Financial Literacy 1
A financial institution that accepts deposits from the public.
A Bank
What are the benefits of financial literacy?
Less debt, higher net worth, less financial struggle, improved household finances
An objective that a person sets affects how they save and spend money. Objectives can be short-term (e.g., buying a computer) or long-term (e.g., saving up for college/university).
Financial Goal or Savings Goal
Lauren pays for her book at the bookstore. If she uses a card that can only be used at a specific store, what kind of card is it?
A gift card
A document that orders a bank to pay a specific amount from the issuer's account to the person or organization named.
A check
A thing that is borrowed, especially a sum of money that is expected to be paid back in interest.
An agreement between a buyer and seller to exchange goods or services (including for money).
What are the two taxes FICA takes out on paychecks?
(Hint: You can start benefitting from both of these when you turn 65).
Social Security and Medicare
Bolin pays for a soda at the convenience store with cash. The soda costs $2.50. What is the total cost of the soda, if there is 7% sales tax charged?
$2.50 x .07 = 0.18
$2.50+0.18 = 2.68
The total cost of the soda is $2.68.
Name one of the two budgeting models we learned in class this year.
50/30/20 Rule and Pay Yourself First
A card issued by the bank that allows the holder to pay directly from a checking account when making a purchase.
Debit Card
Name 2 ways to improve your financial literacy.
Start budgeting, read about finances, take a personal finance class, set financial goals
Aran really wants the new PS5, which costs $500. Aran has $200.00 in his Bank of Walsh. However, he just received a credit card with a $1000 limit. Should Aran use his credit card to buy a PS5? Why or why not?
NO! Aran should not use his credit card because he does not have enough money in his checking account to pay off his credit card bill. He will end up paying interest on the outstanding balance owing on his credit card.
Name 3 things that you can do with your money.
Spend, Save, Invest, Donate, loan to friends/family
A realistic budget is where your expenses are not more than your income and it allows you to save money for future use? True or False
True
I have enough money to pay the balance of my credit card, but I just pay the minimum monthly payment. Is that the best financial decision? What will the credit card charge you if you don't pay your balance off monthly?
Interest.
Paying the minimum amount is not the best decision. A person is charged interest when their credit card balance is not at 0 by the end of the month.
List 3 taxes that are taken out of paychecks in Ohio?
Federal Income Tax
State Income Tax
Local Income Tax
Social Security
Medicare
Name 2 banks in Lebanon.
LCNB, 5/3 Bank, US Bank, 1st National Bank, Peoples Bank, and Huntington Bank
If you make $500 each week and there are 4 weeks in the month and your expenses are $1300 each month. How much does this leave you for additional spending or to put into savings?
$500 X 4 = $2000
$2000 - $1300 = $700
I have $700 remaining for additional spending or to put into savings.
1What term is used for the money that we receive in exchange for work.
Income
List the definition of a want.
A want is an item or service that is desired, but is not necessary to survive.
Suppose you have $100 dollars in a savings account earning 2% simple interest a year. After 5 years, how much money would your balance be?
$100x.02x5=$110
What should your credit card balance be by the end of the month?
It should be $0.00 by the end of the month.
What do you need to consider when making a budget? (hint - there are 3 points)
Needs, Wants, and Savings
Name the tax collected from home owners yearly in the United States.
Property tax