Money Basics
The type of currency you can physically hold, like bills and coins.
What is Cash?
A plan for how you will spend and save your money.
What is a budget?
A plastic card that allows you to borrow money for purchases.
What is a credit card?
A savings account that earns interest and is insured by the government.
What is a bank savings account?
The form your employer gives you that shows your yearly earnings.
What is a W-2?
The amount of money you earn before taxes are taken out.
What is gross income?
A regular monthly payment for housing.
What is rent?
Your history of borrowing and repaying money is shown in this number.
What is a credit score?
Buying a small piece of a company makes you an owner of one of these.
What is a stock?
The amount taken out of your paycheck to support retirees, disabled workers, and survivors.
What is Social Security?
The amount of money left after all expenses are paid.
What is net income?
These expenses stay the same every month (like your phone bill).
What are fixed expenses?
Money you borrow that must be paid back with interest.
What is a loan?
A type of investment made up of many stocks bundled together.
What is a mutual fund?
The tax you pay on goods and services at the checkout.
What is sales tax?
A place where you store your money for safety and interest.
What is a bank?
A recommended percentage of your income to save (commonly suggested as a starting point).
What is 20%?
The fee you pay for borrowing money.
What is interest?
The idea that money grows faster over time because you earn interest on interest.
The idea that money grows faster over time because you earn interest on interest.
A document you submit every year to the government to report income and claim refunds.
What is a tax return?
Money you set aside for future use.
What is savings?
The financial rule that says you should save for emergencies worth 3–6 months of expenses.
What is an emergency fund?
The maximum amount of money a lender allows you to borrow on a credit card.
What is a credit limit?
When you spread your money across many investments to reduce risk.
What is diversification?
The tax placed on the money you earn through your job.
What is income tax?