| A | B |
|---|
| interest | cost of borrowing money |
| Mortgage | loan to pay for a home |
| checking account | linked to check book and debit card, good for frequent transactions |
| savings account | good to leave your money in, low risk low reward, insured |
| numbers on a check | bank number and routing number, indicates where check should be sent and the account to withdraw from |
| 401(k) | pre tax money taken from your paycheck and put into investment account |
| C.D. | certificate of deposit - locks up your money for a set period of time |
| savings bond | very safe form of investment, get a pre determined amount of money back at maturity |
| depreciation | loss of value (think car driving off lot) |
| credit card | revolving account, pay a minimum and transfer monthly balance - pay interest |
| investment | saving or purchasing certain assets in the hopes of making a profit in the future |
| penny stock | most risky type of stock |
| 403(b) | retirement plan for school employees, money is taken out before taxes |
| risk v reward | higher the risk the higher the reward |
| FDIC | insures deposits in banks accounts up to $250,000 |
| Gross Pay | pay before taxes |
| net pay | pay after taxes |
| dividend | share of company profits paid to investors |
| diversification | distributing your investments across different areas |
| credit score | used by companies when determining loan decisions, 300 to 850 |
| FICO | company who determines your score using certain formulas |
| Interest | cost of borrowing money |
| budget | putting money aside every month for certain expenses |
| 529 plan | savings/investment plan grows tax free and used for college |
| liability insurance | required by state law, Covers bodily injury or property damage that you cause to another person and/or vehicle. |
| comprehensive insurance | covers damage to your car from natural disasters and occurrences, required on new or leased cars |
| collision insurance | covers the cost to repair your car from an accident that is your fault |
| unemployment insurance | protects you if you lose your job |
| fixed expense | doesn't change, like car or house payment |
| variable expenses | change every month, food costs, entertainment, etc |
| IRS | internal revenue service, monitors taxes |
| ways to lower your taxable income | charities, donations, 401k,403b, business write offs, etc. |
| commission | % of sales you get in pay |
| rule of savings | pay yourself first |
| rule of 72 | how long it takes money to double |
| market price | price someone is willing to pay for something (stock) |
| inflation | general rise in the level of prices |
| portfolio | all the various investments someone holds |
| mutual fund | an individual can buy one, easy way to diversify |
| bank statement | all the bank activity for the month |
| direct deposit | your pay is put directly into your account by your emplyer |
| bounced check | don't have enough money in your account to clear the check |
| credit union | non-profit bank run by its members |
| commercial bank | for profit bank, providing a variety of banking products |
