| A | B |
|---|
| PAC | Pre-Authorized Check |
| Rule of 72 | 72/by interest rate= Years to double |
| 3 Reasons to Save | Emergencies, Big Purchases, Wealth Building |
| Best interest accounts for emergency funds | Low interest rates |
| Best interest accounts for retirement accounts for a young person | High interest rates |
| Emergency Fund | 3 to 6 months of bring home pay in a liquid account |
| Liquidity | How easily assets can be converted into cash. |
| Sinking Roof Fund | Estimating future total cost of an item, figuring payments for set amt. of time, pay yourself that amount to buy with cash |
| Principal | The most commonly used refers to the original sum of money borrowed in a loan or put into an investment. |
| Two upfront costs associated with renting | 1st & Last Months Rent & Damage Deposit |
| Two upfront costs associated with buying a house | Down Payment & Closing Costs |
| Landlord | Person who owns the property or house that you are renting or leasing |
| Tenant | Person who is renting or leasing a place |
| 80% | Percentage do you have to be under in order to not have Private Mortgage Insurance (PMI) on a home loan |
| 34% | Total monthly budget allocated for housing |
| 19.3% | Total suggested for rent in a monthly housing budget |
| 6.4% | Total suggested for utilities in a monthly housing budget |
| 3.3% | Total suggested for furnishings in a monthly housing budget |
| 3.7% | Total suggested for household supplies and operations in a monthly housing budget |
| Components of a mortgage payment | Cost of the home, interest, taxes, homeowner's insurance, PMI (Private Mortgage Insurance |
| PMI (Private Mortgage Insurance covers who against who | Mortgage lender against the consumer defaulting |
| Ways to be paid | Paper Check, direct deposit, and payroll card |
| Gross Income | Amount of money earned before payroll taxes |
| Deductions | Amount withheld from your paycheck |
| Mandatory & Optional | Two types of deductions |
| Net Income | Amount of take home pay (Gross pay - Mandatory and Optional Deductions) |
| Income Deductions | State and federal taxes |
| Payroll Deductions | Medicare and Social Security |
| True about both Medicare and Social Security | Employer must match what the employee contributes |
| Form filled out when accepting a job or after any major life change like getting married | W-4 |
| Allowances | Number of dependents that may be claimed on a W-4 |
| Dependents | Qualifying child or adult relative |
| Optional Deductions | Retirement account, medical insurance, and flex-spending accounts |
| Mandatory Deductions | Income and Payroll taxes |
| Social Security | Income for: Retirees, People with profound disability Children who have lost a parent, A person with children who has experienced the death of a spouse |
| Medicare | Helps pay for health care for individuals 65 and older |
