28 terms

Saving and investing Vocabulary

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Simple Interest
The amount of money paid or earned for the use of money
compound Interest
interest calculated on both the principal and the accrued interest
rate of return
The return on an investor's capital. Also called Yield. Expressed in a percentage
risk
The chance that an investment's actual return will be different than expected.
Liquidity
being in cash or easily convertible to cash
EE Savings Bonds
Government investment which you put down in cash half the face value and wait for it to mature
Mutual Funds
a pool of money invested by a professional in a group of stocks.
Stocks
Shares of ownership in a corporation.
Bonds
a certificate issued by a government or private company which promises to pay back with interest
Securities
All of the investments, including stocks, bonds, mutual funds, options, and commodities, that are traded.
Real Estate
Land including all the natural resources and permanent buildings on it.
Retirement Plans
Company sponsored programs for providing retirees with income
individual Retirement Account
a self-funded retirement plan that allows you to contribute a limited yearly sum toward your retirement
Pay yourself first
taking a certain amount of all money you receive and saving it to be used for spending on longer-term goals
Saving Accounts
the amount of money you have in the bank that you receive interest on
Share accounts
The credit union term for a checking account
Check accounts
an account you can deposit and withdrew
Certificates of Deposit
you are loaning a bank money for a set period of time and getting interest in return.
Principal
the major party to a financial transaction at a stock exchange
Annual Percentage Rate
the total cost of credit expressed as a yearly percentage
Maturity Date
the date when a bond will be repaid
Direct deposit
An automatic deposit of a paycheck without having to take a physical check to the bank.
payroll deduction
Charges subtracted from your paycheck
FDIC
a federally sponsored corporation that insures accounts in national banks and other qualified institutions
NCUA
agency of many credit unions
Rule of 72
the amount of time it takes for money to double in value
Asset
something of value, a resource
Diversification
A risk management technique that mixes a wide variety of investments within a portfolio