Category: Budgeting Basics
This is the term for the difference between your income and your expenses each month.
What is "disposable income"?
This is the ownership stake you hold in a company when you buy its stock.
What is a "share" or "stock"
This score reflects your creditworthiness and is used by lenders to determine loan eligibility.
What is a "credit score"
This government-sponsored retirement account allows workers to save money with tax advantages.
What is a "401(k)"?
This tax document shows how much an employer has paid an employee and how much tax was withheld.
What is a "W-2"
This is a common budgeting method where you divide your expenses into needs, wants, and savings.
What is the "50/30/20 rule"
These are low-risk investment options that pay interest over a fixed term, often used by conservative investors.
What are "bonds"
This is the interest rate charged on loans or credit cards, expressed as an annual percentage rate.
What is "APR" (Annual Percentage Rate)?
This retirement account is typically used by self-employed individuals and small business owners, offering tax-deferred savings
What is a "SEP IRA"?
This is a tax-deferred savings account used for medical expenses.
What is an "HSA" (Health Savings Account)?
This term refers to the total amount of money you owe, including credit cards, loans, and mortgages.
What is "debt"
This term refers to spreading your investments across various assets to reduce risk.
What is diversification
This term refers to using borrowed money to finance a purchase, with the expectation that you'll repay it later.
What is "credit"?
This is the minimum age at which you can begin withdrawing from your retirement accounts without penalty.
What is "59½"?
This type of account allows you to save for college expenses while enjoying tax benefits
What is a "529 Plan"?
These are essential expenses like housing, utilities, and groceries that you must pay each month.
What are "fixed expenses"
This is the type of retirement account where your contributions are taxed when you withdraw, not when you deposit.
What is a "Traditional IRA"?
This financial product allows you to borrow money, with a limit based on your creditworthiness.
What is a "credit card"?
This is the formula used to estimate how much you need to save for retirement based on your current lifestyle and future goals.
What is the "4% rule"
This is a type of tax credit that can reduce the amount of taxes you owe, often related to dependents or certain life circumstances
What is a "child tax credit"?
his financial tool helps you plan and track your monthly spending to ensure you live within your means.
What is a "budget"?
This long-term investment strategy involves buying and holding a diverse mix of investments, often including stocks, bonds, and real estate.
What is "buy and hold"?
This is the act of paying off debt by making larger payments than required or consolidating debts into a lower-interest loan.
What is "debt refinancing" or "debt consolidation"?
This government-provided retirement benefit offers monthly payments to retirees, with eligibility based on work history.
What is "Social Security"?
This is the process of setting aside money in an account to cover future emergencies or unexpected expenses.
What is "emergency savings"?