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Dave Ramsey Chap. 1
Foundations in Personal Finance Middle School Edition
Term | Definition |
---|---|
Anything of value that is owned by an individual | Asset |
A monthly plan for how you are going to save and spend your income | Budget |
Interest paid on an investment and on any interest previously earned | Compound Interest |
A person or organization that purchases a product or service | Consumer |
The granting of a loan and the creation of debt | Credit |
An obligation to repay borrowed money | Debt |
The cost of goods or services | Expense |
The charge for borrowed money generally defined as a percentage; also, the earned interest on money you save or invest | Interest |
Money put into an account intended for growth | Investments |
Anything you owe; a debt | Liability |
The total value of a person's assets ( things owned) minus their liabilities (things owed); may be a positive or negative dollar amount | Net Worth |
A federally recognized, tax-exempt organization such as a church, hospital, charity, or school that serves the public in some capacity | Nonprofit Organization |
All the money decisions a person or family makes including earning, budgeting, saving, spending, and planning for the future | Personal Finance |
Interest paid only on the principal investment | Simple Interest |
An unlimited amount of wants but limited resources | Scarcity |
First Foundation | Save a $500 emergency fund |
Second Foundation | Get out of debt |
Third Foundation | Pay cash for your first car |
Fourth Foundation | Pay cash for college |
Fifth Foundation | Build wealth and give |
Personal finance is about 80% ____________ and it's only 20% ________ _________. | behavior, head knowledge |
Becoming money-smart involves what four things? | Work, Spend, Save, and Give |
Debt is ___________ ______________ to anyone for any reason | owing anything |
Whenever you receive money as a gift or for work what should you do with some of it? | Put it away for savings |
What are the three basic reasons to save money? | Emergency Fund, Purchases, Wealth Building |
Interest on credit is a _______ you pay on top of the money your already __________. | fee, owe |
Investments are things that are purchases with an expectation that they will grow in _________ or produce ___________ over time | value, income |
Needs are thing you (want or have) to have? | have |
Wants are fun but not _________________ to survive | necessary |
It's important to have a ______ for what you're going to do with your money | plan |
The plan for your money is called a ___________ | budget |
What kind of card allows you to use the money your already have in the bank? | debit card |
What kind of card means you use debt to buy stuff? | credit card |
What is the average personal debt using a debit card? | $0 |
What is the average personal debt using a credit card? | $4,878 |
What is the only thing a debit card won't do? | put you in debt! |
_______________ people are not fun to be around | Selfish |
When you become the opposite of selfish, you become _____________. | Selfless |
More than money....You can give by giving of your _________. | time |