Budgeting
This term describes the amount of money left in your paycheck after federal taxes, state taxes, and other deductions have been taken out.
What is Net Pay?
This type of insurance helps pay for doctor visits and medical bills.
What is health insurance?
This type of account is recommended to keep your emergency fund separate from everyday money.
What is a savings account?
This type of tax is added to most items you buy in a store.
What is a sales tax?
A 25-year-old has this distinct advantage over a 40-year-old investor, allowing their money to grow significantly more even if they invest the same dollar amount.
What is Time (or more time for compounding)?
This number is used by lenders to determine how much they charge you for interest on loans.
In the 50/30/20 budgeting rule, 30% of your income is designated for this specific category.
What are Wants?
Expenses that do not change from month to month (like rent, mortgage, or car payment).
What are fixed expenses?
This is what you file when you want the insurance company to pay for a loss.
What is a claim?
This small plastic card lets you spend your own money from your bank account.
What is a debit card?
This form shows how much money you made and how much tax was withheld during the year.
What is a W-2?
This strategy involves spreading your money across different types of investments (like domestic stocks, international bonds, and real estate) to reduce risk.
What is Diversification?
When you borrow money from a bank and promise to pay it back with interest, it’s called this.
What is a loan?
This is the core economic principle illustrated when you only have enough money for a sweater OR a video game, but not both
What is Scarcity?
Budgeting helps you avoid this financial trap where you owe more than you can pay back.
What is debt?
Generally, if you choose an insurance plan with a lower deductible, your monthly premium will do this.
What is Increase (go up)?
The fee that some banks charge if you spend more than what's in your account.
What is an overdraft fee?
This is the name for taxes taken out of your paycheck before you even see it.
What is withholding?
This type of interest is calculated on both the original amount you invested and the interest you have already earned.
What is Compound Interest?
Doing only this every month on your credit card bill ensures you stay in good standing but will result in the highest total interest cost.
What is making the minimum payment?
This economic force causes the price of goods to rise over time, effectively decreasing the purchasing power of your money.
What is inflation?
This type of expense changes from month to month, like dining out or gas.
What is a variable expense?
This type of insurance helps cover you if you get sued for accidentally hurting someone.
What is liability insurance?
This is money a bank will pay you for keeping your money with them.
What is interest?
You fill out this form when you start a new job to tell your employer how much tax to withhold from each paycheck.
What is a W-4?
Between stocks and bonds, this investment vehicle is considered riskier but offers the potential for higher returns over a long period.
What are Stocks?
This is the only payment strategy that guarantees you will pay $0 in interest on your credit card purchases.
What is paying the full balance (or paying in full) every month?
Name at least 2 mandatory deductions from a paycheck
Social security tax, federal and state income taxes, Medicare tax
A sudden car repair would be considered this type of expense (that you should be budgeting for)
What is an unexpected or emergency expense?
This is the amount you pay out of pocket before insurance kicks in.
What is a deductible?
Of the following three accounts—Checking, Certificate of Deposit (CD), or Money Market—this one generally offers the lowest liquidity (hardest to access cash immediately).
What is a Certificate of Deposit (CD)?
This system means people with higher incomes pay a higher percentage in taxes.
What is a progressive tax system?
This employer-sponsored retirement plan often includes a "match" contribution, which is essentially free money for your future.
What is a 401(k)?
Generally, the longer the time you take to pay back a loan, this happens to the total amount of interest you pay.
What is it increases?
This government agency collects federal taxes and enforces tax laws
What is the IRS (Internal Revenue Service)?
Name at least one optional deduction from your paycheck
Savings, union dues, health insurance
This is the name of the money you pay every month to have an insurance policy.
What is a premium?
The federal agency that protects your money in most U.S. banks up to $250,000.
What is the FDIC (Federal Deposit Insurance Corporation)?
Name two states that do not have a state income tax
Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, Wyoming
As an investor approaches retirement age (e.g., 65), they should typically shift their portfolio away from high-growth stocks toward this type of asset to ensure stability.
What are Bonds (or low-risk assets)?
This term represents the yearly cost of borrowing money, expressed as a percentage.
What is the Annual Percentage Rate? (or Interest Rate).
This 2024 viral TikTok song describes a woman searching for a partner who is "6'5, blue eyes," and works in this specific industry
What is Finance?