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Financial Planning > Topic 1 Volcab > Flashcards

Topic 1 Volcab Flashcards

0
Q

The study of personal and family resources concert important in achieving financial success: involves how people spend, save, protect and invest their financial resources

A

Personal finance

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1
Q

Knowledge of facts, concepts, principles and technological tools are fundamental to being smart about money

A

Financial literacy

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2
Q

Means that you are accountable for your future financial well-being and that you strive to make wise personal financial decisions

A

Financial responsibility

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3
Q

Giving up one thing for another

A

Trade-off

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4
Q

Income not spent on current consumption

A

Savings

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5
Q

Assets purchased with the goal of providing additional income from the outset itself

A

Investments

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6
Q

Material well-being and peace of mind that individuals or groups earnestly desire and seek to attain, to maintain attained, to preserve or threatened and regain of lost

A

Standard of living

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7
Q

Achievement of financial aspirations that are desired, planned, or attempted as defined by the person who seeks it

A

Financial success

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8
Q

Comfortable feeling that her financial resources will be adequate to feel any need to have as well as most of your wants

A

Financial security

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9
Q

Experience you have when you were satisfied with your money matters, which is in part a result of practicing good financial behaviors

A

Financial happiness

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10
Q

Condition of increasing production business spending and consumption consumer spending in the economy and has increasing national income

A

Economic growth

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11
Q

Business cycles can be depicted as a wavelike pattern of rising following: phases of business cycle include expansion, peak, contraction, trough

A

Business cycle/economic cycle

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12
Q

Recurring period of decline in total output, income, employment, and trade usually lasting from six months to a year and Mark I widespread contractions and many sectors of economy

A

Recession

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13
Q

Time. When credit use shrinks in an economy instead of expanding as during normal economic times

A

Deleveraging

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14
Q

Occurs when the economy has a recession and then soon after emerging from her session with the short period of growth quickly falls back into recession

A

Double-dip recession

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15
Q

Any economic statistics such as unemployment rate GDP or inflation rate that suggests how well the economy is doing now and how well it might be doing in the future

A

Economic indicator

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16
Q

Nations broadest measure of economic health: reports how much economic activity has occurred within the US borders during a given period

A

Gross domestic product GDP

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17
Q

Statistics to change before the economy changes, that’s helping predict how the economy will do in the future such as stock market number of new building permits and consumer confidence index

A

Leading economic indicators

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18
Q

Economic indicator that moves in the same direction as the economy

Moves in the opposite direction of economy

A

Pro cyclic

Counter cyclic

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19
Q

Study and sustained rise in general price levels across sectors measured by changing cost overtime of market basket of goods and services that are typical household my purchase

A

Inflation

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20
Q

Composite index reported monthly by the conference board that suggests a future direction of economy

A

Index of leading economic indicators LEI

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21
Q

Broad sustained kind of prices of goods and services that is hard to stop once it takes hold, causing less consumer spending, or corporate profits, declining home values, rising unemployment, lower incomes

A

Deflation

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22
Q

Measure of goods and services that one’s income will buy

A

Purchasing power

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23
Q

Income measured in constant prices relative to some bass time period. It reflects the actual buying power money you have is measured in constant dollars

A

Real income

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24
Q

Also called money income: income that has not been adjusted for inflation and decreasing purchasing power

A

Nominal income

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25
Q

Brought a measure of changes in the prices of all goods and services purchased for consumption by urban households

A

Consumer price index CPI

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26
Q

Short-term rate at which depository institution one balances at the federal reserve two other depository institutions overnight

A

Federal funds rate

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27
Q

Price of Borrowing money

A

Interest

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28
Q

Opportunity cost of any decision is the value of the next best alternative that must be forgone

A

Opportunity cost

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29
Q

Extra satisfaction derived from gaining one more incremental unit of a product or service

A

Marginal utility

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30
Q

Additional cost of the more incremental unit of some item

A

Marginal cost

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31
Q

Tax rate at which your last dollar earned is text

A

Marginal tax rate

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32
Q

Income that is totally and permanently for of taxes

A

Tax-exempt income

33
Q

And come exempt from income taxes in the current year but will be subject to taxation in a later year

A

Tax sheltered income

34
Q

Original amount invested

A

Principal

35
Q

earning of interest on interest and arises when interest is added to the principal so that, from the moment on, the interest that has been added also earns interest

A

Compound interest

36
Q

Addition of interest and principal: the effect of compounding depends on the frequency with which interest is compounded on the periodic interest rate is applied

A

Compounding

37
Q

Variation of an asset projected to the end of particular time period in the future

A

Future Value

38
Q

Formula for figuring the number of years it takes a double the principal using compound interest: simply divide the interest-rate that the money will learn into the number 72

A

Rule of 72

39
Q

Current value of an asset that will be received in the future, also known as discounted value

A

Present value

40
Q

Compensation from employment that does not take the form of wages, salaries, commissions or other cash payments

A

Employee benefit

41
Q

Type of employee benefit plan where employees choose the benefits from a menu of taxable cash and or one more qualified non-taxable benefits, thereby providing funding mechanism by which employees may pay for the benefits they choose on a pretax basis

A

Cafeteria plan

flexible benefits plan

42
Q

Employee benefit design to pay all or part of employees medical expenses

A

Health care plan

43
Q

Plan that requires individuals to pay a higher deductible to cover medical expenses before insurance plan payments begin: chosen to save money on premiums

A

High deductible health care plan HD HP

44
Q

Special savings account intended for people who have a high deductible health care plan

A

Health savings account

45
Q

Advantages bestowed by legislation that reduce attacks on some preferred activity, such as employee participation and employers cafeteria plan, health savings account or retirement plan

A

Tax advantages

46
Q

Employer-sponsored account as employee paid expenses for medical and dependent care to be paid with employees pretax dollars rather than after-tax income

A

Flexible spending account

47
Q

Money income that has not been taxed by the government

A

Pretax dollars

48
Q

Employee sponsored, defined contribution retirement plan such as 401(k) or similar

A

Tax sheltered retirement plan

49
Q

Written document that spells out relationship between investor and advisor, guides how advisor will invest peoples money, do you tell people’s investment philosophy, financial situation and risks willing to be taken

A

Investment policy statement

50
Q

Finding employment that will use your interests, abilities and will support you financially

A

Career planning

51
Q

Plan that identifies employment that interests you come up with your buddies, skills, worked out, lifestyle and provide strategic items to help you reach your career goal

A

Career plan

52
Q

Long-standing topics and activities that engage your attention

A

Professional interests

53
Q

Scaled surveys and assess career interests and activities

A

Interest inventory

54
Q

Identifying what you want to do for a living weather specific job orfield of employment

A

Career goal

55
Q

Describes progression for entry-level position to higher levels of pay scale responsibility and authority

A

Career ladder

56
Q

When demands particular job with your social and cultural preferences

A

Lifestyle trade-offs

57
Q

Job related activities that you can perform physically, mentally, artistically, mechanically, financially

A

Professional abilities

58
Q

Natural abilities and talents that individuals possess

A

Aptitude

59
Q

Your own way of working with and respondents job requirements surroundings associates

A

Works style personality

60
Q

Forms of remuneration provided by employers to employees the result of an employee not having to pay out-of-pocket money for certain expenses also known as non-salary benefits

A

Employee benefits

61
Q

Specific objectives addressed by planning and managing finances

A

Financial goals

62
Q

Preestablished action plan implemented in specific situation

A

Financial strategies

63
Q

Snapshots that described individuals current financial condition

A

Financial statements

64
Q

Shut up assets, liabilities, net worth of a particular date

A

Balance sheet or net worth statement

65
Q

Summary of all income and expense transactions over specific time

A

Cash flow statement or income and expense statement

66
Q

Obligation paid off within one year

A

Short-term current liability

67
Q

Obligation to be paid off in more than one year

A

Long term noncurrent liabilities

68
Q

When a person I was more than he or she owns and has a negative net worth

A

Insolvent

69
Q

Calculations designed to simplify evaluation of financial strength in progress

A

Financial ratios

70
Q

Speed and ease with which an asset can be converted to cash

A

Liquidity

71
Q

Documents that evidence financial transactions

A

Financial records

72
Q

Financial targets to Cheeves more than five years and future

A

Long-term goals

73
Q

Financial targets the can be achieved within 1 to 5 years

A

Intermediate term goals

74
Q

Financial targets that can be achieved in less than a year

A

Short-term goals

75
Q

Piercy it after employer withholding for taxes, insurance, union dues

A

Take-home pay/disposable income

76
Q

Money left over after necessities are paid for

A

Discretionary income

77
Q

Variable budgeting tool the places from the savings to cover emergency or higher than usual expenses

A

Revolving savings fund

78
Q

When budget estimates different from actual expenditures

A

Budget exceptions

79
Q

Detailed listing of plan expenses within a single budgeting classification like a vacation

A

Subordinate budget

80
Q

Placing exact amounts and envelopes for each budgetary purposes

A

Envelope system

81
Q

Difference between amount budgeted an actual mounts been to received

A

Budget variance

Financial Planning (3 decks)

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