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Define a hard skill and give examples
a technical or physical skill; easily quantifiable. Athletic ability, coding, typing skills, proficiency in a foreign language
The rule of 72 is
a formula used to estimate how long it will take your money to double in an investment; #years= 72/interest rate OR 72/#years=interest rate
Required deductions include
federal tax, state tax, local tax, social security, medicare, Unemployment Compensation (UC)
A credit history report includes
1. Personal Info (name, address, SS#).
2.Public Records like bankruptcies
3. Collections for NO/late payments
4. Trade lines: info on credit cards, car loans, mortgages, student loans, retail accounts
5. Inquiries
Define bankruptcy and what is not discharged
legal proceeding initiated when a person or business in unable to repay outstanding debts or obligations- discharges certain liabilities; student loans, alimony, child support, certain taxes
Define soft skills and give examples
nontechnical and nonphysical abilities; people skills. Teamwork, leadership, communication, time management
Employee benefits are (examples)
health/medical insurance, dental, vision, 401k, pension plan
Federal tax $ funds
health programs, armed forces (military), national debt (interest), unemployment & labor, veteran's benefits, food & agriculture, education (Pell grants)
These three companies determine your credit score
Equifax, TransUnion, Experian
savings accounts, checking accounts, CDs, MMAs
stocks, bonds, mutual funds, life insurance policies, valuables, safety deposit box
A resume includes
hard/soft skills, work or volunteer experience, schooling, awards/achievements, extracurricular activities; Summary Statement and NO references
Types of pay without work include
vacation, sick days, holiday, personal days; NOT on the list are maternity or paternity leave
FICA stands for...and includes these taxes
Federal Insurance Contributions Act; social security tax & medicare tax
Define FICO and explain credit score
Fair Isaac Corporation; a 3 digit numeric number that ranges from 300-850; Your financial score card; dynamic as it can change each time you inquire about it. Number based off info in your credit history and credit reports
Floating a check is
writing a check and planning to make a deposit later to cover it before the check is processed
Examples of unearned income include
dividend & capital gains, alimony, pension, child support, disability, interest, rent, royalties, social security, unemployment compensation, workers compensation
Perks include
parking space, child care facilities, fitness center, office with a view
The net worth formula is
assets - liabilities = net worth
assets: any resource owned or controlled by someone
liability: something a person or company owes; usually a sum of $ (loans)
Simple interest is____; define compound interest
simple interest: I=PRT
interest earned on both the principal amount and any interest already earned
can calculate this using the simple interest formula annually, and then using the new value as your starting value for the next year, using the formula again
low: cash, bonds, checking accounts, savings accounts, CDs, annuities, treasury bills
medium: personal residence, mutual fund, index fund, 401K, pension plan, 403b
high: stocks, bitcoin, rental properties, flipping homes, precious gems, collectibles, starting a business, land deals, REITs
Examples of earned income include
HOURLY wages, salary, tips, commission, bonuses
before vs. after deductions
an expense that changes from one period to the next vs. an expense that stays the same over time (usually month to month)
Explain w-2, w-4, and 1040 forms
reports your taxable/gross income and amount of taxes paid for the calendar year; form given to you by employer in January
a form you must fill out when you start a job; drives how much federal tax is withheld from your paycheck
(hint w-4= beFOUR you get a job)
federal tax return form; determines AGI (adjusted gross income), and taxable income; determines tax liability
** reconciles the amount you got withheld vs the amount you owe. Due date is April 15th. Contains term standard deduction
Define ROI and formula
return on investment
(new value-original value)/original value x 100%