Personal Finance Key Terms Flashcards
Asset
Anything of value that is owned by an individual
Investments
Money put into an account intended for growth
Budget
A monthly plan for how you are going to save and spend your income
Liability
Anything you owe;A debt
Compound Interest
Interest paid on an investment and on any interest previously earned
Net Worth
The total value of a persons value (things owned) minus their liability’s (things owed); May be a positive or negative dollar amount
Consumer
A person or organization that purchases a product or service
Nonprofit Organization
A federally recognized, tax-exempt organization such as a church, hospital, charity, or school that serves the public in some capacity
Credit
The granting of a loan and the creation of debt
Personal Finance
All the money decisions a person or family makes including earning, budgeting, saving, spending, planning for the future
Debt
An obligation to repay borrowed money
Expense
The cost of goods or services
Simple Interest
Interest paid only on the principal investment
Interest
The charge for borrowed money generally defined as a percentage; Also, the earned interest on money you save or invest
Scarcity
An unlimited amount of wants but limited resources
