RISKY BUSINESS
This type of financial product helps protect you from unexpected financial losses.
What is insurance?
Putting money aside for future use is called this.
What is saving?
The total amount of money you borrow is known as this.
What is principal?
This is a plan for how you will spend your money.
What is a budget?
The money you earn from your job before taxes and deductions is called this.
What is gross income?
The is the amount you have to pay before your insurance company will pay.
What is a deductible?
This is the percentage of your money you earn over time on your savings or investments.
What is interest (or rate of return)?
This three-digit number reflects your creditworthiness.
What is a credit score?
The concept of putting your money into savings before you pay your other bills.
What is "pay yourself first?"
This form is used by employers to report your annual earnings and withholdings to the IRS.
What is a W-2 form?
Buying a mix of different types of investments to reduce risk is called this.
What is diversification?
Buying shares of ownership in a company makes you a holder of this.
What is stock?
This is the cost of borrowing money, expressed as a yearly percentage.
What is the Annual Percentage Rate (APR)?
The rule where your net income is divided between needs, wants, and savings.
What is the 50/30/20 Rule?
You need to subtract this from a college's cost of attendance in order to find the net price.
What are grants and scholarships?
When a "pool" of people pay monthly premiums, regardless of whether they file any claims or not.
What is risk pooling?
This term describes the practice of investing a fixed amount of money at regular intervals, regardless of the investment's price.
What is dollar-cost averaging?
Failing to repay your debts on time can lead to a negative impact on this.
What is your credit history (or credit report)?
The formula for calculating net income is gross income minus these.
What are deductions?
You need to submit this in order to determine eligibility for federal student aid.
What is the FAFSA?
You crashed into your neighbor's fence when backing out of the driveway. This type of auto insurance coverage will pay for the damages.
What is liability coverage?
The power of this occurs when your earnings also start earning returns.
What is compound interest?
A type of loan that has collateral (such as a car or a house) that can be repossessed if not paid, is called this.
What is a secured loan?
This budgeting method involves giving every dollar a job.
What is the zero-based budget?
This type of tax is deducted from most employees' paychecks to fund Social Security and Medicare.
What is FICA tax?