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Basic Personal Finan
Basic Personal Finance Terms
Term | Definition |
---|---|
The amount of money you earn. This can come from a job or investments. It is limited. | Income |
Money earned per hour in exchange for your physical or mental labor | Wage |
Fixed amount of money earned per day, month, or year in exchange for your physical or mental labor | Salary |
Giving money in order to receive a good or a service | Spending |
Things you must have to survive | Needs |
Things you would like to have to raise your standard of living | Wants |
A spending plan | Budget |
Long term plan on how you are going to use your money (kind of like a long term budget) | Personal Money Management Plan |
Fancy word for putting money somewhere in your budget | Allocation |
Money put away to be used later | Savings |
Borrowing money and promising to pay it back later with interest added. Can be a loan or credit cards | Credit |
Fee paid for the use of borrowed money | Interest |
A yearly rate that determines how much interest you will pay for loans | Interest Rate |
Allowing others to use your money in return for giving you interest | Investing |
Someone who takes on personal risk to start a business | Entrepreneur |
The least amount that you are required to pay on a debt | Minimum Payment |
A fee paid when you pay a bill after the due date | Late Fee |