finance
overdraft fees
$35
U.S. Savings Bonds
A form of government debt issued to American citizens to help fund federal expenses.
Beneficiary
A person named to receive the benefits from an insurance policy
Money Market Account
A savings account that requires a minimum balance and earns interest that varies from month and month (the rate fluctuates based on the current market rate)
Certificate of Deposit (CD)
Alternative to savings account-money is left on deposit for a stated period of time to earn a specific (higher) rate of return.
5 C's of Credit
Character, Capacity, Capital, Collateral, Conditions
Internal Limits
Limits sets specific levels of repayment for certain services
commercial bank
Owned by investors They are in the business to make money
credit union
Owned by members May not have branches near you if you were to move
Tips for Using Credit Cards
Signed newly issued cards immediately carry only the cards you need Notify creditors immediately when a card is stolen or lost destroy (cut) expired cards Don't give credit card numbers and expiration dates by phone to people of businesses you don't know Make sure you don't give out credit card information over the internet if the site you are on is not a secure site - check for
Rate of Return
The % of increase in the value of your savings from earned interest. Rate of Return=total interest earned/original deposit
Annual Percentage Yield (APY)
The amount of interest a deposit earns after compounding for 1 year
Paying yourself first
The concept of setting aside a portion of your income for savings before spending any of it
Mutual Fund
Traded only once a day Can set up automatic payments of withdrawal Flat dollar amount
ETF
Traded throughout the day Can't make automatic investments or withdrawals Price of one share
bond
You lend money to the government or a company, and they agree to pay you back with interest.
Installment loan
a loan repaid with interest in equal periodic payments
Secured Loan
a loan where the borrower pledges property to assure payment
Layaway
a plan where merchandise is set aside in a customer's name until it is paid for
PMI
a policy that protects the lender in case the buyer cannot make payments.
Line of credit
a pre-established amount of money that can be borrowed on demand DISADVANTAGES future money tied up
Tax Savings
able to deduct interest charges on mortgage payments and property taxes from your federal tax return
Creditor
business or person that you're borrowing the credit from
Equity
difference between the value of your home and what you owe on it
Subsidized Loan
do not need to be paid back until 6-9 months after graduation (as long as you're enrolled in school part time) eligibility depends on income level and school costs interest occurs after graduation can only borrow a specific amount
There are 3 major US credit bureaus:
equifax experian transunion
Industry
group of companies that make the same products
Sector
group of stocks, often in one industry; Pharma companies are part of health care sector
part a part b
hospital medical
Home equity loan
loan based on difference between the current market value of a home and the amount the borrower owes on the mortgage
Unsubsidized Loan
low, fixed interest rate interest accrues day 1 of disbursement can only borrow a specific amount anyone can apply
Assigned Benefits
nsurance company makes direct payments to the doctor/hospital.
Finance Charge
pay for the use of a credit card ex.interest charge
Deferred billing
purchases are not billed to the customer until a later date
sources of credit
retail stores, finance companies, loan sharks, usury laws, pawnshops
stock
share of ownership in a publicly held company
Forbearance
temporarily stop making payments or reduce payment up to 12 months interest will accrue on subsidized and unsubsidized loans
Sticker Price
the college's published cost of attendance
Net Price
the difference between the two- the real amount that your family pays
Open-ended credit
the lender places a limit on how much a customer can borrow during a period of time
Amortization
the reduction of a loan balance through payments made over a period of time
Pro-rate
to divide over a period of time
Deferment
you do not make payments government may pay your interest