Things you need to live, such as food, water, shelter.

Things you do not need to live, such as a car, phone, or video game.

Requirements that can be satisfied within a year, such as emergency savings.

Requirements that take about 10 years to fulfill, such as retirement savings.

Includes both U.S. and international investments.

Invests only in markets outside the U.S.

A mutual fund that invests in short-term, liquid securities with the lowest risk.

Stocks that pay high dividends to investors.

Stocks that typically do not pay dividends and are expected to grow over time.

A mutual fund that invests in a mix of stocks and bonds.

The legal process of minimizing tax liability on income tax returns.

The deadline for filing personal income tax returns in the United States.

The cost of borrowing money, which affects spending and saving behaviors.

A retirement savings plan offered by for-profit employers allowing employees to save and invest part of their paychecks.

A tax-deferred retirement savings account where up to $7,000 can be set aside annually.

A retirement account that allows you to withdraw money tax-free; taxes are paid upfront.

Equity that pays fluctuating dividends and is paid after preferred stock in case of liquidation.

Equity that pays fixed dividends and gets paid first if a company liquidates.

Stocks that are resistant to economic downturns, such as utility companies.

Stocks that follow the business cycle, like those in hotel or airline industries.

Stocks of well-established companies known for their financial stability.

Cheap stocks, typically under $5 each, with higher risk and potential for high reward.

Total earnings before deductions such as taxes and other withholdings.

Income remaining after all deductions and taxes are taken out.

Interest calculated only on the principal amount; does not include compounded interest.

A low-risk account used for emergencies, typically with a lower interest rate.

Regular investing over time, often for retirement.

Managing a portfolio with a more focused investment strategy.

Investing with a high level of risk for potentially high returns.

A market condition in which prices are rising or expected to rise.

A market condition in which prices are falling or expected to fall.

A measurement of a section of the stock market, calculated from the prices of selected stocks.

A marketplace where stocks are bought and sold.

Monthly expenses that fluctuate, like food or entertainment.

Recurring expenses that do not change, like rent or mortgage payments.

The profit made from selling an asset for more than its purchase price.

Investment grows without being taxed until withdrawal, as in Traditional IRAs.

Accounts like Roth IRAs where taxes are paid before contributions.

A bond that can be redeemed before its maturity at the issuer’s discretion.

A bond that can be converted into a predetermined amount of the company’s equity.

The difference between assets (what you own) and liabilities (what you owe).

The ease with which an asset can be converted into cash.

Reasons for financial failure, including job loss, health problems, and divorce.

The rate at which the general level of prices for goods and services rises, eroding purchasing power.

Money left after taxes, used for discretionary spending.

Income available for saving or spending after necessary expenses are paid.

A record of all transactions made in a checking account.

The interest rate paid on an investment for one year, factoring in compound interest.

The yearly interest rate charged on borrowed money.

Simple interest is calculated solely on the principal, while compound interest is calculated on the principal and accrued interest.

The value of what you give up when choosing one option over another.

A portion of a company's earnings distributed to shareholders.

Deductions that are not legally required, such as contributions to retirement accounts.

Mandatory deductions from pay such as taxes and Social Security.

Investment funds that pool money from many investors to purchase securities.

Companies that facilitate the buying and selling of securities.

Nonprofit financial institutions that provide savings accounts and loans at low interest rates.

Banks that offer a wide range of financial services including loans and investment options.