| A | B |
|---|
| Personal Financial Planning | Arranging to spend, save and invest money to live comfortably, have financial security, and achieve goals |
| Goals | The things you want to accomplish |
| Values | The beliefs and principles you consider important. Correct, and desirable. Different people value different things. |
| Opportunity Cost | Trade-off, is what is given up when making one choice instead of another |
| Liquidity | Is the ability to easily convert financial assets into cash without loss in value |
| service | Task that a person or a machine performs for you |
| Good | A physical item that is produced item that is produced and can be weighed or measured |
| Economics | Is the study of the decisions that go into making, distributing and using goods and service |
| Economy | Consists of the ways in which people make, distribute, and use their goods and services |
| Supply | Is the amount of goods and services available for sale |
| Demand | Is the amount of goods and services people are willing to buy |
| Federal Reserve System | Or the Fed, is the central banking organization of the United States |
| Inflation | This rise in the level of prices for goods and services |
| Consumer | A person who purchases and uses goods or services |
| Interest | Is the price that is paid for the use of another’s money |
| Time value of money | Which is the increase of an amount of money due to earned interest or dividends |
| Principal | The original amount of money n deposit |
| Future Value | the amount your original deposit will be worth in the future based on earning a specific interest rate over a specific period of time |
| Annuity | A series of equal regular deposits |
| Present Value | Which is the amount of money you would need t deposit now in order to have a desired mount in the future |
| Money management | Is planning how to get the most from your money |
| Safe- deposit box | A small secure storage compartment that you can rent in a bank, usually for $100 a year or less |
| Personal financial statement | A document that provides information about an individual’s current financial position and presents a summary of income and spending |
| Personal balance sheet | Also called a net worth statement, is a financial statement that lists items of value owned, debts owed, and person’s net worth |
| Net Worth | The difference between the amount that you own and the debts that you owe |
| Assets | Are any items of value that an individual or company owns, including cash, property, personal possessions, and investments. |
| Wealth | An abundance of valuable material possessions or resources |
| Liquid assists | Are cash and items that can be quickly converted to cash |
| Real estate | Land and any structures that are on it, such as a house or any other building that a person or family owns |
| Market value | The price at which property would sell |
| liabilities | The debts that you owe |
| insolvency | A financial state that occurs if liabilities are greater than assets |
| Cash flow | The money that actually goes into and out of your wallet and back accounts |
| income | Cash inflow is the money you receive |
| Take-home pay | Net pay, is the amount of income left after taxes and other dedications are taken out of your gross pay |
| Discretionary income | The money left over after paying for the essentials, such as food, clothing, shelter, transportation, and medication |
| surplus | Extra money that can be spend or saved, depending on a person’s financial goals and values. |
| deficit | The financial situation that occurs when more money is spent than is earned or received |
| budget | A plan for using money to meet wants and needs |
| Consumer price index | Which is measure of the changes in prices for commonly purchased goods and services in the united states |
| Budget variance | The difference between the budgeted amount and the actual amount that you spend |
