Personal Finance Vocabulary Flashcards
(18 cards)
Salary
Compensation received by an employee for services performed. A salary is a fixed sum paid for a specific period of time worked, such as weekly or monthly.
Gross income
total pay before taxes and other deductions are taken out.
Minimum wage
A wage set by contract or by law as the lowest that may be paid to employees.
Net income
Amount of money you receive in your paycheck after taxes and other deductions are taken out; also called take-home pay.
Overtime
working time in excess of a standard day or week
ATM/Debit Card
A card that resembles a credit card but which debits a transaction account (checking account) with the transfers occurring contemporaneously with the customer’s purchases. A debit card may be machine readable, allowing for the activation of an automated teller machine or other automated payments equipment.
Credit/Credit Card
An open-ended loan that allows you to borrow money up to a certain limit and carry over an unpaid balance from month to month. There is no fixed time to repay the loan as long as you make the minimum payment due each month. You pay interest on any outstanding credit card loan balance.
Credit Limit
A limit set by the credit card company on how much you can charge on the card it issued to you. You can use your credit card to make purchases up to your credit limit.
Credit Rating
An estimate of the amount of credit that can be extended to an individual or business without undue risk.
Account Balance
How much money you have in an account or how much money you owe, whether that’s a bank account or a credit card account.
Principal
The unpaid balance on a loan, not including interest; the amount of money invested.
Interest
A fee for the use of money over time. It is an expense to the borrower and revenue to the lender. Also money earned on a savings account.
Debt
Money you owe another person or a business.
Checking Account
An account at a bank (sometimes called a share draft account at a credit union) that allows you to make deposits, pay bills, and make withdrawals.
Savings Account
An account at a bank (sometimes called a share savings account at a credit union) used to set aside money and that pays you interest.
401(k)
a retirement account to which employee and employer contribute, on which taxes are deferred until withdrawal, and for which the employee usually selects the types of investments
APR
The cost of borrowing money on a yearly basis, expressed as a percentage rate.
Mortgage
A temporary and conditional pledge of property to a creditor as security for the repayment of a debt.
