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Terms in this set (71)
Characteristics of money
functions of money
-store of value --> save for future
money backed up by
U.S.--> backed by goods and services you can get ~confidence~ "In God We Trust" <-- on bill to get people to TRUST the money
also backs up money; money because the gov't says so
does NOT back up money --> we print as much money as we want --> inflation is the result
U.S. MINT (Treasury Dept.) not FED
cash less society
-credit cards: NOT money..DEBT; small loans with HIGH interest
-debit card: from checking acct; PIN
-online pay: pay pal, apple pay, etc.
secured check, costs money ex. Western Union
from a bank
move "money" from one acct. to another ex. online bill pay
Sources of income
-salary: job, entrepreneur
-rental income: uber, lyft
-investments: real estate, business
-interest: rent $ to others
Factor that impact INCOME
-increase your skills --> skill to learn "coach-able" create VALUE
-school (level of edu)
natural, capital, entrepreneur
income before taxes
income after taxes
deductions go towards
FICA, Medicare, U.S. and State tax
optional deductions are
401(k), IRA, ROTH IRA-retirement
tax lien-gov't holds money to pay back taxes or assets
-education--> tuition, job training
-vacation & sick days
in January, shows ALL deductions for the past year
exemptions deductions from paycheck; 0 or 1
time value of money- the longer you wait to save the more expense
price of money
borrower- "renting money"
saver- paid for saving; opportunity cost compensation
Rule of 72 (70)
70/ rate of growth= # of years to double
interest earns interest ex) mutual funds (investing), credit cards (debt)
A general and progressive increase in prices; erodes value of money
If your credit card is stolen what are you liable for IF you report it within 30 days?
Federal Reserve System
distributes new coins and currency into the economy
lead to an increase of the interest on a person's credit card
IOU to a company or the gov't
buy bonds at LESS than face value ex) $100 bond cost $90
Predatory Lending Practices include
-A creditor knocking on your door and agrees to refinance your mortgage without looking at your credit history
-An individual agreeing to a high cost loan with excessive fees
-A lender who expects a loan to be refinanced when you are unable to make payments
You are entitled to receive a free copy of your credit report within ____ days of denial
using someone else's money to pay at a future date & paying a fee for using the money
corporation or gov't agency borrows money from an investor & pays interest & principal to same investor
What are U.S. Treasury Notes guaranteed by
an investment that holds a wide range of different investments, providing diversification
How long do you have to wait to with draw money after depositing it into your account?
3-7 days after
credit card finance charge
dollar amount it cost to use crefit
purchased with specific amount of money that can be used too pay for goods and services
right you have as a share holder of common stock
able to receive dividends if paid
shares of stock
what happens if you lose your debit card and don't alert your bank and someone uses it?
you have unlimited liability
functions as cash & are easily replaced if lost
predatory lending practices do NOT include
a loan you can afford with an interest rate that is the same as the interest rate being charged by at least 3 other institutions
corporations issue stock to
raise money for the corporation
why do lenders use consumer credit?
to help make their decisions
what pays the highest interest rate?
Certificate of Deposite
loan to the issuer of the bond
Most ____________ charge a fee for setting up & administering a debt repayment plan
Consumer Credit Counseling Services (CCCS)
___________ interest is taxable
_______________ charge highest interest rate
canceled checks are NOT
returned to save the bank money associated w/ returning copies of the checks
If someone makes a deposit of 10,000 or more the bank MUST notify __________
US Treasury Dept.
True or False: some checking accounts pay interest
True or False: There is a penalty for withdrawing from a Certificate of Deposit account
ease & speed with which you can convert savings or an investment to cash
what does a bank endorsement do to a check?
creates a check that can be cashed by anyone
Certificate of Deposit has the ___________ predictable income
Savings EE Bond
the financial product you can buy for $25, is safe, and will be worth $50 at a future date
purchased certificate to pay a specific amount to a specific payee
Reducing fees for ATM transaction
get cash back at the store when making a purchase rather than going to an ATM
example of savings plan
getting a certain amount of money transferred electronically into your account each month
if someone surrenders a life insurance policy....
they receive a calculated amount of money which includes paid premiums and interest on the money
Insurance does NOT
diversify an investment portfolio
a loan backed by an asset
A personal loan without assets to cover the loan amount.
if there is incorrect info on your credit report you can....
request that the credit bureau to correct the credit report
when you mail your credit card payment on the due date your payment will be considered.....
late and you will have to pay a late fee
you can continue to charge purchases on a credit card when....
the amount you owe on the card is below the card limit
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