Budgeting
Explain 50-30-20 Budgeting method
Spend 50% of your net pay on needs, 30% on wants, 20% on savings.
The process of writing on the back of a check before the bank will give you the money.
Endorsing
This is the number rating representing a person's ability to pay off debt.
What is Credit Score?
Amount of money you pay for an insurance policy
Premium
List the following investment types in order from lowest to highest risk:
Bonds, Savings Account, Stocks
What is: Savings Account, Bonds, Stocks?
Money put away into a bank to use for later or for an emergency
Savings
What is the process called when you compare your records with the banks?
Bank Reconciliation
Explain what an APR of 20% means
This is the yearly cost of borrowing money. For instance, if you borrowed $1000, you would owe 20% of $1000 = $200 in interest payments PLUS the original amount borrowed.
An agreed upon amount, between you and your insurer, that you will pay before the insurance company pays anything.
Deductible
Having many different types of investments.
What is DIVERSIFICATION?
What does PYF stand for?
Pay Yourself First
This fee happens when you spend more than what is in your account.
Overdraft Fee
What are 2 of the factors that impact your credit score?
Examples:
Payment history
Amount owed (credit utilization)
Length of credit history
New Credit
Mix/Type (diversity) of credit
This insurance covers the damages to your car if a tree falls on it.
Comprehensive
This is a type of mutual fund that just MATCHES the market (like the S&P 500). It is ALREADY diversified.
What is an INDEX FUND?
What you earn in your paycheck before taxes
Gross Pay
Your bank sends you this monthly to show all of your debit and credits for the month.
What is the Bank Statement?
How do you make sure you never have to pay a finance charge?
Always pay before the grace period.
This covers the cost of the OTHER person's car if you are at fault in the accident.
Liability Insurance
This is an EMPLOYER Sponsored retirement plan based on the money YOU will also contribute.
If they offer a match, max out that amount!
What is a 401K?
A printed record of money put into and removed from a bank account
Bank Statement
FDIC stands for?
What is Federal Deposit Insurance Corporation?
Name TWO of the 3 major credit unions.
What is
TRANSUNION
EQUIFAX
EXPERIAN
A formal request from the customer to the insurance company asking for a payment based on the terms of the policy.
What is a claim?
This is the type of retirement account that YOU set up (not your job). It also allows for tax free growth since you've already paid taxes on the money you put in so that you won't pay taxes when you take it out again.