Savings accounts
True or False: saving is growing your money for short and long-term use
True
False
What does FDIC stand for?
Federal Deposit Insurance Corporation
What is one benefit of using a credit card for purchases?
-You don't have to carry cash or write checks
-you can use the card to pay for unexpected emergency expenses
-if occasionally you don’t have cash available for necessities
What does credit score measure?
The likelihood that a borrower will be severely past due on at least one account in the next 18 months.
What is liquidity?
How easily you can get money from your account
What is APY?
Annual Percentage Yield- the interest rate at which your interest is earned
What is the Fed?
Federal reserve system- central bank of the United States
What happens if you make the minimum payment every month?
You give yourself temporary relief but will end up paying more in interest charges later on
What is payment history?
How fast and how much money you tend to spend.
Yes, because of inflation
Which type of interest is calculated based on the entire account balance, including prior interest paid?
Compounding interest
What is the primary job of the Federal Reserve?
Control inflation while avoiding a recession.
What are the 3 types of credit cards?
general purpose, store cards, charge cards
What is the scale for minimum to maximum possible credit score?
300-850
Which type of savings account takes 20 years to mature?
if your interest rate is 4% how many years will it take for your money to double?
18 years
What does the FDIC do?
Promotes public confidence in the U.S. financial system by insuring deposits in banks. Protects you against the loss of your insured deposits if an FDIC-insured bank or savings association fails.
How can you avoid paying interest on your credit card?
Pay the full balance each billing cycle. Don’t spend more than you are allowed each month
payment history, amount owed, length of credit history, new credit, types of credit
Which type of savings account usually has the highest interest rates?
Money Market
If your money doubles every 24 years, what is your interest rate?
3%
Will you lose money if your FDIC insured bank fails?
No, the FDIC protects depositors' funds in the unlikely event of the financial failure of their bank or savings institution.
What is a credit deadbeat?
Someone who pays off their balances every month, using the lenders' money but paying no interest on it, because credit card companies don’t make any money off them.
A measure of how much you owe on all your revolving accounts, such as credit cards, compared with your total available credit — expressed as a percentage.