Basic Finance
A plan for managing your money by outlining expected income and expenses.
What is a budget?
A type of bank account used for everyday transactions.
What is a checking account?
Putting money into something with the expectation of earning a profit.
What is an investment?
The value of all assets minus liabilities. Basically, how much a person has all added up.
What is net worth?
Perhaps the most important thing you can do for your credit. It must be done before the due date to build a positive credit history.
What is pay your bill on time?
Money set aside for future use instead of spending it immediately.
What is savings?
A type of bank account where you can deposit money and earn interest.
What is a savings account?
Shares of ownership in a company.
What are stocks?
Money saved for unexpected expenses.
What is an emergency fund?
An important thing to do is utilize your credit card less than this amount. Or, ideally, less than this amount. [Give 2 amounts]
What is 30% or 10%
Money spent on goods and services.
What is an expense?
A card that withdraws money directly from your checking account.
What is a debit card?
Money earned from lending or saving money.
What is interest?
Money borrowed that must be repaid, often with interest.
What is a loan?
Doing this will help you establish credit history as soon as possible.
What is getting a credit card at 18?
Money received, typically from jobs or allowances.
What is income (salary, wage, earnings)?
A card that allows you to borrow money up to a certain limit for purchases or cash advances.
What is a credit card?
Loans made to a company or government, paid back with interest.
What are bonds?
A number representing how trustworthy you are with other peoples' money, especially over a period of time.
What is a credit score?
The maximum amount you can charge on a credit card.
What is a credit limit?
Money that you owe to someone else.
What is debt?
A machine that allows you to perform basic banking transactions without the help of a bank teller.
What is an ATM?
Spreading investments across different types of assets to reduce risk.
What is diversification?
A loan specifically for buying a home.
What is a mortgage?
A person who agrees to pay a debt if the original borrower fails to do so, often helping to build credit.
What is a co-signer/co-signatory?