BUSFIN 3120 FINAL

What home owners insurance covers

-Building in which you live in and other buildings on the property -Additional living expenses -Personal Property -Personal liability and related coverage -Specialized coverage -household inventory with documenation

Benefits of Renting

-Easier to move -Lower initial costs -Fewer maintenance and repair responsibility -Minimal financial commitment

Benefits of Buying

-Pride of ownership -Financial benefits -lifestyle flexibility -

Co-op housing

A form of housing in which a building containing a number of housing units is owned by a non-profit whose members rent the units

Open ended credit

A line of credit in which loans are made on a continuous basis and the borrower is billed periodically for at least a partial payment -Credit Card

Revolving Check credit

A prearranged loan from a bank for a specified amount that can be used by writing a special check Repayment is made in installments over a set period of time

Stop-Loss

A provision under which an insured pays a certain amount, after with the insurance company 100% of the REMAINING covered expenses

Co-insurance

A provision under which both the insured and the insurer share the covered loss

Money Market Accouns

A savings account offered by banks, savings and loan associations, and credit unions that requires a minimum balance and has earnings based on market interest rates

Certificate of Deposit (CD)

A savings plan requiring that a certain amount be left on deposit for a stated time period to earn a specified interest rate of return range from 30 days to five or more years penalty imposed for early withdrawal of money

Asset Management Account

An all in one account that includes checking, savings, borrowing, investing, and other financial services for a single fee Offered by brokers and financial institutions (also known as a cash management account)

Exclusion

An amount not included in gross income. Also known as tax-exempt income

Condominium

An individually owned housing unit in a building with several such units -You own your unit in a building of units -Not a type of building but form of home-ownership

Mutual Fund

An investment vehicle that is made up of a pool of funds collected from many investors for the purpose of investing in securities such as stocks, bonds, money market instruments and similar assets.

Ch 13

Debtor with regular income proposes a plan for using future earning or assets to eliminate his or her debts over a period of time debtor usually keeps all or most of property Must provide same info as required for chapter 7

Equity

Difference between total value of assets and total value of liabilities

Itemized deductions

Expenses that can be deducted from adjusted gross income, such as medical expenses, real estate property taxes, home mortgage interest, charitable contributions, casualty losses, and certain work related expenses.

Negligence

Failure to take ordinary or reasonable care in a situation

Medicare

Federal program for those age 65 and older and certain disabled persons -Part A= hospital visits including the doctor -Part B= voluntary if you have proof of coverage office visits and prescriptions

Balance Sheet

Financial statement showing what an individual or a family owns and owes, also called a net worth statement Shows Assets, Liabilities, and Equity. Tells you where you are now

Earned Income

Money received for personal efforts, such as wages, salary. commission, fees, tips, or bounuses

Closed ended credit

One time loans that the borrower pays back in a specified period of time in payments of equal amounts -Used for specific amount and specific purpose -Ex. Auto loans and mortgage l0ans

Disability Income Insurance

Provides regular cash incomes lost by employees as the result of an accident, illness, or pregnancy Sources: social security Employer Workers Comp Private income insurance -

Deducible

The set amount the policyholder must pay per loss on an insurance policy -Tree falls on car=you have to pay $200 insurance will pay the rest

Assets

What the company owns Current Asset=convert to cash within 12 months Liquid Assets Real Estate Assets Investment Assets Personal Possessions

Liabilities

What the firm owes Current liabilities < 12 months Long term liabilities

Insolvency

When debts can not be paid due to liabilities being greater than assets

Passive Income

Income resulting from business activities which you do NOT activity participate in

Liability Insurance

Legal responsibility for the financial cost of another persons losses or injuries

Ch 7.

Individual must list assets and liabilities straight bankruptcy many but not all debts are forgiven Most of your assets are sold off to pay crediors

Compute Net Worth

Assets-Liabiliteis

Medium Loans

Come from commercial banks as well as loan associations and credit unions

Cheap Loans

Come from family with low or no interest

Expensive Loans

Come from finance companies as well as retail stores and check cashing companies. interest rates are high, however these are the easiest types of loans to recieve