WISE EXAM REVIEW I Flashcards
Discretionary Income
money left over from paying all your bills
Emergency Fund
3-6 months set aside in the event of an emergency
Fixed Expense
a consistent amount of income received every month
Variable Expense
income that varies from month to month
Annual Percentage Rate
your interest rate divided by 12
Buying Power
the extent to which your money can buy good; purchasing power
Compound Interest
interest that is added on to preexisting interest
Simple Interest
basic interest; generally used for debt
Federal Reserve Bank
sets the interest rates for banks across the U.S and is responsible for monetary policy; government ran
ABA Number/ Check Routing Number
states which bank the check belongs to; the first number at the bottom left corner of the check
ATM Card
acts as a debit card
Automatic Bill Payment Service
A service that automatically pays your bills using money from your debit account
Bank Statement
displays all of the money flowing in and out of your bank account
Car Loan
a loan used to purchase a car
Cashier’s Check/ Money Order
a guaranteed form of payment
Check Cashing Centers
a place you can go to do things you would do at a bank; more expensive than a bank
Certificate of Deposit
non-liquidable;
Check Fraud
attempting to use an empty check to make a purchase
Collateralized Loan
when you have a repossessable asset attached to a loan
Credit
the concept of owing money
Credit Card
a card used to make purchases that you don’t immediately have the money for
Credit Union
non-profit, ran by its own members, has lower fees
Debit Card
a card used to access money from your checking account
Endorsement
a check given from one person to another
Federal Deposit Insurance Corporation
a $250,000 protection provided to bank users
Liquidity
how fast you can turn an asset into cash
Most Liquidable
money Market, checking/ Savings Account, Cash
Least Liquidable
certificate of Deposit, home, investments
Consumer Debt
the concept of a consumer owing massive amounts of money
Cosigned Loans
the process of an individual vouching for you when getting a loan
FICO
your credit score
FICA
social security
What goes into a credit score?
payment history (most important), debt to income ratio, and age of account
Due Date
the date your bills are due
Finance Charge
all the different fees that are attached to a loan
Short-Term Goal
a financial goal that can be accomplished in under a year
Long-Term Goal
a financial goal that takes over a year to accomplish
Time Value
the more time we give money to develop interest, the more value it has
Money Market Account
a different type of savings account
Pawn Shop
a business responsible for distributing collateralized loans
Promissory Note
another name for a loan
Redlining
discriminatory housing; illegal
Securities
stocks and bonds
Bonds
grows slower than stocks; less risk
Garnishment
when someone takes money out of your paycheck before you receive it
Installment Loan
when you owe a fixed amount of money from month to month
Interest
Money added to the principal owed every month
