| A | B |
|---|
| Bonds | Type of debt a company issues to investors for a specific period of time. |
| Brokerage Firm | Facilitates buying and selling of investments froma stock exchange. Purchasing stocks wiht money received from income tax return |
| Capital Gain | Unearned income received from the sle of an asset above purchased price |
| Certificate of Deposit | Funds deposited ina CD held for a certain length of time |
| Checking Account | Saving tool to help manage everyday purchases. |
| Compound Interest | Earning interest on interest |
| Debt-to-Income Ratio | Recommended educational loan payments require no more that 10/15% of estimated income |
| Discount Brokerage Firm | Only completes orders to buy and sell investments |
| Diversified Portfolio | Decrease risk by investing money in a variety of investment tools |
| Dividend | The share of profits distributed in cash |
| Financial Advisor | Trained professional helping people make investing decisions |
| Inflation on Investment Returns | The rise in General level of prices |
| Investing in Stocks | Stock holders will always receive a profit when the stock ins sold, ( IS NOT A TRUE STATEMENT) |
| Liquidity | How quickly and easily an asset can be converted into cash |
| Money Market Account | Money earns depends on higher balance. Higher the tirered interest rate, minimum balance requirement |
| Mutual Funds | Diversified investments. Combining the funds of many different investors and then invest money |
| Opportunity Cost | Money one would have earned if they had worked instead of continuing their education |
| Paying Taxes on Investments | Taxes are often owed on profits generated from investments |
| Pay Yourself First | Setting aside predetermined amount of money for saving before using any of the money on spending |
| Rate of Inflation/ Rate of Return | Higher, to maintain purchasing powder |
| Risk and Return | Higher risk indicates higher return |
| Savings Accounts | Designed to hold money not spent on current consumption. More liquid than a certificate of deposit |
| Saving Tools | Accounts offered, whose main purpose is to help manage money, and protected by he US Government against loss |
| Security Level of Savings Tools | Savings tools are secure because they are protected by the US Government against loss |
| Stocks | Share of ownership in a company |
| Stock Exchange | Organized central services to buy and sell stocks, bonds and other investments that are traded |
| Tax Advantaged Investment | Investment that is structured to have tax benefits |
| Tiered Interest Rate | Amount of interest earned on the account balance |
| Time Value of Money | Invest as long as possible and at the highest interst rate possible |
| Trade-Off | Example: Giving up food from the vending machine to save $100.00 a month for emergency funds |
