INVESTING
What is the S&P 500?
What is the range for an excellent credit score?
750-850
What does APR mean?
Annual percentage rate
A payday loan is an example of what type of loan?
Single payment
What does your liability coverage on your auto insurance cover?
Any damage to other people or their property.
What is the difference between saving and investing?
Saving is just putting money in your bank account that may have a very low interest rate. Investing is deliberating putting your money into funds/stocks/bonds that will grow your money at a higher rate.
What are the 3 credit reporting agencies?
Experian, TransUnion, Equifax
If you pay a credit card bill late, what 3 things will happen?
1. Penalty APR
2. Fee
3. On credit report for 7 years
What is an advantage of buying a car over leasing a car?
You own the car so when you trade it in, you will get the value it has. With leasing, you have no value accumulated.
What does comprehensive auto insurance cover?
Damage to your vehicle that is not the result of a collision (hail damage, hitting a deer, etc)
Which is the safest investment?
Bonds
Name something that will NOT be found on your credit report.
Medical history, criminal background, race, religion
Pay in full and pay on time.
What is an amortization table?
A table that shows how much of every loan payment goes to principal and how much goes to interest.
Why does homeowner's insurance cost more than renter's insurance?
Homeowner's insurance covers your possessions, but also your house, yard, other buildings, etc. Renter's insurance only covers your possessions.
You bought 15 shares of Google stock for $155/share. One year later, you sold the stock for $210/share. What was your profit?
15 x 155 = $2325
15 x 210 = $3150
Profit = 3150 - 2325 = $825
Bankruptcies and collections can be found in what part of a credit report?
Public records
Name 3 different types of APRs.
APR for purchases, balance transfer APR, cash advance APR, introductory APR, penalty APR
Why would someone get a 20-year mortgage instead of a 30-year mortgage?
The shorter the loan, the less interest you will pay overall.
How do insurance companies determine what your premium should be?
They use statistics to evaluate the risk of various events and then find the probability that you will need to file a claim.
What is the difference between a stock and a mutual fund?
A stock represents only one company so your money will fluctuate with how that company is doing. A mutual fund is a collection of several companies so your money will tend to fluctuate less.
On a credit report, there is a section called "inquiries". What does this mean?
Inquiries are when someone (or a business) runs your credit report to see how you handle money.
What is a Schumer box and where do you find one?
It is a summary of all of the interest rates and policies for a specific credit card. They can be found in a credit card offer.
What are 2 ways to reduce the interest you have to pay on a loan?
1. Make a down payment.
2. Get a shorter term.
3. Shop around for the best interest rate.
How do insurance companies afford to cover the costs of expensive claims?
They use risk pooling.