1.8 - Financial Products and Services Flashcards
Financial advisers recommend saving a contingency fund roughly equal to what?
Three months net salary
Payday loan definition
A type of loan that is instantly available online or from a high street loan shop
What happens when someone applies for a payday loan?
The lender carries out a credit check and if the customer is accepted, the money can be transferred to their account within 30 minutes
Who are payday loans aimed at?
Employed people who experience a cash-flow problem at the end of the month, but do not have an emergency fund or overdraft
What amounts are payday loans for?
Quite small amounts (hundreds)
Who are logbook loans available to?
Car owners, who pass over the ownership documents of their car to the lender as security for an instant loan
Different types of insurance
- General insurance
- Life insurance
- Income protection insurance
- Critical illness cover
What is income protection insurance also known as?
Permanent health insurance
A pension earns interest free of which tax?
Income tax
Different types of pension
- State pension
- Occupational pension
- Personal pension plans
- Stakeholder pensions
- NEST
What is the state pension funded by?
The individual’s National Insurance contributions
What does state pension eligibility rely on?
A person’s National Insurance Contribution record
Employers have to enrol all employees of what age into an occupational pension scheme?
22 years and over
Main forms of investments for individuals
- Shares and bonds
- Property
- Non-financial investments
