Financial Literacy Review

This set of flashcards covers essential vocabulary and concepts related to financial literacy, including budgeting, saving, taxes, investing, and consumer awareness.

Percent

A portion of the total, represented as a fraction of 100.

Base Value

The numerical value to which a part is compared.

Discount

A reduction in price or amount.

Seasonal Discount

A discount offered during a specific time of year.

Trade Discount

A discount offered to businesses in the same trade.

Cash Discount

A discount offered for early payment.

Simple Interest

Interest calculated only on the principal amount.

Compound Interest

Interest calculated on the principal and accumulated interest.

Checking Account

An account for managing funds, paying bills, and making transactions.

Overdraft Protection

A service that covers transactions when there aren't enough funds.

Financial Liquidity

The ease of converting an asset into cash.

Tax Deduction

An expense subtracted from gross income to reduce taxable income.

Tax Exemption

A fixed amount that can be deducted to reduce taxable income.

FICA Taxes

Taxes that fund Social Security and Medicare.

Investment Liquidity

The ease of converting an investment into cash.

Bonds

Debt instruments issued by corporations or governments that pay interest.

Financial Risk

The potential for financial loss associated with a specific investment.

Financial Portfolio

A collection of investments held by an individual or organization.

Identity Theft

The fraudulent acquisition and use of a person's personal information.

Credit Card Fraud

The unauthorized use of a credit card.

Opportunity Cost

The value of the next best alternative that is forgone.

Budget

A plan for managing income and expenses.

Consumer Rights

Rights designed to protect consumers in the marketplace.

Insured Savings Accounts

Savings accounts protected by insurance, like FDIC.

Ratio

A comparison of two quantities.

Impulse Buying

Purchasing items on a whim without forethought.

Tax Holiday

A temporary suspension or reduction of certain taxes.

Real Estate Investment

Property acquired for generating rental income and property appreciation.

Margin of Safety

A principle of investing that focuses on risk management and analysis.

Direct Deposit

An electronic transfer of payment directly into a bank account.

Maslow’s Hierarchy of Needs

A motivational theory that prioritizes needs and wants.

Liability Insurance

Insurance protecting against financial losses from legal claims.

Discretionary Income

Income available after necessary expenses are paid.

Consumer Awareness

Understanding consumer rights and responsibilities in the marketplace.

Creditworthiness

An assessment of a borrower's ability to repay a loan.

A APR (Annual Percentage Rate)

The annual rate charged for borrowing, expressed as a percentage.

Beneficiary

A person designated to receive benefits from an insurance policy.

Insurance Premium

The amount paid for insurance coverage.

Loan-to-Value Ratio

A financial term used by lenders to express the ratio of a loan to the value of an asset.

Financial Planning

Setting future financial goals and managing funds to achieve them.

Economic Indicator

Statistics that provide information about economic performance.

Variable Expense

Costs that fluctuate based on consumption or usage.

Fixed Expense

Costs that remain constant regardless of consumption.

Investment Diversification

The practice of spreading investments across various assets to reduce risk.

Life Insurance

Insurance that provides financial protection to beneficiaries upon the death of the insured.

Annuity

A financial product that pays out income and is often used as part of a retirement strategy.

Debt-to-Income Ratio

A measure of an individual's monthly debt payments compared to their gross monthly income.

Consumer Reports

Publications that provide reviews and comparisons of consumer products.