Financial Terminology Quiz Flashcards Preview

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Flashcards in Financial Terminology Quiz Deck (18)
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1
Q

Maybe income

A

Income not contractually guaranteed

2
Q

Social security

A

US Federal Government program that provides retirement income

3
Q

Social security benefits

A

Monthly income payments to retired workers

4
Q

Pension

A

Compensation received by an employee from a company they retired from

5
Q

Explain the difference between income vs asset

A

Income is money received from working/investing

Asset is a pool of money that has been saved/invested

6
Q

Qualified plan

A

Qualifies for tax advantages

7
Q

Non qualified plan/asset

A

Not qualified for tax advantages

8
Q

Stock

A

Ownership interest in a company

9
Q

Bonds

A

Loan between investor and institution

10
Q

CD (2 points, know abbreviation and meaning)

A

Certificate of deposit

Gives fixed rate for a fixed term

11
Q

Mutual fund

A

Pool of money from many investors invested into securities

12
Q

Annuity

A

Insurance contract designed to provide payments to individuals

13
Q

Annuitization

A

Turning on the income payments from an annuity

14
Q

Dollar cost averaging

A

Systematic savings into an investment

15
Q

Reverse dollar cost averaging

A

Systematic withdrawals from an investment

16
Q

RMD (2 points, know abbreviation and definition)

A

Required minimum distribution

Money that must be taken from qualified plans at age 70.5

17
Q

What’s the difference between simple and compound interest?

A

Simple is only interest on the principal

Compound is interest on interest on the principal

18
Q

Guaranteed income

A

Income contractually guaranteed