PFIN Final

Goals

Goals

Things you hope to achieve in your life and work toward, getting a good job, completing your college degree, getting married, owning your own home, or running in a marathon,

Health

The condition of your body and mind. A person can be in good health or in bad health, both physically and emotionally.

Moderation

Not too much or too little of something; not going to an extreme in your pursuit of a goal.

Nutrition

Obtained from food and used by our bodies for growth and maintaining good health.

Opportunity Cost

What is lost by choosing one option instead of another. For example, choosing to take an afternoon nap might be a lost trip to the gym.

Sedentary

Lifestyle that involves a lot of sitting around and not enough physical activity.

Time Management

Organizing and using your time in a way that allows you to meet your daily needs as well as your short and long-term goals with as little stress as possible.

Values

What individuals or cultures think of as important in life, as having meaning, or as being desirable.

Abilities

Natural or acquired skills or talents.

Advancement

In terms of a career, an effort one makes (or a milestone one achieves) in bettering one's career.

Aptitude

An inherent ability or talent.

Cost of Living

The average cost of life's basic necessities, such as shelter, food, and clothing.

Cover Letter

A letter you send with your resume to provide more information about you.

Entry Level

Indicates a job accesible to a person who is inexperienced in a particular field.

Resume

A brief account of one's work experience and qualifications.

Salary

A fixed compensation paid regularly for services.

Skills

Proficiency acquired through training or experience.

Budget

An itemized summary of probable expenditures and income for a given period.

Fixed expense

An unchanging expenditure.

Flexible expense

An expenditure that varies.

Take-home pay

Money received after all adjustments and deductions are made.

Security Deposit

A sum of moeny usually equal to one month's rent, held by the landlord to cover any damage to the apartment caused by a tenant.

Tenant

The person renting the apartment.

Utilities

Items and services needed to make a house or apartment functional such as hot water, electricity, natural gas, phone service, and cable service.

Comparison Shopping

Looking for the same product in mutiple stores to find the best price, or to find the best product.

Warranty

The seller's promise to fix or replace the product if somthing goes wrong.

Collision Insurance

This covers the car of the insured person and pays for repairs after an accident or cash compensation if the car can't be repaired. This type of coverage is usually optional.

Lease

An agreement that gives one party the use of a commodity for a specified period of time and for a specified price.

Liability Insurance

This compensates an injured party up to a certain amount outlined in the policy statement. This type of insurance ensures you will be able to pay for any damages you cause.

Loan

An amount of money given to the borrower for a set period of time. After the set time has passed, the money must be paid back plus the lending fee,called interest. Payments are normally made over a series of months.

No-Fault Auto Insurance

A system under which drivers must have coverage for their own protection. It also limits the damages for which an injured party can sue. Under this system, after an accident both parties would be covered by their own insurance policies. Only some states use this system.

Check Register

The book in which you keep records of checks, deposits, debit card transactions, and atm withdrawals.

Debit Card

Like a credit card, but directly attached to a checking account, and can be used with a pin to pay for items at a store.

Overdrafts

Amounts withdrawn from your account beyond the money the account held.

Payday Loan

A loan where a borrower gets a cash advanced based on his paycheck. These loans generally must be repaid on the next day you are paid.

APR

The interest rate that the user of a credit card will pay.--This advertised by creditors varies and should be used to compare different credit card offers.

Credit

Making purchases now and paying for them later (also known as borrowing).

Creditor

Any bank or business that extends credit to others; a lender.

Debtor

Anyone who owes money; a borrower.

Interest Rate

The fee, expressed as a percentage, a borrower owes for the use of a creditor's money. At 10%, a borrower would pay $110 for $100 borrowed.

Introductory Rate

A temporary interest rate, advertised as a low APR to entice customers to apply for a credit card. After the ______________ period, the interest rate will increase to the regular APR.

Minimum Payment

The smallest required payment that a credit card holder can pay on a monthly bill and still remain in good standing with the lender.

Principal

The amount of money borrowed. On a credit card bill, the it is the purchase price of all items bought with the card.

Bankruptcy

When a debtors assets are sold to settle unpaid debts and the debtor is no longer responsiblle for further debt beyond what was recovered.

Credit History

A summary of a person's borrowing and repayment history.

Credit Report

A report on a person's creditworthiness that includes identifying information, credit cards, late payments, bankruptcies, and savings balances

Foreclosure

When a bank takes back a property and auctions it off to recover the unpaid loan amount.

Installment Loan

Loan with equal number of payments of the same amount over a fixed period of time.

Apprenticeship

A learning period of up to five years including on the job training (with pay) and additional coursework at night.

Associate's Degree

A degree that generally takes two years of study and is awarded by a community, junior, or business college.

Bachelor's Degree

An academic which usually takes four years to earn and is awarded by a college or university.

Community College

A two-year college that emphasizes career training, or a less expensive way to complete the first two years of college before transferring to a four-year college.

Grants & Scholarships

Money to pay for college that does not need to be paid back.

Internship

Time spent working for a company in an industry of interest. Can be paid or unpaid, and can last typically from six weeks to a year.

Student Loan

Money borrowed to pay for education. This money must be paid back. The best have deferred interest. That means interest does not start building until the education period is complete.

Fraud

When a criminal uses trickery to convince someone to give up valuable information or items of value.

Identity Theft

When a criminal opens a credit card with another persons name and social security number, charges merchandise, and leaves the victim with the unpaid bill. This can be multiplied as identities can be fraudulently sold, and others can continue to use someones good credit to get further credit cards and loans.

Online Banking

Using the Internet and a banks website to keep track of bank accounts, moving money from one account to another, and paying bills.

Phishing

When a criminal sends an e-mail using a scheme to get you to divulge your personal information. Contact your bank immediately if an e-mail says you will lose your account unless you provide your username and password or any other personal information. It is important not to reply to these emails.

Recurring Payments

Automatic payments a customer can set up, such as to pay for car insurance or cell phone service. These payments can happen every month, even though they are set up only once.

1040

The tax form most often used, in paper or online, for those with uncomplicated tax situations.

FICA

Taxes withheld for Social Security (benefits for older people, people with disabilities, and minor children and surviving spouses of deceased workers) and Medicare (pays for hospital insurance for those over 65).

Gross Income

The total amount of your income before you claim any exemptions or deductions

Standard Deduction

The amount of deduction given for those not claimed as a dependent on a parents taxes

Tax Audit

A review of a tax return by the IRS in which the taxpayer must show proof of all deductions, expenses, and income.

Tax Deduction

A donation or expense that reduces the taxable income amount.

Tax Refund

A check returning the taxpayers money to the taxpayer after tax retuns are filed and the over paid tax is determined.

W2

Report sent from the employer to both the IRS and the employee, showing gross income, total taxes paid, and total voluntary deductions.

W4

The withholding form each new employee fills out, stating the number of exemptions. the more exemptions listed, the less withholding tax will be taken from the paycheck.

Inflation

Rise in prices that effectively makes cash have less buying power.

Savings Account

A safe, low-return investment avalible from banks. There is generally no minimum deposit for this type of account, making it perfect for kids and teens just starting out.

Yield

For a savings account, the percentage of interest earned annually. For a stock, the annual dividend divided by the share price.

Adjustable Rate Mortgage

In this type of mortgage the interest rate can vary at certain points in the life of the mortgage. Usually the interest rate is tied to an index such as the U.S. Treasury bill rate; sometimes called a variable rate mortgage.

Closing Costs

These are additional costs paid by the borrower when buying or refinancing a home. For example, fees paid for a title search, an appraisal, a loan origination fee, title insurance, taxes, or the cost of a credit report.

Down Payment

A sum of money that you can pay at closing. The selling price of the home less the amount of this is the amount you will need to finance, or borrow.

Equity

The monetary value of your ownership. To determine your this in your home, subtract the amount you still owe on the home from its fair market value, or the price it would sell for.

Fixed Rate Mortgage

In this type of mortgage the interest rate remains the same throughout the life of the mortgage; it will not increase or decrease. Your payment due will be the same each month.

Mortgage

A legal document that uses property to secure a loan. Often the loan itself is referred to as a this.

Points

Equal to 1% of the amount of the loan. Sometimes by paying more of these at closing you can reduce the interest rate on your loan.

Dividend

Money paid by a corporation to each shareholder. Typically given four times a year, these distributions of company profits can be used to reinvest in more shares of the company.

Common Stock

A share in a company's assets and profits. The ownership of a publicly traded company is split up into the shares being traded and held.

Money Market

A mutual fund or account that invests in short-term, liquid investments. These funds generally pay better than a savings account with a bank, but less than a typical stock mutual fund. These funds are considered very low risk.

Mutual Fund

A pool of stocks, bonds, and other securities managed by an investment company. Individuals can buy shares of the fund and profit from its investment gains.

Rate of Return

The annual amount of money an investment makes, given as a percentage.

Risk

The chance that an investment may lose value. Less _____ investments have a lower rate of return.

Return

Monetary increase that an investment makes. If an investment loses value, it is called a negative __________.

Bonds

Money loaned to the government corporations, or municipalities that pays the investor interest. Different types can be more or less risky, and they can have high yields or low yields (interest rates).

Diversification

Owning a collection of investments such as stocks from different industries and small and large companies, bonds, and money market funds for cash, in order to spread risk and have a safer investment overall.

Investment Portfolio

The collection of investments you personally hold, including stocks, bonds, money market accounts, and savings account.

401(k) plan

A type of employer-sponsored retirement plan in which money is contributed on a pre-tax basis and all earnings are tax deferred.

Annuity

An investment contract made with the issuer (e.g., insurance company); types: immediate, deferred, fixed, variable.

IRA

A type of retirement-savings plan that is not usually done through an employer; traditonal IRAs are tax deductible and earnings are tax deferred.

Automobile Insurance

A type of insurance that covers property damage or legal liabilities in the event of an auto accident, or property damage in the event of theft.

Beneficiary

The individual or group of individuals named to recieve the benefit of a life insurance policy.

Deductible

The amount of the loss you pay when you file an insurance claim.

Dependents

The persons who depend on someone for their livelihood. Most often these are minor children and the spouse but can be adult siblings, adult children, and elderly parents.

Disability Insurance

A type of insurance that replaces the income of the insured individual if he or she cannot work due to injury or illness.

Health Insurance

A type of insurance that covers the cost of both planned and unexpected medical services.

Premium

The cost of an insurance policy.

Term Life Insurance

A type of life insurance that pays a benefit only when a person dies during the time period of the policy.