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Definition
| Being knowledgeable and informed with managing money and assets, banking, investments, credit, insurance, and taxed. |
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Term
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Definition
| The Standard of living is what is pursued. A state in which you hope to be living in. |
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Term
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| Gross Domestic Product; Broadest measure of economy in a country. Tracks all goods and services. |
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Definition
| Index of Leading Economic Indicators; Done by a counsel averages 21 things such as building permits and factory orders. |
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| Tools to determine the future of the conomy. |
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Definition
| GDP, LEI, Uneployment, inflation |
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Term
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Definition
| Inflation is a steady rise in price levels. |
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Term
| Consumer Confidence Index |
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Definition
| Gives a sense of consumer's willingness to spend. |
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Term
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Definition
| The rate which banks charge each other for overnight loans. |
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Term
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Definition
| A forumal for figuring the number of years it tkaes to double the principal using compound interest; simply divide the interest that money will earn into 72. |
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Term
| Flexible Spending Account |
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Definition
| Allows employees to fund qualified medical or dependent expenses on pretax basis by reducing take home salary. |
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Term
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Definition
| Any form of compensation that is not strictly monetary. |
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Term
| Marginal Cost v. Marginal Utility |
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Definition
| Marginal Cost is the cost of an upgrade (150 dollar concert ticket as opposed to a 90 dollar concert ticker) and Marginal Utility is what you gain from the increase. (Front Row Seat as opposed to balcony) |
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Term
| Commission Only Financial Planners |
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Definition
| Only charge for what they do, this is advantageous if you aren't doing much more than a few transactions here and there. |
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Term
| Fee-only Financial Planners |
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Definition
| They are honest because there is no commission involved, they simply charge you for services. They want your business so you doing well is their top priority. |
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Term
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Definition
| The opportunity cost of any decision is the value of the next best alternative that must be forgone. |
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Term
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Definition
| Stream of payments to be received in the future. |
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Term
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Definition
| Tax-deductible savings accounts into which individuals or employers can deposit tax-sheltered funds to pay future medical bills. |
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Term
| Disposable Income v. Discretionary Income |
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Definition
| Disposable income is money to spend after taxes whereas discretionary income is money leftover after taxes and necessities are paid off (gas, food, rent) |
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Term
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Definition
| A Summary of all income and expense transactions over a specific time period. |
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Term
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Definition
| Variable budgeting tool that places funds in savings to cover large irregular or higher-than-usual expenses. |
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Term
| Defined Contribution Plan |
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Definition
| A retirement plan designed to provide a lump sum at retirmenet; it is distinguished by its "contributions" - the total amount of money put into each participating employee's individual account. |
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Term
| Tax Avoidance vs. Tax Evasion |
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Definition
| Tax avoidance is fine, that is the strategic method of paying taxes, tax evasion is illegally hiding income... cheating. |
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Term
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Definition
| An electronic fund transfer in which money is shifted from account to account... electronically. |
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Term
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Definition
| The Federal Deposit Insurance Corporation (FDIC) is a United States government corporation created by the Glass-Steagall Act of 1933. It provides deposit insurance, which guarantees the safety of deposits in member banks, currently up to $250,000 per depositor per bank. The FDIC insures deposits at 8,246 institutions with $13.5 trillion in assets. |
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Term
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Definition
| Number of months you could continue to function if all sources of income were to vanish. Monetary Assets/Monthly Expenses |
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Term
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Definition
| Compares total assets with total liabilites. Total assets/Total Debt |
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Term
| Investment Asset to Total Asset Ratio |
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Definition
| Compares investment asset value with net worth. Investment Assets/Total Assets |
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Term
| Higher Education Tax Breaks |
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Definition
| The Hope Scholarship Credit is 1650 claimed per student for tuition, and the Lifetime Learning Credit which amounts to 20% of the first 10,000 paid. |
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Term
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Definition
| Refers to all income in the form of money, goods, services, and/or property. |
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Term
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Definition
| Income for which taxes are levied. |
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Term
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Definition
| Gross Income less any exclusions and adjustments. |
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Term
| Marginal Tax Rate v. Average Tax Rate |
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Definition
| The marginal tax rate is the summation of all taxes that you pay, from federal to medicare and social security. The average tax rate is the proportion of total income you pay in taxes. |
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Term
| Liability for lost ATM or debit card |
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Definition
| Up to $50 if reported within 2 days, after that up to $500, no limit 60 days after statement was mailed |
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Term
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Definition
| Saving enough money to cover living expenses (perhaps 70 percent of gross income) for three to six months in case of financial emergency. |
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Term
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Definition
| An interest-earning savings instrument purchased for a fixed period of time. |
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