creating a savings plan
what is a savings plan?
A strategy for using money to reach important goals.
what is a savings account?
An account designed for accumulating money for future use.
What is principals?
The amount of money originally deposited.
What does inflation do?
Reduces the value of your savings.
what is future value?
The value of an amount of money invested with compound interest at the ending period.
What is a financial security?
The ability for an individual to meet essential needs with taking on more debt.
What is an annual parentage rate?
The rate of yearly earning from an account.
What is compound interest?
An amount calculated using principal plus the interest it earns.
What does inflation change?
The value of money each year.
what is a money market account?
A type of savings account that pays a higher interest rate then other savings accounts.
What does SMART goal stand for?
Specific, measurable, achievable, realistic and time related.
what is interest-bearing savings?
A type of demand deposit account that pays interest and allows for deposits and withdrawals.
What is the time value of money?
The idea that money decreases in value over time.
what does tax-exempt means?
It means free of certain taxes.
what is paying yourself?
Putting gifted money into a savings account
What is the first savings goal?
To make an emergency fund
What is an high-yield savings account?
An account that pays a higher interest rate than passbook and statement savings account.
what is simple interest?
The interest earned only on the principal.
what does tax-deferred means?
It means taxes on the principal is delayed until funds are withdrawn.
What is letting your saving grow?
Choosing a saving account that makes withdrawals difficult.
What is a payroll savings plan?
A program in which an employee offers automatic saving options.
what is a certificate of deposit?
A savings account that requires a deposit of a fixed amount of money for a fixed period of time.
what is the rule of 72?
what should you when selecting a savings plan?
You should compare and evaluate different types.
Putting most money in a savings account.