A: Understand the importance of managing personal finance Flashcards
1
Q
What are the functions of money? (4)
A
- Unit of account
- Means of exchange
- Store of value
- Legal tender
2
Q
What are the roles of money? (6)
A
- Personal attitudes
- Life stages
- Culture
- Life events
- External influences
- Interest rates
3
Q
What are the common principles to be considered in planning personal finance? (11)
A
- Avoid getting into debt
- Control costs
- Avoid legal action and/or repossession
- Remain solvent
- Maintain a good credit rating
- Avoid bankruptcy
- Manage money to fund purchases
- Generate income and savings
- Set financial targets and goals
- Provide insurance against loss or illness
- Counter the effects of inflation
4
Q
What are the methods of payment? (14)
A
- Cash
- Debit card
- Credit card
- Cheque
- Electronic transfer
- Direct debit
- Standing order
- Pre-paid card
- Contactless card
- Charge card
- Store card
- Mobile banking
- Banker’s Automated Clearing Service (BACS) Faster Payment
- Clearing House Automated Payment Systems (CHAPS)
5
Q
What are the types of current account? (4)
A
- Standard
- Packaged, premium
- Basic
- Student
6
Q
What are the different types of borrowing? (6)
A
- Overdraft
- Personal loans
- Hire purchase
- Mortgages
- Credit cards
- Payday loans
7
Q
What are the different types of saving and investment? (6)
A
- Individual savings account (ISAs)
- Deposit and savings accounts
- Premium bonds
- Bonds and gilts
- Shares
- Pensions
8
Q
What are the different types of insurance? (6)
A
- Car
- Home and contents
- Life assurance and insurance
- Travel
- Pet
- Health
