UNIT 2: Earning & Keeping Money | College, Career, & Taxes

Award Letter

Notification of a financial aid award that lists the types and amounts of financial aid for which the student is eligible.

Consumer

A person or organization that purchases a product or service.

Cost of Attendance

Total cost to attend school, including tuition, fees, room, board, and personal expenses.

Effective Tax Rate

The actual rate paid on taxes as a percentage of overall income.

FAFSA

Free Application for Federal Student Aid.

FICA taxes

Tax withheld from paychecks for Social Security and Medicare, matched by employers.

Financial Aid

Financial assistance for college or post-secondary education, such as scholarships, grants, fee waivers, and loans.

Grants

Financial aid that does not need to be paid back, usually based on need.

Gross Pay

Total amount of an employee's earnings before deductions.

I-9 Form

Employment eligibility verification form for identity and employment authorization.

Marginal Tax Rate

Tax rate that applies to the next dollar of taxable income within a progressive tax system.

Net Pay (Take Home Pay)

Income remaining after taxes and deductions have been taken out.

Parent Plus Loan

Federal college loan borrowed and repaid by a parent on behalf of a dependent student.

Paycheck Deductions (Voluntary)

Money withheld from a paycheck before tax for employer-provided programs.

Paycheck Withholding (Required)

Money taken out of a paycheck for taxes, such as Social Security and Medicare.

Private Student Loans

Loans financed by private companies that cost more than federal loans.

Progressive Tax System

A tax system where the average tax rate increases as income increases.

Room and Board

Cost of housing and food while attending college or career school.

Scholarships

Financial aid awarded for merit or talent that does not need to be paid back.

Subsidized Student Loan (Federal)

Need-based federal loan where the government pays interest while the borrower is in school.

Tax Bracket

A range of income on which a given marginal tax rate is applied.

Tuition

Amount charged for teaching or instruction by an educational institution.

Unsubsidized Student Loan (Federal)

Federal student loan where the government does not pay the accruing interest.

W-2 Tax Form

Form reporting earnings and taxes withheld for the year.

W-4 Tax Form

Form completed to determine the amount to withhold from a paycheck for taxes.

Work Study

Federal financial aid program allowing students to work part-time while studying.

YTD (on a paystub)

Year-to-date; amount earned or paid in the year thus far.