laws
Income
Spending and Credit
Saving and Investing
100
A retirmement investment that allows an employee to put a percentage of earned wages into a tax-deferred investment account selected by the employer.
What is a 401(k)
100
Lenders must disclose the costs associated with getting credit.
What is Consumer Credit Protection Act (or Truth in Lending Act)
100
401(k), Health Savings Account, Health/Dependent Reimbursement Account
What are three examples of pre-tax employment benefits?
100
Character, capital, capacity, collateral, conditions, and high credit score
What factors make it more likely that a consumer will be able to get a loan at a bank?
100
The more compounding periods there are, the more interest the consumer earns.
What effect does the number of compounding periods have on an investment?
200
An expense that you can subtract from your adjusted gross income to figure your taxable income.
What is a tax deduction?
200
Ensures confidentiality of consumer credit information held by lenders and credit reporting agencies. It also outlines who can access a consumer credit report.
What is Fair Credit Reporting Act.
200
No income taxes on profit when you sell your house (up to $250,000) Interest paid on a mortgage loan is tax-deductible.
What are two tax benefits of home ownership?
200
In order to determine the riskiness of the consumer.
Why do lenders and insurance companies use credit reports to set interest rates and premiums?
200
It would not because of inflation.
Would $100 today buy the same amount of goods/services in 40 years?
300
The smallest amount you can pay and remain a borrower in good standing.
What is minimum payment?
300
Protects consumers from unfair and unlawful charges. Outlines consumer’s rights to address and dispute billing errors.
What is Fair Credit Billing Act.
300
When you file your tax return, you owe the IRS a tax payment.
How would you know you needed to increase your payroll withholding?
300
Truth in Lending Act
What is another noame for the OCnsumer Credit Protection Act?
300
7.2 years
How long would it take an investment to double if it were earning 10% interest?
400
Before you pay bills or buy anything, you should put something into your savings account, even a small amount.
What is Pay Yourself First.
400
Ensures that all consumers are given an equal chance to obtain credit. It is unlawful for creditors to discriminate against an applicant based on age, race, religion, national origin n, marital status, or gender.
What is Equal Credit Opportunity Act
400
Wages, dividends, and transfer payments.
What are three examples of income?
400
It is more risky to the bank to lend to a consumer for 30 years vs. 15 years. The term of the loan is longer; therefore a consumer will pay more interest.
Why would a borrower pay more interest for a 30 year fixed loan than a 15 year fixed loan?
400
Level 4 Investments
What is speculative stocks, junk bonds, collectibles, options, futures
500
A partial refund of the price of a product.
What are rebates?
500
The most common type of bankruptcy. Also know as liquidation bankruptcy. All assets are sold and the money is distributed to creditors.
What is Chapter 7 Bankruptcy.
500
It determines the amount withheld for federal income tax.
What is W-4?
500
To pay off the card faster and to reduce the amount of interest paid.
Why should you pay more than the minimum payment on your credit card?
500
Level 1 Financial Security
What is savings bonds, CDs, Annuities, Bank Accounts
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