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Review for Final
| Question | Answer |
|---|---|
| Your goal in developing a ________ plan is to be able to pay all of your expenses each month and put money into a savings or investment account and having a good spending plan in place will help you achieve this goal. | spending |
| The first section of a spending plan is ______. | income |
| Do not ever provide information in an e-mail directly in the ____ of the e-mail or in an __________ which contains your personal information. | body, attachment |
| A __________ is goal is one you want to achieve in less than __ months time. | short-term, 12 |
| An ____________ goal is one you want to achieve in more than 12 months, but less than _ years. | intermediate, 5 |
| A _________ goal is one you want to achieve in more than five years and possibly up to ________ years. | long-term, 30 to 35 |
| When you choose a bank, you should three things in mind: | 1. Convenience 2. Service 3. Cost |
| A _______________ is one of the most widely recognized of the banking institutions because they have been so well known throughout the years. | commercial bank |
| _____________ do not have physical locations you are able to walk into and do your banking. | Virtual banks |
| Each time you use a debit card, the money is taken from your account almost __________. | immediately |
| The top two features of online and mobile banking are convenience and _________. | security |
| The two basic forms of credit most commonly used are: | 1. Credit card 2. Installment loan |
| The __________________________ is the percentage of interest you pay on an annual basis based on how much you have borrowed. | annual percentage rate |
| You must pay at least the _______________ each month to avoid late charges and lowering your credit rating. | minimum payment |
| When you _______ on a loan or a credit card, this means you have stopped making payments, usually because you are unable to afford the payments. | default |
| Three things affect your credit card costs: | 1. Annual fee 2. Finance charge 3. Grace periods |
| Credit scores range from ___ to ___. | 500, 810 |
| This is an overall score assigned to your account by the credit bureaus. The ______ the number is, the ______ your rating is. This means, the _______ your credit rating is, the _____ your interest rate will be. | higher, better, better, lower |
| __________ is the interest rate used by most banks and based on the federal fund rate. | Prime rate |
| The _______________ represents how much is still owed on your account from the previous month’s statement. | opening balance |
| Your ________________ represents how much is owed on your account after your most recent payments and purchases are taken into account. | closing balance |
| There are three national credit bureaus: | 1. Equifax 2. Experian 3. Transunion |
| There are _ main criteria credit bureaus use to determine your credit rating or score. | 5 |
| These five criteria are: | 1. Payment history 2. How much you owe 3. Length of credit history 4. How much new credit 5. What types of credit |
| ______________ are normally used for various types of big ticket purchases individuals routinely make. | Personal loans |
| The _________ is the actual amount of money you borrowed from the lender for your purchase. | principal |
| The ____ is the length of time the loan is set up for you to pay it back. | term |
| When you put up collateral for a loan, it is said to be a ____________. | secure loan |
| __________ is an asset, usually what is being purchased, which the bank owns the rights to until the loan is paid in full. | collateral |
| You can deposit money into a ________ _______ ___ _____ ______ ____________ at any time. | personal savings and money market account |
| You can only make a deposit when you open a __. | CD |
| A federally sponsored corporation which insures accounts in national banks and other qualified institutions up to $100,000 is called the ____. | FDIC |
| FDIC stands for: | Federal Deposit Insurance Corporation |
| How much a person makes relative to how much they are obligated for is called _______________ ratio. | debt-to-income |
| The three types of investment accounts are: | taxable, tax-deferred, and tax-exempt. |
| There are three areas you must consider when choosing an investment. They are: | Liquidity, risk and return. |
| A ______ is what you make or earn on an investment. | return |
| What are the 3 major stock markets reported here in the US? | 1. NASDAQ 2. Dow Jones 3. S & P 500 |
| What are four basic types of risk categories in investing? | 1. Low Risk 2. Limited Risk 3. Moderate Risk 4. High Risk |
| ________ investments provide a guaranteed return or principal to the investor in addition to interest earned during the investment period. | Low-risk |
| ____________ investments are in companies and governments who are well established, pay dividends and are known for their consistent growth. | Limited-risk |
| _____________ investments are generally in companies who have room for growth. | Moderate-risk |
| ________ investments are generally on speculative investments, such as futures, brand new companies and high-yield bonds. | High-risk |
| _________ are a portion of a corporation’s assets paid to stockholders on a per share basis. | Dividends |
| An ___________ is when the company makes a profit and then pays its investors a dividend based on that profit. | income stock |
| A ___________ is a company which experiences growth and its stock value increases where the investor can make money when he decides to sell the stock. | growth stock |
| ________________ are named as such because they usually hold their value better during downturns in the economy and the capital markets. | Defensive stock |
| _____ represent a loan which is being made to a corporation or government entity by a group of investors. | Bonds |
| __________ is another term for how much return the fund has earned in the past. | Performance |
| ____ is the level of likelihood you may earn or lose the money you invest. | Risk |
| _________ allows individuals to collectively share the cost of such losses by paying their money into one large pool of money, making it more affordable for everyone to cover a financial loss if it occurs. | Insurance |
| _______ an amount of money we might pay to an insurance company on a monthly or an annual basis for the payment of that insurance. | Premium |
| __________ the amount of that loss you are going to suffer yourself before the insurance company pays their portion of the loss. | Deductible |
| ____________ is used to provide financial support in the event of your death to your dependents so their lives can continue, at least financially, after you are gone. | Life Insurance |
| What are two basic types of life insurance policies? | 1. Term 2. Cash Value |
| A ______________ policy is where the face value decreases each year. | decreasing term |
| A _______________ policy’s premiums are adjusted, usually higher, each year when the policy is reviewed and renewed. | annual renewable |
| A ___________ policy is when your premium in year one is going to be the same as it will in the final year of the policy. | level premium |
| ________ is an insurance program designed for low-income individuals in low-income households. | Medicaid |
| ________ are specific types of losses which will not be covered in the homeowner’s policy. | Exclusions |
| _____________ is probably the most common form of insurance. | Auto Insurance |
| The _____ your credit score, the _____ your premium will be. | lower, higher |
| Most every U.S. citizen must file a federal income tax return on or before _________. | April 15th |
| You receive your income information from employers on ___ form. | W-2 |
| When you are hired as contract labor you receive a ____ to show your income information. | 1099 |
| The most basic tax form is the short form or ______. | 1040EZ |
| Which form is the most commonly used tax form? | 1040 |
| If you make a mistake on your taxes, you can amend your tax return by filing a _____ form. | 1040X |
| IRS stands for: | Internal Revenue Service |
| The main reason the government collects taxes is for _______. | revenue |
| The most common tax on the federal level is the ___________________. | Federal Income Tax |
| A _____ tax is usually a flat percentage of an item you purchase. | sales |
| Before you ever receive your first paycheck, you will have to fill out a ___ form for your employer. | W-4 |
| Fill in the lines below to show the order of a 1040 Form | 1. Gross Income 2. Adjustments 3. Adjusted Gross Income 4. Exemptions 5. Deductions 6. Taxable Income 7. Credits 8. Taxes Paid 9. Refund or Amount Owed |
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