Checking & Savings Accounts
A type of account used for everyday transactions, typically offering little to no interest.
What is a Checking Account?
The formula for calculating simple interest is: Interest = Principal × Rate × Time. If you deposit $1,000 at 5% interest for 3 years, how much interest will you earn?
What is $150?
A loan used to purchase a home, often repaid over 15 to 30 years, is called what?
What is a Mortgage?
Renting a home has this advantage, as the landlord handles property maintenance.
What is Maintenance?
This is the amount you pay each month to maintain your health insurance coverage.
What is the Premium?
What is the Premium?
A savings account typically has higher interest rates than a checking account but may limit what?
What is the number of withdrawals?
In compound interest, interest is earned on both the principal and any interest that has already been earned. This is called what?
What is Compound Interest?
This type of mortgage has an interest rate that remains the same over the life of the loan.
What is a Fixed-Rate Mortgage?
Buying a home offers the advantage of building this over time, which renting does not
What is Equity?
This is the amount you must pay out of pocket before your health insurance begins covering medical expenses.
What is the Deductible?
This type of account is designed to store money and earn interest over time.
What is a Savings Account?
This is the term for how often interest is added to the principal in a compound interest account.
What is the compounding frequency?
This type of mortgage allows the interest rate to change after an initial period.
What is an Adjustable-Rate Mortgage (ARM)?
One disadvantage of renting is the potential for this, which can make monthly payments less predictable
What is Rent Increases?
This term refers to the amount you pay for medical services after meeting your deductible.
What is a Co-Pay or Co-Insurance?
Checking accounts typically have fees for things like overdrafts, but they usually don't require a high minimum balance to avoid monthly fees
What is Minimum Balance?
In compound interest, if you invest $2,000 at 6% interest compounded quarterly for 2 years, how much will the investment be worth?
What is $2,528.16?
An initial payment made when purchasing a home is called what?
What is a Down Payment?
When buying a home, you will likely incur this upfront cost, along with a mortgage.
What is Closing Costs?
If you pay a monthly premium but still pay a percentage of the cost for medical services after meeting the deductible, this is called what?
What is Co-Insurance?
This type of account is primarily used for long-term savings and generally has a higher interest rate than a typical savings account, but it restricts access to funds without penalties.
What is a Certificate of Deposit (CD)?
This formula is used to calculate compound interest: A = P(1 + r/n)^(nt). If you invest $3,000 at 7% interest, compounded annually for 6 years, how much will the investment grow to?
What is $4,504.89?
A car loan is a type of loan to buy a vehicle, typically repaid over how many years?
What is 3 to 7 years?
Renting typically offers more of this compared to buying, as it allows you to move without long-term commitment.
What is Flexibility?
This is the amount of money you must pay out-of-pocket before your insurance company begins covering all expenses for the year, after the deductible is met.
What is the Out-of-Pocket Maximum?