Missouri State University Final

interest

income received from a savings account

career path

something that you should evaluate your skills, interests, and abilities before determining it

disposable income

the portion of your salary you have left after paying for things like health insurance for you and your dependents (health insurance can cost well over $500 per MONTH)

budget

a helpful tool to use when prioritizing financial goals

opportunity cost

refers to that which is given up when a certain course of action is taken

save and invest EARLY

the most important action a person can take to accumulate wealth

inflation

the biggest risk to a person who only saves their money in a bank savings account

liability auto insurance

required by law to be purchased by drivers in Missouri and many other states

outflows

an appropriate thing to include in a budget when related to investing

certificate of deposit

a type of time deposit account

Internal Revenue Service

an organization that is NOT a part of the Federal Reserve and is NOT one of the tools available to control the money supply

saving and investing

the alternative to spending money

debit card - credit card

a debit card uses your own funds, a credit card is borrowing funds from a bank

annual fee

a yearly fee that most credit card-issuing banks DO NOT charge for having an account

revolving credit

an account that allows you to make new charges while still paying off older ones - credit cards are best described as this

stable income

an income status that would make a person likely to receive a lower interest rate on a personal line of credit

payment history

something that is likely to be found on a credit report

identity theft coverage

a type of insurance you can obtain to cover losses associated with being a victim of identity theft

Consumer Financial Protection Bureau

the best resource for someone who is the victim of identity theft

savings account

this has the lowest potential investment return over a long time horizon

investing

something that typically earns a higher rate of return than saving

diversification

the concept that you should not invest all your money in only one or two investment options

municipal bond

an investment that is generally considered to be "tax-free"

compound interest

a type of interest that pays more than simple interest

passive investing strategies

considering the long-term and fees, a type of investing that tends to outperform active investing strategies