Banking Basics
The place where people keep their money safe and can withdraw it when needed.
A Bank
A plastic card that lets you buy things now and pay for them later
Credit Card
A plan for how you will spend your money each month
Budget
When you put money into something hoping it will grow and make more money over time
Investing
A written promise that a company will fix or replace a product if it breaks
Warranty
The plastic card connected to your bank account that lets you buy things and get cash from ATMs.
A debit card
Money that you borrow and promise to pay back later
Debt or Loan
Money you put aside and don't spend right away.
Savings
A special account where you save money for when you stop working and retire
Retirement Account
Protection you buy in case something bad happens to your car, house, or health.
Insurance
What you need to show the bank to prove who you are when opening an account
Identification (ID card)
The extra money you pay when you borrow money, calculated as a percentage
Interest
Things you must pay for to survive, like food, housing, and clothing.
Needs
Small pieces of ownership in a company that you can buy and sell.
Stocks
Protection you buy in case something bad happens to your car, house, or health
Insurance
The extra money a bank pays you for keeping your money in a savings account
Interest
What happens when you don't pay back money you borrowed on time?
You have to pay late fees or penalties
Things you would like to have but don't absolutely need, like entertainment and dining out
Wants
The chance that you might lose money when you invest.
Risk
Tricks that dishonest people use to steal your money or personal information.
Scams or Fraud
The record that shows all the money going in and out of your bank account
Bank Statement
Your reputation for paying back money you borrow, which affects future loans
Credit / Credit Score/ Credit History
Money saved for unexpected problems, like a broken car or medical bill
Emergency Fund
When you don't put all your money in one investment but spread it around different ones
Diversification
The sum of all expenses incurred from an object's purchase to its eventual disposal, not just the initial price tag
TCO: Total Cost of Ownership