Financial Literacy Part C Flashcards
Define Saving
Setting aside money to spend later
Define Investing
Putting money into shares, properties or other financial schemes, aim to make a profit
Define Interest Rate
The amount of money borrower must pay lender for use of assets
Explain 2 Reasons Why People Save Money
- Earn more, earn interests from banks.
- Spend less, to monitor what is spent and prevent wasting money
Explain 2 Reasons Why People Set Saving Goals
- In case of emergencies, unexpected bills, e.g car trouble, medical expenses
- Aim to buy things that is currently unaffordable with everyday income
List 3 Steps to Set Saving Goals
- Identify what you would like to have in the future and how much it will cost
- Identify the amount of money you put aside per week or month
- Identify how long it will take to reach your goal
Define Deposit
Sum of money added or paid into an account, which contributes to the full purchase price
Define Principal
Money that was originally invested or loaned
Define Shares
Units of ownership in a publicly listed company
Define Shareholder
Individual that holds units of ownership in a publicly listed company
Define Investment Risks
The likelihood of losing money in a financial scheme
Define Share market
A market, Shares in publicly listed companies are bought and sold
Define Australian Security Exchange (ASX)
Operates Australia’s primary securities exchange, shares in one form of security can be traded via ASX
What is Investor and Broker?
*Investors
Have the money, do research and decide which stocks to buy and sell, take investment risks and earn profit
*Brokers
Execute investors’ trades on the exchange for a fee, Income relies on investor’s activity, they don’t take risks
List the 7 Types of Scams
*Charity scams
*Psychic and clairvoyant scams
*Romance scams
*Phishing scams
*Phone calls
*Covid 19 scams
*Impersonation scams
Define Scam
A scheme that is deliberately dishonest
What is Charity Scams?
-Scams that target your emotion
-A scammer poses as a genuine charity and asks for money, donation
E.g Red Cross
What is Psychic and Clairvoyant Scams?
-Scams that target your emotion
-Victim will be told they will be in some sort of trouble and have to pay for something like a lucky charm
What is Romance Scams?
-Scams that target your emotions
-Scammer uses emotional triggers to get a person to provide money, gifts or personal details
What is Phishing Scams?
-Investment and online account scams
-Pretend to be sent on behalf of your bank asking for account details
What is Phone Calls Scams?
-Investment and online account scams
-Scammers inform there is a problem with your account, asking you to provide account details or passwords
What is Covid-19 Scams?
-Investment and online account scams
-Phish for personal info online, online shopping and superannuation scams
-Surveys early access for vaccination, investment opportunity to vaccines
What is Impersonation Scams?
-Investment and online account scams
-Scammers pretend to have connections with their target
Identify 4 Ways to Protect Yourself Against Online Scams
- Don’t click on hyperlinks in text/social media messages or emails
- Never respond to a text, email or phone request for your details.
- Never give remote access to your computer to a stranger
- Use an independent source to verify the legitimacy of the contact
What is Personal Identification Number (PIN)?
Allows withdrawal of money from and deposit it into bank account
How to Keep Personal Info, like PIN ,safe?
*Don’t share Pin with anybody else
*Don’t keep Pin with card
*Don’t use any personal details as Pin
*Bank should not ask for Pin
*When using internet banking, remember to log out
What is Transaction Account?
An account used to pay bills and withdraw money for spending
What is Savings Account?
An account for depositing money and earning interest
What is Banking Fees and Provide Some Examples
A bank is a business which they will charge a fee for its banking services
*EFTPOS fees, using their services to pay have sur-charge.
*ATM fees, withdraw money using ATM have sur-charge
What is Skimming?
Criminals using electronic method to capture victim’s personal info like credit card details in ATMs
