Elementary School
Money you keep instead of spending right away.
Saving
Money you can earn from a job before anything is taken out.
Gross pay
A plan that tracks income and expenses.
A budget
A government program that provides income during retirement.
Social Security
The stage of life when most people stop working full time and live off savings or benefits.
Retirement
This is something you cannot live without, it's not a want its a...
Need
Money taken out of your paycheck for things like taxes.
Deductions
Money set aside for unexpected expenses.
An emergency fund
An account designed specifically for saving for retirement.
An IRA
When the cost of goods and services rises over time.
Inflation
Money you earn for doing chores or small jobs.
An allowance
A bank account used for everyday spending and debit cards.
Checking account.
A long-term loan commonly used to purchase a home.
A mortgage
The age when penalty-free withdrawals from most retirement accounts begin.
Age 59 1/2
Having different types of investments to reduce risk.
Diversification
When you give money in exchange for something you want or need.
Spending
The cost of borrowing money, shown as a percentage.
Interest
Contributing part of your paycheck to save for the future through your employer.
A 401(k)
The challenge of making savings last throughout retirement.
Longevity risk
Earning interest on both your original money and previous interest.
Compound interest
This is what you do when you trade money for something you want, like a toy or a treat.
Making a financial (money) decision
A number lenders use to help decide if you are approved for a loan.
Credit score
The financial risk of relying on high-interest debt over a long period of time.
Increased total cost due to compound interest on debt.
Required withdrawals the IRS mandates from certain retirement accounts.
Required minimum distributions (RMDs)
When emotions, not logic, influence financial decisions—often leading to poor outcomes.