Help
Options
Didn't know it?
click below
click below
Knew it?
click below
click below
Don't Know
Remaining cards (0)
Know
retry
shuffle
restart
0:00
Embed Code - If you would like this activity on your web page, copy the script below and paste it into your web page.
Normal Size Small Size show me how
Normal Size Small Size show me how
Sem 2 Final Review
Intro to Business/Consumer Vocabulary
| Term | Definition |
|---|---|
| 1040 | The standard Internal Revenue Service (IRS) form that individuals can use to file their annual income tax returns |
| 1099 | A form that details all "non-employee" compensation, including for specific jobs like freelancers or contractors |
| 28-36 Rule | A guideline that a person should spend at most 28% of their gross income on their housing costs and 36% of their gross income on total debt payments. |
| 50-20-30 Rule | A popular savings rule of thumb in which 50% of your income goes towards necessities, 20% goes towards saving and debt repayment, and 30% goes towards flexible spending |
| 50/30/20 Budget | A budgeting method that allocates 50% to needs, 30% to wants, and 20% to savings and debt repayment |
| Amortization | The paying off of debt over time in equal installments; part of each payment goes toward the loan principal while the other part goes toward interest |
| Annual Fee | A yearly fee that may be charged for having a specific credit card, independent of how you use the card |
| Annual Percentage Rate (APR) | The cost you pay each year to borrow money, including fees, expressed as a percentage |
| Asset | A valuable resource that is owned by a person, company, or government in order to get an economic benefit. |
| Asset Allocation | Dividing an investment portfolio among different asset categories, such as stocks, bonds, and cash |
| ATM | Automatic Teller Machine. Allows a person to manage a bank account holder's funds through actions such as withdrawing or depositing money, viewing account balances, etc. |
| Audit | An inspection of a filer's tax return by the IRS |
| Auto Lease | An agreement where an individual makes monthly payments to use a car for a certain length of time instead of purchasing the car |
| Bank Statement | A monthly document prepared by your financial institution which shows all of the transactions related to your account |
| Bankruptcy | A legal proceeding carried out to allow individuals or businesses freedom from their debts, while simultaneously providing creditors an opportunity for repayment |
| Bear Market | A market in which prices are falling, encouraging selling. |
| Benefits (ie. Job Benefits) | The extras an employer provides employees in addition to pay, such as health insurance or paid time off |
| Bond | A security in which the investor loans money to a company or government, which then pays regular interest to the bondholder and returns the principal on the bond's maturity date |
| Bond Rating | A measurement of the likelihood that a bondholder will be paid back |
| Brokerage Account | An account that lets individual investors trade stocks, bonds, mutual funds, and other investments |
| Budget | A plan of your expected income and how you will use it to meet your expected expenses over a period of time |
| Bull Market | A market in which there is increased stock trading and rising stock prices |
| Buyer’s Agent | A type of real estate agent who works for the buyer. They help buyers find and purchase properties that meet their specific needs and budget. |
| Canceled Check | A check that has been paid or cleared by the bank. It will appear on your bank statement |
| Capital Gain | Profit from the sale of an asset, such as a stock or a bond, calculated by subtracting the price you initially paid from the price you then sold it for |
| Capital Gains Tax | A tax levied on profit from the sale of property or an investment |
| Certificate Of Deposit (CD) | A bank product that earns interest on a lump-sum deposit that's untouched for a predetermined period of time |
| Certified Pre-owned Car | A used car that has been inspected, refurbished, certified and warranted by the original manufacturer |
| Check | A written, dated, and signed order to the bank that tells it to pay a definite sum of money to a payee |
| Check Register | A record that allows you to keep track of checks you have written, ATM/debit card transactions, as well as deposits and withdrawals |
| Checkbook | A handy portfolio that holds your check register, checks, deposit slips, receipts, and other records of ATM/debit card transactions |
| Claim | A formal request from the customer to an insurance company asking for a payment based on the terms of the insurance policy |
| Closing Costs | Fees you pay your lender at the time you buy a house. These costs can include fees for appraisal, title insurance, and inspections. |
| Collateral | Something valuable that the lender can take as payment if you can't or don't repay your secured loan |
| Collections | An attempted recovery of a past-due credit obligation or debt by a collection department or agency |
| Collision Coverage | Auto insurance that protects you against costs to repair your own vehicle after a crash |
| Compound Interest | Reinvesting earned interest back into the principal to allow money to grow exponentially over time |
| Comprehensive Coverage | Auto insurance that protects you against costs to repair or replace your vehicle after events out of your control such as weather, vandalism, theft, etc. |
| Contingency | A condition that must be met before a sale is finalized. |
| Copay | A fixed dollar amount that you agree to pay each time you receive medical treatment, such as a doctor's visit or prescription |
| Corporate Income Tax | A percentage of profits paid by a business to the federal and state government |
| Cosigner | Someone who legally agrees to take responsibility for a person's debt if they cannot repay it |
| Cost of Living | The amount of money needed to sustain a certain level of living, including basic expenses such as housing, food, taxes, and healthcare; often used when comparing how expensive it is to live in one city versus another |
| Counteroffer | A response to an offer that suggests specific changes. |
| Coverage Limit | The maximum amount an insurance company will pay if you file a claim |
| Credit | An agreement in which a borrower receives something of value now and agrees to repay the lender in the future, generally with interest |
| Credit Bureau | A consumer-reporting company that collects and sells information about how individual people manage their credit (e.g. Equifax) |
| Credit Card | A plastic card that allows you to make purchases now with borrowed money, which then you must repay to the lender in one lump sum or in monthly payments with interest |
| Credit Card Agreement | A legal document that outlines the terms and conditions for using your credit card |
| Credit Discrimination | When a lender allows protected traits, such as race or sexual orientation, to influence its decision to offer someone credit or a loan |
| Credit History | A record of a person's use of credit over time; 15% of your credit score is based on the length of your credit history |
| Credit Limit | The maximum amount that may be borrowed on a credit card |
| Credit Report | A document with information about a person’s credit activity and history |
| Credit Score | A three-digit number (ranging from 300-850) based on an individual's credit history detailed in a credit report |
| Credit Union | A nonprofit financial institution that is owned by its members and organized for their benefit |
| Debit | A sum of money deducted FROM your account |
| Debit Card | A card that is directly connected to your checking account; it enables you to conduct ATM transactions and to make purchases instead of using cash or writing a check |
| Debt | Something, typically money, that you owe to a person or a business |
| Declaration Page | The page of a car insurance policy which includes a summary description of the insurance coverage provided and gives the maximum dollar limit the insurer will pay for a claim under each coverage |
| Deductible | The amount of money you agree to pay towards your losses before your insurance coverage will begin paying |
| Deduction | Any items subtracted from your paycheck, including state and federal income taxes, Social Security, health insurance or 401(k) contributions |
| Deficit | When your expenses exceed your income |
| Demand-Pull Inflation | Inflation caused by an increase in demand, but supply is the same |
| Dependent | Someone you financially support who can be "claimed" on a tax return to reduce your taxable income and lower your taxes |
| Deposit | Money you put into your account |
| Depreciation | A decrease or loss in value |
| Direct Deposit | An automatic electronic deposit of net pay to an employee's designated bank account |
| Disability Insurance | A type of insurance paid to an individual if they are injured and unable to work for a specified length of time |
| Discretionary Spending | Spending by the federal government determined by legislative action and approved through votes by elected officials |
| Diversification | The practice of investing in a large variety of stocks, bonds, and/or funds as a way to reduce your overall risk |
| Dividend | Money from the profits of a company that is paid out to its shareholders, typically on a quarterly basis |
| Down Payment | A partial payment made in cash at the beginning of the purchase of a good or service, while the remaining balance is due later or is financed as part of a loan |
| Earned Income | Any income (wages/salary) that is generated by working |
| Effective Tax Rate | The actual rate you pay on your taxes, as a percentage of your overall income |
| Emergency Fund | Money set aside for unanticipated expenses or loss of income |
| Endorse | To sign the back of a check made out to you so it can be cashed or deposited |
| Equal Credit Opportunity Act | A law that protects consumers from discrimination in the granting or denying of credit |
| Escrow | An agreement where a third party holds assets (eg. money) during a transaction. For example, a buyer may put a deposit in escrow when buying a house. |
| Excise Tax | A tax paid on purchases of a specific good, like gasoline or cigarettes |
| Exemption | The set amount of money, per dependent, you can subtract from your taxable income |
| Expenses | Items or services you pay for such as rent, groceries, entertainment, bills, etc. |
| Extended Warranty | An additional form of protection that can be purchased to extend/enhance a manufacturer's warranty on consumer goods, like phones and electronics |
| FDIC Insurance | Protection provided by the Federal Deposit Insurance Corporation; protects the deposits of customers against loss up to $250,000 per account |
| Federal Deposit Insurance Corporation (FDIC) | The government agency that insures customer deposits if a bank fails up to $250,000 per individual depositor |
| Federal Housing Administration (FHA) | A part of the U.S. Department of Housing and Urban Development. It provides mortgage insurance on loans made by FHA-approved lenders. |
| Federal Insurance Contributions Act (FICA) | A federal law that requires an employer to withhold taxes from the wages they pay their employees; the funds go toward Social Security and Medicare |
| Federal Trade Commission (FTC) | A government organization whose role is to protect consumers and competition by preventing anti-competitive, deceptive, and unfair business practices through law enforcement, advocacy, and education |
| FHA Loan | A type of mortgage that is insured by the government. FHA loans approve borrowers with lower credit scores and/or lower down payments than a conventional mortgage. |
| FICO Score | The most commonly used credit score |
| Financing | To buy an item with credit and pay it back over time with interest |
| Fixed Expense | A cost that can be expected at regular intervals and that remains the same amount (e.g., monthly rent payment) |
| Fixed Income | Income that remains the same from week to week or month to month |
| Fixed-Rate Loan | A loan with an interest rate that does not change over the life of the loan |
| Fixed-Rate Mortgage | A mortgage that has a fixed interest rate for the entire term of the loan as long as ontime payments are being made |
| Foreclosure | A legal process in which a lender attempts to recover the balance of a loan from a borrower who has stopped making payments by forcing the sale of the property |
| FSA | Flexible Spending Account. An account set up through an employer to cover health costs with pretax dollars that has very little or no rollover from year to year. |
| Generational Wealth | The assets, resources, and financial advantages that are passed down from one generation to the next within a family |
| Good Debt | A debt that is likely to increase a person’s net worth or generate future income |
| Grace Period | The number of days between a borrower's statement date and when payment is due, often without accruing interest |
| Gross Pay | Total earnings before any deductions are taken |
| Health Savings Account (HSA) | An account in which you can save pre-tax dollars to pay for out-of-pocket health care expenses |
| HMO | Health maintenance organization. A health insurance plan in which patients receive health care from designated providers. |
| Home Appraisal | An estimate of a home’s value based on its features and the value of comparable homes. |
| Home Equity | The value of ownership built up in a home or property that represents the current market value of the house minus any remaining mortgage payments |
| Home Inspection | An examination to certify the condition of a home, including the roof, foundation, basement. |
| Home-Equity Loan | A consumer loan extended to a homeowner that uses the borrower's home as collateral |
| Homeowners Association (HOA) Fees | A monthly fee to cover the cost of maintaining shared community areas. |
| Homeowners Insurance | A form of property insurance, available to property owners, that covers losses to the physical structure as well as to their personal property and protects the insured person from liability claims |
| Housing Insecurity | A condition in which a person or family's living situation is not safe or certain. It can be due to a variety of factors such as high housing costs, poor housing quality, overcrowding, etc. |
| HSA | Health savings account. An account where you contribute pre-tax dollars for expected medical expenses |
| Income | Money that is received from work, investments, business, etc. |
| Income Tax | Taxes paid by employees to federal and state government through a direct deduction from their paycheck |
| Index Fund | A low-fee portfolio of stocks chosen to track or mimic a stock market index, thereby removing the human element of investing because no one is choosing the individual stocks |
| Individual Retirement Account (IRA) | An investing tool for individuals to earmark funds specifically for their retirement |
| Inflation | The rate at which the price of goods increases and consumer purchasing power decreases over time |
| Installment Loan | Loan used to finance a specific purchase for a specific amount of time, during which regular payments pay the accrued interest and a portion of the principal |
| Insurance | An agreement where you make regular payments to a company and the company promises to pay you money if you suffer a specified injury, illness, loss, etc. |
| Insurance Agent | An employee of an insurance company who sells insurance policies and provides customer service |
| Insurance Fraud | An act on the part of either the buyer or seller of an insurance contract in an attempt to gain money illegally |
| Insurance Policy | A contract in which an individual or entity receives financial protection or reimbursement against losses |
| Insurance Premium | The specified amount of payment required periodically by an insurer to provide coverage under a plan for a defined period of time |
| Interest | The amount you owe as the cost of borrowing money |
| Interest Income | Income earned through interest on savings accounts, bonds, CDs, etc. |
| Interest Rate | The rate charged for borrowing money usually expressed as a percent of the amount borrowed |
| Introductory APR | The typically low rate charged during the introductory period after a credit account is opened, after which the regular, typically higher, APR will apply |
| Investment | An asset or item that is acquired with the goal of making a profit |
| Lease | A contract (often used for cars or property) by which one party gives property to another for a specified time, usually in return for a periodic payment |
| Liability | Something a person or company owes, usually a sum of money |
| Liability Coverage | Auto insurance that protects you against medical costs for the bodily injury of others and damages to the property of others if you are at fault in an accident |
| Life Insurance | Insurance paid to named beneficiaries when the insured person dies |
| Listing Agent | A type of real estate agent who works for the seller. They help the seller prepare the property for sale, market it to potential buyers, and negotiate the sale price and terms on the seller's behalf. |
| Living Paycheck to Paycheck | Using most or all of your monthly income to cover your monthly expenses, leaving little to no spare cash for saving or investing |
| Loan | An agreement where you are credited with a fixed amount of money for a fixed period of time, usually with interest |
| Loss | When someone with insurance endures a negative outcome, such as injury or theft, and expects payment from the insurance company to compensate them |
| Loss Aversion | The tendency to regard losses as considerably more important than gains of comparable magnitude |
| Maintenance Fee | A monthly fee that some banks charge to provide access to checking or savings accounts |
| Manufacturer's Suggested Retail Price (MSRP) | The price that manufacturers suggest retailers use to sell their merchandise |
| Medicaid | A government-run insurance program that provides healthcare assistance to low income Americans |
| Medicare | A government-run insurance program that provides healthcare assistance to elderly and disabled Americans |
| Minimum Liability Limit | The lowest amount of auto insurance coverage one can have to be legally allowed to drive in each state |
| Minimum Payment | The smallest amount of a credit card bill that a credit card holder must pay during a billing cycle to remain in good standing with the lender |
| Mortgage | A loan taken by individuals and businesses to make real estate purchases without paying the entire value of the purchase up front |
| Mortgage Preapproval | A document from a lender that states how much and what type of loan you are expected to qualify for. |
| Net Pay | Total earnings after payroll taxes and other deductions have been taken out; also called take-home pay |
| Net Price | The actual cost a student pays to attend a school, calculated as the sticker price minus grants and scholarships |
| Net Worth | A measurement of your assets (money you've saved or things of value you own) minus your liabilities (money you owe others); also called wealth |
| Non-Prime Loans | A type of loan given to individuals with poor credit scores who wouldn't qualify for other loans |
| Out of Pocket Maximum | The maximum amount of money you will have to spend on health care in a year, after which the insurance company agrees to cover all costs |
| Overdraft Coverage | A loan banks offer to their customers when they try to withdraw more funds than they have in their account, usually for a fee and with interest |
| Overdraft Fee | A fee charged to your account when it lacks the funds to cover a withdrawal, but the bank allows the transaction to go through anyway |
| Overdraft Protection | A loan banks offer to their customers when they try to withdraw more funds than they have in their account, usually for a fee and with interest |
| Pay Yourself First | A strategy where you save a specified amount of your paycheck before doing anything with the rest of your money |
| Paycheck Stub | A document attached to every paycheck that details your earnings and the amount withheld for taxes, health insurance, retirement funds, etc. |
| Payday Loan | A small loan, offered through a business, lent at a high interest rate, and meant to be paid as soon as you receive your next paycheck |
| Payee | The person to whom the check is made payable |
| Payroll Tax | Federal and state taxes that all employers must pay, based on a percentage of the employee's salary, toward social services such as Social Security and Medicare |
| Penalty APR | A higher interest rate triggered by being late with or missing a credit card payment |
| Pension | A retirement account, offered in some job sectors or companies, that an employer maintains to give an employee a fixed payout at retirement |
| Personal Loan | A type of loan issued by a bank, credit union or online lender that you pay back in fixed monthly payments, typically over two to seven years |
| PPO | Preferred provider organization. A health insurance plan in which providers agree to deliver services for discount fees; patients can go to any provider, but using nonparticipating providers results in higher costs to the patient. |
| Premium | The specified amount of payment required periodically by an insurer to provide coverage under a plan for a defined period of time |
| Principal | Original amount of money borrowed, separate from interest or fees |
| Probability | The chance of something happening or not happening within a certain number of occurrences |
| Progressive Tax | A tax system that uses tax brackets to collect a larger percentage from the income of high-income earners than it does from low-income earners |
| Property Tax | A tax paid on property (real estate) owned by an individual or corporation |
| Quote | An estimate of what premium you would pay for a certain insurance coverage plan |
| Rate Of Return | The ratio of money gained or lost on an investment relative to the amount of money invested; also known as return on investment (ROI) |
| Real Estate Agent | A person whose job it is to help buy or sell houses, for people. |
| Realtor | A real estate agent who is a member of the National Association of Realtors |
| Refund | An amount that a government gives back to a taxpayer who has paid more taxes than were due |
| Renters Insurance | A form of property insurance, available to renters, that covers losses to their personal property and protects the insured person from liability claims |
| Residential Lease | A contract between a tenant and a landlord providing the terms and costs for renting the property |
| Revolving Credit | An open line of credit that can be used for any purchases as long as you are under the limit; its payments vary monthly based on size of the debt |
| Risk | A situation involving exposure to danger, harm, or loss |
| Risk Pooling | The spreading of financial risk evenly among a large number of contributors to the program |
| Roth IRA | An individual retirement account that allows a person to set aside after-tax income up to a specified amount each year |
| Salary | A fixed amount that you are paid over a period of time, regardless of how many hours you work |
| Secured Credit Card | A type of credit card that requires the borrower to pay the company a fixed, up-front amount of money as collateral, which becomes the credit limit of the card, thereby making it low-risk to the credit card company |
| Secured Debt | Debt tied to a specific tangible asset that can be used as collateral and repossessed if payments are not made |
| Shareholder | A person, company, or institution that owns that least one share in a company |
| Social Security | A federal program that provides monthly benefits to millions of Americans, including retirees, military families, surviving families of deceased workers, and disabled individuals |
| Sole Proprietor | A person who is the exclusive owner of a business |
| Standard Deduction | A standardized dollar amount that reduces your taxable income, specifically for individuals who do not receive additional benefit by itemizing their deductions into medical expenses, donations, etc. |
| Statement | A monthly record of your account transactions provided by your credit card company electronically or on paper |
| Stock | A share of the value of a company, which can be bought, sold, or traded as an investment and which gives the investor small partial ownership of the company |
| Subscription | An amount of money that you pay regularly to receive a service or product |
| Surcharge | An additional fee that is usually higher than what you could pay for the item or action on your own |
| Surplus | When your income exceeds your expenses and you have money leftover |
| Tax Bracket | A range of income amounts that are taxed at a particular rate |
| Tax Credit | An amount subtracted directly from the tax owed |
| Tax Deduction | An amount that can be subtracted from person's tax liability that lowers their taxable income |
| Tax Rate | The percentage at which taxes are paid on each dollar of income |
| Tax Refund | |
| Tax Return | An annual report to the IRS summarizing total income, deductions, and the taxes withheld by employers |
| Taxable Income | The amount of income that is used to calculate an individual's or a company's income tax due |
| Term | The amount of time you have to repay your entire loan |
| Trade-In Value | The amount a dealer gives you for a car you currently own as partial payment for the car you wish to purchase |
| Traditional IRA | An individual retirement account that allows a person to set aside pre-tax income up to a specified amount each year |
| Transaction Fee | A fee that is charged if the number of withdrawals from your savings account exceeds the federal limit, which is six free withdrawals and transfers per month |
| Types of Credit | Also known as your credit mix. This can include a mix of accounts from credit cards, retail accounts, installment loans, finance companies and mortgage loans. 10% of your credit score is based on this. |
| Underwriter | An employee of an insurance company who evaluates an individual's risk factors and assigns premium amounts |
| Unearned Income | Income received from sources other than employment |
| Uninsured/Underinsured Coverage | Auto insurance that protects you against another driver not having enough coverage to pay the entirety of your losses |
| Unit Price | The cost for one item or measurement that allows it to be easily compared to other similar products to evaluate which is a better deal |
| Unsecured Debt | Debt not tied to a specific asset, making it difficult or impossible for the lender to repossess items if payments are not made |
| USDA Loan | A type of mortgage designed for low- and moderate-income borrowers in rural areas. |
| Utilities | The basic services your home, apartment, or business needs to keep it comfortable and functioning properly (e.g. water, electricity, etc.) |
| Variable Expense | A cost that appears irregularly or that changes in amount (e.g., utility bills) |
| Variable Income | Income that varies from week to week or month to month |
| Variable-Rate Loan | A loan in which the interest rate can change, based on prime rate or index rate, over the course of the loan |
| Vehicle History Report | A detailed history of a car including its previous owners, damage, repair work, and more |
| W-2 | A form that an employer must send to an employee and the IRS at the end of the year to report the employee's annual wages and taxes withheld from their paycheck |
| W-4 | A form completed by an employee to indicate his or her tax situation (exemptions, marital status, etc.) to the employer, who then withholds the corresponding amount of taxes from each paycheck |
| Wage | A set amount you are paid for every hour that you work; also called hourly pay |
| Warranty | A company's or a store's written agreement to repair a product or refund your money if the product doesn't function properly |
| Withholding | The portion of an employee's wages that is not included in their paycheck because it goes directly to federal, state and local taxes |
Created by:
spuccini
Popular Business sets