W!SE Test Review Flashcards

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Bounced check

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116 Terms

1

Bounced check

a check written for an amount more than in your account

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2

Cashier's Check

A check issued by a bank and sold to you for personal payments to people who won't accept a personal check. It certifies that you have the money available.

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3

credit union

A nonprofit financial institution that is owned by its members and organized for their benefit.

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4

Commercial Bank

a for-profit institution that offers a full range of financial services

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5

Money Order

A form of check payment on which the financial institution prints the exact amount covered. Often used by people who do not have a checking account.

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6

Reconcile

Make your bank records compatible with your bank statements.

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7

safe deposit box

a small, secure storage compartment that you can rent in a bank, usually for $100 a year or less.

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8

Brokerage

a firm that provides you access to the stock markets

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9

U.S. Savings Bond

Obtainable through the U.S. government. Purchased at one-half the face value and will mature to full face value over a specified period of time. FDIC insured, moderate liquidity, moderate rate of return.

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10

3 C's of Credit

Character(credit history), Capacity(ability to repay), Capital(assets)

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11

APR

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

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12

Chapter 7

The chapter of the Bankruptcy Code providing for "liquidation" (i.e., the sale of a debtor's nonexempt property and the distribution of the proceeds to creditors).

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13

chapter 11

Section of Bankruptcy law that allows businesses to reorganize, continue functioning and pay creditors equitably according to a court-approved plan

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14

Consumer Credit Counseling Services

a nonprofit organizatioin that provides debt counseling for individuals with serious debt problems

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15

collateral

something of value that a borrower lets the lender claim if a loan is not repaid

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16

FICO score

A credit rating developed by Fair Isaac & Company in the late 1950s, now widely used by lenders and employers. It consists of digit numbers ranging from 300-850.

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17

credit reporting agencies

equifax, transunion, and experian keep a record of consumer's credit transactions

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18

finance charge

is the total dollar amount you pay to use credit.

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19

default

failure to pay back a loan

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20

lien

the legal claim of one person upon the property of another person to secure the payment of a debt or the satisfaction of an obligation.

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21

payday loans

a loan where a borrower gets a cash advances based on his paycheck

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22

revolving credit

a type of open credit agreement that allows consumers to pay all or part of the outstanding balance on a loan or credit card.

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23

installment credit

a type of closed credit where the loan is repaid with interest in equal periodic payments. Example: car loan, mortgage

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24

truth in lending

Credit legislation that is federal they have to tell you the truth about their lending. Have to tell the whole truth in lending practices.

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25

Repossession

taking away property due to failure to repay the debt

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26

predatory lending

take advantage of ill-informed consumers through excessively high fees

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27

Principal

The money originally invested or loaned, on which basis interest and returns are calculated

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28

Collateralized Loan

A loan that is secured by collateral, properties or assets that are subject to seizure on default.

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29

Barter

exchange goods without involving money

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30

Garnishment

a legal process that allows part of your paycheck to be withheld for payment of a debt

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31

gross pay

the total amount you earn before any deductions are subtracted

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32

net pay

the amount of a paycheck after the deductions are taken out

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33

Inflation

a general increase in prices

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34

FICA

Federal Insurance Contributions Act; tax levied on both employers and employees to pay for Social Security and medicare

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35

Windfall Income

any type of additional income over expenses that is completely unexpected

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36

compound interest

interest earned on both the principal amount and any interest already earned

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37

simple interest

interest paid on the principal alone

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38

rule of 72

A quick way to figure out how long it will take to double your money at a given return rate . Interest rate divided by 72.

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39

time value of money

the principle that a dollar received today is worth more than a dollar received in the future

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40

scarcity

basic economic problem of economics that results from a combination of limited resources and unlimited wants

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41

Deductible

The amount an insured person must pay before the insurance company pays on a claim

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42

Beneficiary

n. person entitled to benefits or proceeds of an insurance policy or will

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43

Cash Value

the amount of money a whole life policyholder would receive if the policy were surrendered before death or maturity

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44

Claim

Formal request for payment, sent to the insurance company, to cover a loss

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45

Death Benefit

The actual amount paid to a beneficiary under a life insurance policy

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46

Disability Insurance

A type of insurance paid to an individual if he/she is injured and is unable to work for a specified length of time.

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47

Homeowners Insurance

coverage that provides protection for your residence and its associated financial risks

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48

Insurance

protection against financial loss

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49

Risk

The possibility of a financial loss

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50

Whole Insurance

a life insurance policy where the premium remains constant and builds a cash value invested by the insurer; a more expensive policy than term.

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51

Term Insurance

Life insurance coverage for a specified period of time, less expensive than whole

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52

Renters Insurance

a type of insurance that covers the loss of a tenant's personal property as a result of damage or theft

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53

Rider

an add-on to an insurance policy

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54

Floater

A policy designed to cover property that floats, or moves, from location to location.

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55

Bull Market

a period of rising stock prices

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56

Bear Market

a stock market with declining stock prices

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57

Bond

an IOU issued by a corporation or government that confirms you are lending the corporation or government money. Bonds pay interest regularly to lenders. At the end of the term of the bond, the borrower returns to the lender the face value of the bond (the amount the lender invested in the bond).

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58

Capital Gain

the profit from the sale of an asset such as stocks, bonds, or real estate.

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59

diversification

spreading out investments to reduce risks

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60

dividend

check paid to stockholders, usually quarterly, representing portion of corporate profits

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61

Dow Jones

The average price of 30 selected industrial stocks, used as a measure of general market trends

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62

liquidity

ease with which an asset can be converted into cash

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63

Mutual Fund

fund that pools the savings of many individuals and invests this money in a variety of stocks, bonds, and other financial assets

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64

NASDAQ

America's largest electronic stock market. Many technology stocks such as Apple, Microsoft and Yahoo are traded on this stock exchange

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65

S & P 500

tracks the prices of 500 different stocks as a measure of overall stock market performance

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66

Securities

all of the investments, including stocks, bonds, mutual funds, options, and commodities, that are traded

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67

Stock

Share of Ownership in a Corporation

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68

Treasury Bill

A government bond that is repaid within three months to a year.

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69

Treasury Note

a government bond that is repaid within two to ten years

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70

Return on Invesment (ROI)

ratio of money gained or earned on an investment

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71

Budget

a plan for making and spending money

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72

Deficit

the amount of money spent is more than the amount of money collected

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73

Emergency Fund

a savings account you can access quickly to pay for unexpected expenses or emergencies, usually equal to 3-6 months of your salary

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74

Fixed Expense

expenses which stay basically the same from month to month, such as housing and transportation.

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75

Opportunity Cost

What you give up when you make one choice over another

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76

Pay Yourself First

A GOLDEN RULE of personal finance. Put a portion of your paycheck into savings/investments before any other spending.

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77

Variable Expense

an expense that changes from month to month

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78

Need

something required or essential: food, shelter, transportation, education

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79

Want

an item that we desire but that is not essential to survival

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80

FDIC Federal Deposit Insurance Corp.

Insures your bank deposits up to $250,000

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81

IRS Internal Revenue Service

Federal Tax Collectors

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82

Federal Reserve Bank

Monetary Policy (how much $ should be in circulation)

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83

Banker's Bank

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84

SEC Securities and Exchange Commission

Makes and Enforces rules for the stock market

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85

US Mint

Make US coins

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86

US Bureau of Engraving and Printing

Make "paper" money

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87

Annual Deductible

yearly fixed amount or percentage of an insurance claim that is the responsibility of the insured, and which the insurance company will deduct from the claim payment

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88

Assigned Risk Pool

consists of people who are unable to obtain automobile insurance due to poor driving or accident records and must obtain coverage at high rates through a state program that requires insurance companies to accept some of them.

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89

Beneficiary

(n) one who benefits from something; a person who is left money or other property in a will or the like

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90

Benefit Period

period of time for which benefits are available.

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91

Claim

an established or recognized right

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92

comparison shopping

comparing products and prices in different stores before making a purchase

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93

co-pay

the amount of money the patient has to pay that the insurance company will not pay

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94

deductible

a clause in an insurance policy that relieves the insurer of responsibility to pay the initial loss up to a stated amount

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95

disability insurance

A form of health insurance that provides periodic payments to replace income when the insured is unable to work as a result of illness, injury, or disease-not as a result of a work-related accident or condition

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96

face value

Amount of principal due at the maturity date of the bond

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97

homeowners insurance

"A combination of both property and casualty coverages arising out of the ownership of a home. Coverage includes damage to the home, its contents, additional living expenses, and for the insured's personal liability. "

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98

insurance

promise of reimbursement in the case of loss

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99

comprehensive insurance

Damaged by anything other than a collision, insurance pays bill, covers theft, damage caused by fire, explosions, natural disasters, or riots.

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100

insurance benefit

Advantage, privilege, right, or financial reimbursement

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