Financial Vocabulary I & II - 9th Grade

Annual Fee

An amount that credit card companies can charge for the use of a credit card.

Annual Percentage Rate (APR)

Is the total amount of what costs you to use credit in a given year, It is expressed as a percentage of the amount borrowed.

Automated Teller Machine (ATM):

An electronic machine that bank customers and credit union members can use to withdraw cash and make other financial transactions.

Bank

A for-profit company that is owned by its stockholders and provides savings and checking accounts and other financial services to its customers.

Bankruptcy

A legal process to get out of debt when you can no longer make all your required payments.

Bond

A formal agreement where you (the ____ holder) will lend money to a borrower who can then use that money for a set period of time. In exchange, you, as the lender, will get paid a specific amount of interest.

Budget

A spending plan for managing money during a given period of time.

Capital Gain

The difference between the purchase price and the selling price when an investor buys a stock and sells it later at a higher price.

Capital Loss

This is the difference when an investor ends up selling a stock at a lower price than the purchase price.

Career

An occupation that is your chosen field and that provides you with income, an activity, challenges, opportunities for advancement, and satisfaction.

Cash Flow

Movement of the money you receive and the money you spend.

Chapter 7

A form of bankruptcy that allows you to erase most of your debt.

Chapter 13

A form of bankruptcy that allows you to repay many of your debts over a period of time, usually no more than five years.

Checking Account

A bank or credit union account that allows withdrawals by writing a check.

Compounding or Compound Interest

Earning interest on interest.

Coverage Limit

The maximum amount an insurance company will pay if you file a claim.

Credit

An amount of money, or something of value, that is loaned on trust and with the expectation that it will be repaid at a later date.

Credit History

A record of how you have repaid your credit obligations.

Credit Limit

This is the maximum amount of credit a lender will extend to a customer.

Credit Report

A detailed record of your personal credit and financial transactions.

Credit Score

A rating used by credit reporting companies to help lenders decide whether and/or how much credit can be extended to a borrower.

Credit Union

A financial institution owned by its members that provides savings and checking accounts and other services to its membership at low fees.

Debit Card

A card that is used to deduct a purchase amount directly from your checking account instead of drawing on a line of credit; also called 'check card.'

Debt

The entire amount of money you owe to lenders.

Deductible

The amount of a loss you must pay out of your own pocket before the insurance company will step in and pay the rest.

Delayed Gratification

''The willingness to give up something you want now in order to get something better in the future.

Diversification

Reducing investment risk by putting money in several different types of investments.

Dividend

The portion of the profits paid to the shareholders of a company.

Dollar Cost Averaging

The practice of investing a fixed amount into the same investment at regular intervals, regardless of what the stock market is doing.

Earned Interest

The payment you receive for allowing a financial institution or corporation to use your money.

Electronic Funds Transfer (EFT)

A way to give permission to pay bills and have paychecks deposited directly into your account via electronic terminal, automated teller machine, computer, or telephone.

Endorse

To sign the back of a check to make it payable to the specified payee.

Entrepreneur

A person who starts his or her own business based on the belief that he or she can make a better product or provide a better service than what existing companies provide.

Expense

An amount of money spent to buy something or do something.

Federal Income Tax

A payroll deduction collected by employers by law and sent to the federal government to support governmental programs.

Finance Charge

Usually seen on credit card statements ????????????