Saving and Budgeting
The money you earn from a job or business.
What is income?
Borrowed money that must be paid back, often with interest.
What is debt?
Buying ownership in a company.
What is a stock?
A safe place to store money that you can easily access.
What is a checking account?
Money set aside specifically for when you stop working.
What is retirement savings?
A plan for how you will spend and save your money.
What is budget?
A three-digit number that represents your creditworthiness.
What is a credit score?
A loan you give to a company or government in exchange for interest payments.
What is a bond?
An account that typically earns interest on your deposits.
What is a savings account?
A retirement account often offered by employers with possible matching contributions.
What is a 401(k)?
The general rule that suggests saving at least this many months of living expenses in an emergency fund.
What is 3 to 6 months?
Paying off the highest interest debt first is known as this repayment strategy.
What is the avalanche method?
This financial concept allows you to earn returns on both your original money and past earnings.
What is compound interest?
This document summarizes all transactions in your account over a certain period.
What is a bank statement?
This type of insurance helps cover costs of medical care.
What is health insurance?
Money set aside to cover unexpected expenses like car repairs or medical bills.
What is an emergency fund?
The cost of borrowing money, usually expressed as a percentage.
What is interest?
Earnings generated from an investment over time.
What is a return?
This federal agency insures bank deposits up to $250,000 per depositor.
What is the FDIC?
The age at which individuals can typically begin receiving full Social Security retirement benefits (varies by birth year but generally around this age).
What is 67 years old?
This budgeting rule suggests 50% for needs, 30% for wants, and 20% for savings.
What is the 50/30/20 rule?
This type of loan usually has lower interest rates and is backed by collateral like a car or house.
What is a secured loan?
Spreading investments across different assets to reduce risk is called this.
What is diversification?
A fee charged when you spend more money than is available in your account.
What is an overdraft fee?
A legal document that outlines how your assets will be distributed after your death.
What is a will?