Banking and Personal Finance Concepts

Flashcards covering key terms and concepts related to banking and personal finance, including various types of bankruptcy, consumer protections, and financial terminology.

Chapter 7 Bankruptcy

Type of bankruptcy where most debts can be discharged, but not child support, student loans, or recent tax debts.

Chapter 13 Bankruptcy

Bankruptcy that allows borrowers to keep certain assets while reorganizing their debts.

ECOA (Equal Credit Opportunity Act)

Federal law that prohibits discrimination in lending based on race, among other factors.

CARD Act

Legislation requiring credit card companies to provide advance notice before changing terms like interest rates or fees.

Credit Utilization Ratio

Measure indicating the extent to which consumers are using their available credit, which can affect credit scores.

Credit Bureau

Organization that collects and provides consumer credit information; major examples include Experian.

Credit Card Grace Period

Time frame during which a borrower can pay off their credit card balance without incurring interest charges.

Hard Inquiries

Credit report checks by lenders that can lower credit scores if done frequently within a short time frame.

Compounding Interest

Interest that is calculated on the initial principal and also on the accumulated interest from previous periods.

APR (Annual Percentage Rate)

The annual rate charged for borrowing or earned through an investment, including fees.

APY (Annual Percentage Yield)

Annual rate of return taking into account the effect of compounding interest.

Stop Payment Order

Request to a bank to cancel a payment that was previously authorized.

Truth in Savings Act

Law requiring disclosure of interest rates and fees related to savings accounts.

FDIC Insurance

Federal insurance that protects depositors up to $250,000 per depositor per bank.

Gross Income

Total income received by an individual before taxes and deductions, includes bonuses but not gifts.

Tax Deduction for Students

Expenses such as student loan interest that may reduce taxable income.

Utility in Economics

Satisfaction or benefit derived from consuming a product or service.

SMART Goals

Goals that are Specific, Measurable, Achievable, Relevant, and Time-bound.

Personal Balance Sheet

A financial statement that summarizes an individual's assets, liabilities, and equity at a given point in time.

Income Statement

Summarizes income and expenses over a period, showing profitability.