personal finance

final quiz

community/ junior college

institution of higher learning which offers associate degrees; often government-supported and less expensive than universities and colleges

university

institution of higher learning which offers teaching and research facilities and awards a variety of bachelor's degrees, master's degrees and doctorates

associate degree

requires 60 hours of coursework, usually taking two years to complete; vary based on school and subject area

college

institution of higher learning which offers bachelor's degrees in liberal arts, science or both

technical school

institution of higher learning which offers training for specific careers, such as welding, culinary arts, plumbing, medical assisting, cosmetology, etc.; sometimes provide students with licensure, certification or associate degrees; also known as vocational college or trade school

long-term goals

goals set to be achieved in about 10 or more years

money personalities

categories in which people can be put based off of their spending and saving habits

short-term goals

goals set to be achieved in less than a year of time

intermediate-term goals

goals set to be achieved in about five to 10 years

saver

individual who likes to save money rather than spend money

risk taker

individual who enjoys investing money into high-risk ventures

spender

individual who enjoys spending money on himself/herself or others

security seeker

individual who plans for the future and is prepared for any type of financial situations

gross wage

amount an individual makes prior to any deductions

net pay

total amount an employee is paid after all deductions

withholdings

amount of an individual's wages which are not included in a paycheck

paycheck stub

document provided to employees every pay period detailing their earnings

credit card

provides a line of credit from a lending institution which can be accessed with a card, has a maximum limit (credit limit) which can be spent and requires monthly repayments

lien

right to keep possession of property of another until a debt owed by the person is discharged

debit card

draws money directly from the consumer's checking account when a purchase is made

unsecured credit

loan which is issued and supported by a borrower's reliability, rather than value of an asset

loan consolidation

process of combining multiple loan payments into one

interest rates

percentage of the loan which must be paid back in addition to the amount a student borrows

repayment plans

plans created to help students pay off their loans over a period of time

federal-work studies

federal part-time jobs for students who go to college and possess financial need

student grants

amount of money rewarded to students based on certain financial need criteria

student loans

money borrowed by students to help pay for their education

FAFSA

Free Application for Federal Student Aid; allows students to apply for financial aid from a variety of sources

scholarships

amount of money rewarded to students based on merit

budgets

assist in planning financial situations throughout the year; acts as a control mechanism in regards to the way money is spent; assist in reorganizing finances to reduce debt or increase savings

checking accounts

allow users to withdraw and deposit money at anytime, used for daily expenses; usually free

family life cycle

explains how a person changes financial position, earnings, consumption and savings throughout the life cycle

goals

focal point of developing a personal financial plan; need to have a set of priorities and a target date for achievement; require constant updating as a result of the changing family life cycle

promissory note

written promise to repay any sum of money which was borrowed

EFC

Expected Family Contribution; set amount of money an institution feels a student's family could contribute to their education

COA

Cost of Attendance; amount of money a student will have to pay in order to attend the college or career school of their choice

assets

property and possessions belonging to a person which could be subject to the payment of debts

post-secondary education

education past the high school or GED level

private universities

schools considered to be educational nonprofit organizations, receiving the majority of their funding through tuition, donations and endowments

GED

test designed to provide credentials equivalent to a high school diploma

public universities

colleges or universities which are mainly funded by state government

401k Plans

employer-sponsored benefit plans which provide individuals with the chance to put a portion of their earnings in a financial portfolio; contributions are exempt from income tax and can be rolled over into an IRA or future

Certificates of Deposit (CDs)

similar to savings accounts but has higher interest rates, fixed terms and a fixed interest rate

Individual Retirement Accounts (IRAs)

allow individuals to open an account and begin saving funds toward retirement with tax benefits; can be traditional or Roth

stocks

investment in publicly traded companies; provides ownership in a company; can be common or preferred

savings accounts

earn interest over time, but have limited number of transfers and withdraws allowed

brokerage firms

assist individuals in buying and selling securities among investors

premium

amount paid for an insurance policy

insurance companies

provide financial coverage to protect individuals or organizations against possible adverse events in exchange for premium payments

mortgage company

provides loans for prospective home buyers

investment banks and companies

private organizations which hold and manage securities for investment purposes

securities

financial instruments with ownership rights, debt rights, or rights to buy, sell or trade, such as stocks and bonds

savings and loan associations

handle deposit accounts, personal loans and mortgage lending

non-depository financial institutions

do not offer federally insured deposit accounts

undergraduate degree

first level of post-secondary education degrees which consist of associate and bachelor's degrees

graduate degree

degrees which are attainable after the student has earned their undergraduate degree

vocational/trade school

short-term schools which tend to focus on specific topics or careers

community college

two-year colleges which award associate degrees and allow the students the option to transfer into private or public universities

spending wants

expenses which help an individual to live more comfortably

spending needs

expenditures which are essential for an individual to be live and function

flyer

individual who does not consider money as a necessity and does not have much of an opinion on money

beneficiary

individual who holds legal control of the assets in a trust account

electronic funds transfer

electronic movement of money from one account to another

automated teller machine

electronic banking terminal which allows customers to complete basic transactions, such as deposits or withdrawals

direct deposits

allows individuals to have their paycheck or other payments deposited directly into their account

compensation

systematic method for providing monetary and non-monetary value to employees in exchange for services provided to the organization

commission

sum of money paid to an employee upon the completion of a task

wages

compensation paid to working employees

salary

income paid to an employee in fixed regular intervals

selective comprehension

consumers interpret information so that it is consistent with their beliefs and values

selective attention

consumers decide how much attention they would like to give to a message

selective exposure

consumers actively choose messages which they want to see

perception

process in which an individual creates personal experience by selecting, organizing and interpreting information available to him or her

revolving credit

maximum amount being loaned to the borrower by the creditor

installment credit

determines a series of fixed or installment payments a borrower must repay over a determined period of time

payday loan

short-term, high cost loan typically for $500 or less and due on the next payday or when income is received

collateral

valuable asset the borrower offers to lender for securement of the loan provided

economy

state of wealth, resources and employment in a country or region; has a lot of influence on the job market and workforce

recession

period of reduced economic activity; affects the job market and unemployment

white-collar career

relates to working in an office setting

stereotype

oversimplified or biased mental picture which characterizes a person or group of people

blue-collar career

relates to labor and working with your hands

morale

mental and emotional well-being of a person or group

socioeconomic status

measure of position based on social and economic factors including education, income, occupation and wealth

employability

level to which someone is likely to gain employment and be successful in a career

initiative

ability or instinct to act or take charge independently

employability skills

skills needed to be effective in any job market and workplace

lifestyle

way or condition in which a person lives; reflect a person's values, morals, culture and financial situation

variable interest

interest rate which fluctuates overtime as market rates change

annual percentage rate

annual or yearly rate charged for borrowing or earned through an investment

loan amortization

process which involves paying off a debt with a fixed payment plan over a specific period of time

fixed interest

interest rate which stays the same throughout the loan

principal payment

money which is agreed to be paid back and only goes towards the principal of the loan

pay-by-phone system

allows customers to pay bills or transfer money between accounts over the phone

overdraft protection

line of credit issued to customers to cover checks or debits exceeding the amount in their account

online banking

electronic banking systems allowing customers to conduct financial transactions via the Internet

electronic checks

form on online payment where money is electronically withdrawn from the customer's account

tuition and fees

cost of a student's education

room and board

cost of a student's living accommodations and meal plan

academic reputation

overall beliefs and opinions about a school based upon various qualities and attributes