Exam

Gross Income

the total amount of income from wages before any payroll deductions

Disposable (Net) Income

The amount of income left to an individual after taxes have been paid, that is available for spending and saving. It is income that can be saved or spent on goods and services wanted, not needed.

Essential Expenses

expenses that we incur that we have to pay to live, such as the power bill, water bill, food, medicine

discretionary expenses

Any expenses that are not considered essential to the household or business. Examples include movie tickets, eating out, expensive clothes, and video games.

Mean

average

Median

Middle number

Mode

most frequently occurring score

range

the difference between the highest and lowest scores in a distribution

Percentile

A ratio that compares a number to 100

Dispersion

the pattern of spacing among individuals within the boundaries of the population

normal distribution

a bell-shaped curve, describing the spread of a characteristic throughout a population

checking account

An account at a bank that allows a customer to deposit money, make withdrawals, and make transfers from the funds on deposit using a paper check or electronic transfer.

Check

A written order used to tell a bank to pay money (transfer funds) from an account to the check holder.

Payee

The receiver of funds.

Direct deposit

Payroll or other types of check that are directly and electronically deposited into a bank account.

Debit card

a card issued by a bank allowing the holder to transfer money electronically to another bank account when making a purchase.

ATM

A machine that allows individuals to complete certain transactions from the machine without human assistance.

PIN

A numerical password that allows access to an ATM.

Hold

The money in a bank account that is not released until the issuing bank of a check pays for the check.

Endorse

The act of signing the back of a check when cashing it.

Canceled

A check that has been processed so that the money is paid to the payee of a check.

Insufficient Funds

When an account does not have enough money to cover a check that has been issued against it.

Overdraft Protection

This protections pays a check even though there are not enough funds in the account; There is a fee for this service and the money must be repaid.

Maintenance fee

A fee that some banks charge to provide access to checking or savings accounts.

Interest

A percentage of the money that is an account that a bank pays on some accounts.

Single Account

An account that has just one owner who is able to make account transactions.

Joint Account

An account with more than one owner; all the owners have equal access.

Starting Balance

The amount of money in a checking account at the beginning of a statement period.

Ending Balance

The amount of money in a checking account at the end of a statement period.

Outstanding deposits

Deposits that not appear on the bank statement.

Outstanding checks

checks that have not been deducted from the bank statement balance.

Reconciling

The process of verifying the bank's records to make sure no errors have been made

savings account

An account at a depository institution that is designed to hold money not spent on current consumption

Interest rate

Percentage of amount borrowed to be added to the amount loaned and paid back

Principal

The amount of money borrowed

Minimum Balance

the lowest amount that can be kept in a checking account before you have to pay a fee

APR

Annual percentage rate; the annual rate of interest that is charged for using credit

Compound interest

Interest paid on interest previously earned; credited daily, monthly, quarterly or semiannually

APY

Annual Percentage Yield; describes interest paid to a saving account or certificate

Credit

the ability of a customer to obtain goods or services before payment, based on the trust that payment will be made in the future.

Debtor

A person who owes money

Creditor

A person to whom money is owed

Asset

Anything of value that is owned

Credit rating

an estimate of the ability of a person or organization to fulfill their financial commitments, based on previous dealings.

FICO score

Credit score from 300-850 that rates how likely a person is to fall 90 days behind in a payment.

Installment plan

A payment plan that allows customers to make payments at set intervals over a period of time until the total debt is paid

Cosigner

Someone who promises to pay if the borrower fails to pay

Wage garnishment

An involuntary form of wage assignment, often done by court order.

Balloon payment

a final loan payment that is much larger than the regular monthly payments

FASFA

Free Application for Federal Student Aid; determines how much financial aid a student may receive.

Federal loan

Money given to students from the federal government that needs to be repaid.

Private loan

Money borrowed from a private financial institution, such as a bank.

Monthly payment

This is the payment that the mortgagee or borrower will be required to pay each month until the loan has been paid off completely according to the terms agreed upon between the borrower and lender.

Credit card

A plastic card used to make purchases now and pay for them later.

Impulse buying

purchasing items on the spur of the moment

Billing cycle

time period during which you must make your monthly payment

Credit card statement

A detailed list of transactions, fees, payments, and balance figures for a credit card

Credit line

The maximum dollar amount that can be charged on a specific credit card account.

Available credit

the preset amount of credit available on a credit card

Previous balance

Amount still owed from purchases prior to the current 30-day charge cycle.

Finance charge

the total dollar amount of all interest and fees you pay for the use of credit

Late charge

The penalty for late payments from a previous month.

Minimum payment

The smallest required payment that a credit card holder can pay on a monthly bill

Average daily balance

The average amount owed per day during the billing cycle.

Credit calendar

A calendar method of finding the average daily balance of a credit card.

Kelly Blue Book

a reference book listing the prices of used cars

Liable

legally responsible

Negligent

not properly attentive

Automobile insurance

Provides payments for both liability and property insurance on a vehicle

Premium

Amount you pay monthly, quarterly, semiannually or annually to purchase different types of insurance

Claim

when a report is filed with an insurance company so that the insured party may be compensated for the damages

Liability Insurance

insurance that provides protection from claims arising from injuries or damage to other people or property

Deductible

Amount you must pay before you begin receiving any benefits from your insurance company

Depreciation

A decrease or loss in value