Personal Finance

Term Definition
Economic relates to matters of finance
Need something that you must have in order to live
Value idea about right and wrong and what is important in your life
Want thing that you would like to have but is not necessary for survival
Education goal goal which enables a person to prepare for future success in the workplace
Financial decision a major decision that impacts an individual's or family's well-being
Financial goal specific objectives to be accomplished through financial planning
Goal something a person wants to have or to achieve and is willing to work for
Major decision decision that has a long-term effect of a person's life
Long-term goal a goal that requires a considerable amount of time to achieve
Routine decision decision that is made on a day-to-day basis; routine decisions do not require a lot of thought
Short-term goal a goal that requires a short period of time to achieve
Standard of living the minimum necessities, comforts, or luxuries thought to be essential
Well-being state of being happy, healthy, and prosperous
Career an occupation to which you have made a long-term commitment
Human capital skills acquired through a process of self investment
Interest inventory an assessment that helps people identify their interest areas
Job a position in which a person works to earn an income
Occupaion a regular activity, especially a person's employment or job
Transferable skill skill acquired through various jobs, volunteering, hobbies, or other life experiences
Direct Deposit an arrangement in which a person's pay is electrically transferred directly into the recipient's bank account
FICA Federal Insurance Contribution Act; social security taxes to provide retirement income and disability benefits
Form I-9 employment eligibility verification; documentation must be provided to verify that the person is eligible to work in the U.S
Form W2 wage and tax statement; states the amount of money earned and taxes paid through the previous year
Form W4 withholding allowance certificate; determines the percentage to be withheld for taxes
Gross pay the total amount of money a person earns
Medicare tax nation's health care program for the elderly and the disabled
Net pay the amount of income left after taxes and other deductions are taken out
Pay period start and end dates used to calculate earnings
Paycheck money given to an employee for work completed
Paycheck stub the part of a paycheck that allows an employee to see how much has been withheld
Payroll card prepaid card instead of a paper check or direct deposit
Payroll withholding the amount of money subtracted from the gross pay for taxes
Personal information the employee's name address and social security number
Taxes a mandatory payment made by an individual or organization to the governemnet for public needs
Withholding tax the amount required by law for employer to withhold from earned wages to pay taxes
Year to date totals all of the deductions which have been withheld from January 1 to the last day of the pay period
Expense money that is spent
Income money received that is available to spend and save
Insurance protection against financial loss
Major expenditures the largest expense categories in a spending plan-includes housing, transportation, food, and insurance
Mortgage long-term home loan
Rent a monthly payment to an individual who owns the home in which one lives
Risk uncertainty about a situation's outcome
Spending plan a plan for spending and saving money based on a person's goals during a given time
Certificate of Deposit an account that pays interest on a lump sum of money that is required to stay in deposit for a specific period of time
Comparison shopping comparing products and prices in different stores before making apurchase
Impulse buying making an unplanned or quick purchase without giving it much thought
Money market deposit account an account that pays higher interest than a savings account but requires more money to open
Opportunity cost something an individual gives up to receive something else
Savings an account in which a depositor sets money aside for future use
ATM automated teller machine; cash machine
Annual fee a fee charged once per year for credit card ownership
Annual percentage rate (APR) yearly percent amount it will cost a person to use credit
Check 21 when a written check is electronically transferred and funds are immediately withdrawn from the account; similar to debit card
Credit an arrangement that allows consumers to buy goods or services now and pay for them later
Credit line maximum amount of money that can be charged to a credit card
Creditor a person/company who lends money in accordance with a legal contract
Debit card a card that automatically deducts money from your checking account when it is used for purchases
Due date date that a payment is due
E-banking electronic banking; uses computer networks to transfer funds electronically among various bank accounts
Finance charge the total amount that a person is charged for borrowing money; includes interest plus any service charges or insurance premiums
Interest the price a borrower pays a creditor for the use of money over a period of time
Late payment fee fee charged when a cardholder does not make the minimum monthly payment by the due date
Minimum payment minimum amount of a credit car bill that must be paid monthly
Personal identification number (PIN) unique 4 digit number associated with your debit cards and monetary transactions
Checking account an account in which checks are written by a depositor directing a bank to pay a certain amount to a specific source
Checks a written order directing a bank to pay money as instructed from a particular account
Commercial bank a financial institution which lends, issues, borrows, and protects money for the general consumer
Deposit money put into an account
Financial institution a business that offers and sells financial services to people
Interest earning a checking account that earns money usually requiring a minimum balance
Signature authorization card a card that includes all the important information that a bank needs to provide financial services to a person
Withdrawal money taken out an account
Blank endorsement anyone can cash the check after the check has been singed by the receiver of the check
Bounce occurs when there is insufficient funds in an account to pay a check; results in substantial penalties
Checkbook contains the checks and register to track money transactions
Deposit slip contains the account holder's number and allows money to be put into the correct account
Outstanding transaction items which have not cleared through the bank and are not listed on the statement
Payee the person to whom a check is being written
Reconcile to balance the checkbook register each month to the balance shown on the statement
Restrictive endorsement allows the check to only be deposited
Special endorsement check can be transferred to second party if the receiver signs and writes "pay to the order of"; a two party check
Statement mailed monthly listing each monetary transaction and the current account balance

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