Intro to PF
When it comes to managing money, success is measured by this.
What is the 80/20 rule?
The five steps to financial success.
What are the Five Foundations?
The act of matching your bank statement with your checkbook.
What is reconciling?
An item that I bought without previous planning or consideration of the long-term effects.
What is an impulse purchase?
All of the decisions and activities of an individual or family regarding their money, including spending, saving, budgeting, etc.
What is Personal Finance?
Interest paid on interest previously earned.
What is Compound Interest?
A series of envelopes that are divided into categories (food, entertainment, gas, etc.,) are used to store cash for planned monthly expenses.
What is an envelope system?
A summary that shows total income and spending for a given time period.
What is a cash flow statement?
A fee paid by a borrower to the lender for the use of borrowed money.
What is Interest?
The persistent increase in the cost of goods and services or the persistent decline in the purchasing power of money.
What is inflation?
A copy of each check you write.
What is a carbon check?
A written cash flow plan.
What is a budget?
A debt evidence by a "note," which specifies the principal amount, interest rate, and date of repayment (example: house mortgage)
What is a Loan?
A savings account that is set aside to be sued only for emergency expenses.
What is an emergency fund?
Occurs when money is withdrawn from a bank account and the available balance goes below zero.
What is an overdraft?
A cash flow plan that assigns an expense to every dollar of your income, wherein the total income minus the total expenses equals zero.
The knowledge and skillset necessary to be an informed consumer and manage finance correctly.
What is Financial Literacy?
Saving money over time for a large purchase.
What is a sinking fund?