Banking
Primary difference between uses of a checkings and savings account
Checkings - Everyday purchases bills etc.
Savings - Keep money here for security and big purchases, also gain interest on this money
What is one benefit of having a savings account?
Interest on saved money and added security
Role of the EPA
Regulates businesses in relation to the enviroment
What is social security
When you are 62 you receive payments from of the government
A student can claim unemployment
False
How is money in your savings account "security?"
A emergency fund will protect you from sudden emergencies in life
Define Pension
Role of IRS
Primarily tax collection
Define "Mortgage"
Payments with interest towards owning a house (typically)
List three long-term goals
Varied answers
What percent of the total cost of a house do people typically put down for a mortgage?
10-20%
What percent of your income should you attempt to save per month?
What typically happens before the government creates a new economic agency
Decline in the economy
Define "Principal"
The sum deposited in the bank
What is a "First Time Homeowner Loan?"
If the buyer wants they only have to put down 3% for their first house
This historical event caused the "Great Depression"
What is a 401k
A retirement plan were your employer typically matches your contribution into a investment portfolio
What is the main functions of the FDIC
To regulate all banks in the US
What is a "work credit"
Which budgeting rule did we go over in class?
60 Needs
30 Savings
10 Wants
Explain the difference between a bank and credit union
Banks
-For profit businesses
-More services
Credit Union
-Non-profit
-Less ervices
What is a IRA plan
A retirement investment plan which you typically open at the bank. No employer matches and pre-tax benefits
- Set economic policy federal
- Set certain interest rates
- Collects data that leads to indicator of the markets health
Define "Compounding Interest"
Interest being earned on top of past interest and the principal
These sneaky type of loans were responsible for the 2008 real estate market crash
Ninja loans