Borrowing, Savings and Investment, Insurance Flashcards
BORROWING
1) OVERDRAFT
2) PERSONAL LOAN
3) HIRE PURCHASES
4) MORTGAGE
5) CREDIT CARD
6) PAYDAY LOAN
SAVINGS AND INVESTMENT
1) INDIVIDUAL SAVINGS ACCOUNT (ISA)
-allows you to save with no tax
-up to £20K
2 types of ISA
1) Cash ISA - interest is paid tax free
2) Stocks and Shares - funds are invested in shares or bonds and profits earned are tax free
Other types of ISAs
Help to buy ISAs - to help them save to buy property
Cash ISAs are less risky than stocks and shares ISAs
Stocks and shares could also result in financial losses
2) Deposit and Savings Accounts
- easy access savings accounts allows you instant access to your savings
- interest variable, taxable
3) Premium Bonds
- no Interest
- max £50K
- no interest earned
- chance to win a tax free cash price
4) Bonds and Gifts
- fixed
- can fall value
5) Shares
- receive dividends
- shareholders may lose their investment
6) Pension
- LT savings for retirement
- employees pay into the state pension through NI contributions
INSURANCE TYPES
1) Car insurance
2) Home and contents
3) Life assurance and insurance
4) Travel
5) Pet
6) Health
HOME INSURANCE
1) Building insurance - covers structure and fixed fittings
2) Contents insurance - covers your stuff
3) Accidental cover - if you cause damage through an accident, the insurer will pay to replace
Additional protection:
4) Legal insurance - covers up to £50k legal fees
5) Alternative accommodation - cover if you can’t live in the house
6) Lost key cover
CAR INSURANCE
1) Basic cover - third party cover if involved in an accident (but damaged to own car not covered), injuries to passengers is covered, no cover theft or fire, cheapest option
2) Middle level cover - third party, fire and theft all covered, affordable option
3) Best cover (but expensive) - comprehensive
- covers damage to the car
- covers third party damage if you have an accident
- includes courtesy car
