Decision Making
Fundamental beliefs that shape and influence financial behaviors and decisions.
Financial Values
A financial institution licensed to receive and store deposits, and provide loans and other financial services to individuals and organizations.
Bank
An employee-sponsored qualified retirement plan that allows both employees and employers to contribute money on a tax-deferred basis.
401(k)
The value of the next best alternative that is forgone when a decision is made to choose one option over another.
Opportunity Cost
Individuals or entities that prioritize minimizing potential losses over the possibility of achieving higher returns.
Risk Averse
The management of an individual's financial decisions, including budgeting, saving, spending, and planning for the future.
Personal Finance
An individual or entity that lends money or extends credit to another.
Creditor
A tax imposed on the income generated by an individual or business.
Income Tax
The percentage gain or loss on an investment over a specified period without adjusting for inflation.
Nominal Return
The income generated by an investment, typically expressed as a percentage of the investment's cost or current value.
Yield
Someone who prioritizes accumulating money, often seeking security and stability through regular saving habits.
Saver
A sum of money securely stored at a bank.
Deposit
An exemption that reduces the income tax an employer withholds from an employee’s earnings.
Withholding Allowance
The increase in the general level of prices in an economy.
Inflation
The gain or loss generated on an investment, compared to the amount of money invested, and is normally expressed as a percentage.
Return on Investment (ROI)
A person who enjoys using their money to purchase products and experiences without much hesitation, and with less concern for saving.
Spender
A sum of money borrowed with the expectation to be paid back with interest over a specified period of time.
Loan
An IRS-approved retirement plan that offers various benefits and tax incentives to employees.
Qualified Retirement Plan
The essential expenses that are necessary for maintaining one's basic standard of living.
Financial Needs
The risk of not being able to sell an investment quickly enough to prevent or minimize a loss.
Liquidity Risk
The distinct patterns or tendencies in how individuals perceive, interact with, and manage their finances.
Money Personalities
Occurs when too many people try to withdraw their money from a bank at the same time, fearing the bank won’t be able to meet its financial obligations.
Bank Run
The U.S. federal agency responsible for enforcing tax law and collecting taxes on behalf of the U.S. government.
Internal Revenue Service
The process where the value of an investment grows exponentially over time due to the earnings on the investment itself also growing.
Compounding
The profit earned from the sale of an asset.
Capital Gain