Types of Credit
A physical piece of paper that can be used in exchange for goods, debt, or services.
Cash
An account at a bank or credit union that holds and saves your money for you
Savings account
A financial goal that you set for yourself and hope to achieve within a reasonable time frame
Saving goal
Tom is saving up for a down payment on a pre-owned car, the cost will roughly be $2,000. which kind of account would be best for her to open?
What is a savings account?
What is the difference between a debit and a credit card?
A debit card only uses the money from the person's bank account.
A credit card uses the money that a person borrowed from the place where they received the card.
A card in which you can only spend the balance available in the account.
Debit card.
An account that allows you to deposit and withdraw money that can also be used on a daily basis
Checking account
A financial goal that can be achieved within a few weeks to months
Short term goal
Recently, Debra received $100 for her birthday, and instead of carrying it around, she decided to open an account just for random spending. Which account should she open?
What is a checking account?
What is the difference between direct deposit and an overdraft?
Direct deposit: When money is automatically put into a bank account
Overdraft: A bank term that means you are charged for money that you didn't have
A card that allows you to borrow money from the bank
Credit card
A nonprofit institution owned by its members.
Credit union
A financial goal that can be achieved within a few months to years
Mid term goal
Jay is at Walmart, he is offered a 20% discount if he signs up for what type of card?
What is a Walmart credit card?
What is the difference between a deposit and a withdrawal?
Deposit Money placed in a bank account
Withdrawal: Taking money out of an account
A card that you have pre-loaded with money.
Prepaid Debit Card.
A person that dosnt have a bank account
unbanked
A financial goal that can be achieved within a few years
Long term goals
Ruth had been in an accident that left her injured. Where can she go to access her banking information without leaving her house?
What is an online bank
What is the difference between a checking and saving account?
What is one is an account that is specifically made for spending the money you put in the account the other is for saving money
Funds that one saves in case of an emergency
Emergency funds
A sum of money you get at the end of the week when employed
Paycheck
Putting money into assets like bonds or stock
Investing
Terry Smith just got a job and wants to find a non-profit financial institution with low bank fees. Which type of Institution is Terry going to open?
What is a Credit Union
What is the difference between a Auto Loan and a Home Equity Loan?
Auto Loans are secured loans where the vehicle itself is used as collateral.
Home Equity Loans allow homeowners to borrow against the equity in their homes. The loan amount is based on the difference between the home’s current market value and the homeowner’s mortgage balance due.