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ECON 6 - PersonalFin
Economics - Personal Finance
| Term | Definition |
|---|---|
| Mortgage | loan to purchase a house or real estate, bank owns property until loan is paid back |
| Principal | the initial amount invested or borrowed |
| Income | any money earned or received from working or gift |
| Debt | money owed by a person or business |
| Credit | the ability to buy goods or services now but pay later |
| Credit Score | a grade given to individuals based on their credit behavior and history, such as paying back loans on time and amount of debt |
| Interest Rate | payment percentage rate for use of money borrowed |
| Fixed Interest Rate | payment percentage rate for use of money borrowed that does not change over the life of the loan |
| Variable Interest Rate | payment percentage rate for use of money borrowed that fluctuates over time based on changes in interest rates |
| Compound Interest | earning interest on money saved and interest on interest earned along the way |
| Term | an agreed upon amount of time in which borrowers pay back loan |
| Equity | the value of property minus the amount you owe on the property |
| Asset | property owned by a person or company that has value |
| Liquidity | asset that can be quickly converted to cash while keeping its market value |
| Annual Percentage Rate (APR) | the yearly interest generated by the amount owed by borrower |
| Certificate of Deposit (CD) | savings account that holds a fixed amount of money for a fixed period of time in exchange for gaining interest |
| Mutual Fund | pools money from many investors and invests the money in stocks, bonds, and/or short-term debt |
| Bond | investor lends money to company or government for set period of time in exchange for regular interest payments |
| Credit Union | non-profit financial institution owned by the members and run by board of directors |
| Payday Loan Company | short-term, high interest loans based on your income and ability to pay back quickly |
| Insurance | means of guaranteeing financial protection against different risks |
| Deductibles | amount of money insured person must pay before insurance policy starts paying for covered expenses |
| Premiums | the amount you pay each month or year to keep your insurance policy active |
| Gross Income | all the money earned before taxes and other deductions are subtracted |
| Net Income | all the money earned after taxes and other deductions are subtracted and what you actually bring home |
| Withholdings | the portion of an employee's wages that is sent directly to government tax authorities as payment of estimated taxes |
Created by:
ddenson80
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