financial literacy cards

Question 1

Costs of applying for a credit card

Answer 1

• Grace period
• Annual Percentage Rate (APR)
• Annual fees
• Transaction fees
• Balancing computation method for the finance charge

Question 2

Features of applying for a credit card

Answer 2

• Credit limit
• How widely the card is accepted
• What services and features are available

Question 3

Credit card dos and don’t

Answer 3

• Shop around (look at various sources)
• Read and understand the contract (read the contract fully, don’t rush into signing anything, once a contract is signed get a copy, etc)
• Know your cost (Figure out the total cost while paying with credit, make the largest payments possible, etc.

Question 4

Types of savings account

Answer 4

• Passbook account
• Statement account
• Interest-earing account

Question 5

money market deposit accounts

Answer 5

• they are checking and saving accounts

- you can have immediate access to your money thru ATMs, a teller, or by writing up to three checks a month.

Question 6

Certificate of deposit

Answer 6

-Bank pays a fixed amount of interest for a fixed amount of money in a fixed amount of time. There are no risks

Question 7

Things you should look for when choosing a savings account.

Answer 7

• The interest rate (all money earned come from this factor)
• Fees, charges, and penalties (usually based on minimum balance requirements, or transaction fees.)
• Balance requirements

Question 8

ways to invest in real estate

Answer 8

• buy a house, live in it, sell it for a profit
• buy income property
• buy land, hold it till its value goes up

Question 9

advantages and disadvantages of real estate

Answer 9

-excellent protection against inflation( prices going up)

• can be difficult to turn into cash
• a specialized type of investment requiring study and knowledge of the business

Question 10

retirement plans

Answer 10

• plans that help individuals set aside money to be used after they retire

Question 11

advantages of using credit

Answer 11

• able to buy needed items now
• don’t need to carry cash
• creates a record of purchase
• more convenient than writing checks
• consolidates bills into one payment

Question 12

disadvantages of using credit

Answer 12

• Interest (higher cost of items)
• may require additional fees
• financial difficulties may arise if one doesn’t keep track of one’s spending habits
• Increased impulse buying may occur

Question 13

The five cs

Answer 13

• character- will YOU repay the debt
• capital- what if you don’t repay the debt
• capacity- can you repay the debt
• collateral- do you have assets that can be leveraged against the debt
• conditions- are the conditions that may affect your ability to repay

Question 14

your responsibility of credit

Answer 14

• borrow only when you can repay
• read and understand the credit contract
• pay debts promptly (immediately)
• notify creditor if you cannot meet payments
• report lost or stolen credit cards
• never give your credit card to someone over the phone unless you initiated the call.

Question 15

Salary

Answer 15

An amount of money paid to an employee by the employer.

Question 16

federal tax

Answer 16

money used by the government to pay for the growth and upkeep of the country.

Question 17

income tax

Answer 17

A type of tax the government imposes on income-generating businesses. Income taxes are a source of revenue for the government. They use it to fund public services, etc.

Question 18

CPP

Answer 18

A Canadien pension plan is a monthly, taxable benefit that replaces part of your income when you retire.

Question 19

EI

Answer 19

The employment insurance program provides temporary income support to unemployed workers while they look for employment or to upgrade their skills.

Question 20

Pension

Answer 20

A pension is a fund into which a sum of money is added during an employee’s employment years and from which payments are drawn to support the person’s retirement.

Question 21

YTD gross

Answer 21

Amount of money a person earned for the year before deductions

Question 22

YTD net pay

Answer 22

Amount of money a person earned after deductions

Question 23

YTD deductions

Answer 23

Amount of money deducted from a person ytd gross

Question 24

union dues

Answer 24

Union dues are a regular payment of money made by members of unions.

Question 25

long term disability

Answer 25

an insurance policy that protects an employee from loss of income in the event that he or she is unable to work due to illness, injury, or accident for a long period of time

Question 26

net pay

Answer 26

The amount of money the employee takes home, not the amount of money it costs to employ them.

Question 27

Fixed expenses

Answer 27

Any expenses (that the cost) that do not change from period to period. Like mortgage or rent payments.

Question 28

Variable expenses

Answer 28

A variable cost is a corporate expense that changes in proportion to production output. Variable costs increase or decrease depending on a company’s production volume

Question 29

saving bond

Answer 29

Savings bonds are a lower-risk way to save. When you buy a savings bond
you are loaning money to the government for a set period at a fixed interest rate.

Question 30

Paystub

Answer 30

a piece of paper that is given to an employee with each paycheck and that shows the amount of money that the employee earned and the amount that was removed for taxes, insurance costs, etc.

Question 31

Checking account

Answer 31

A bank account that allows easy access to your money. They usually offer low risk or no interest.

Question 32

How much debt should you have compared to your income?

Answer 32

A ratio of 30% or less is a healthy relationship. Anything above 43% is a cause of concern.

Question 33

Expenses

Answer 33

the cost required for something. The money spent on something

Question 34

Deductions

Answer 34

an expense that can be subtracted from a person’s income in order to reduce the amount owed.

Question 35

Mutual funds

Answer 35

Professionally managed portfolios made up of stocks, bonds, and other investments.

Question 36

stocks

Answer 36

represent ownership of a corporation. Stockholders own a share of the company and are entitled to a share of the profit as well as a vote in how the profit is run.