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Financial Planning > Topic 1 Volcab > Flashcards

Topic 1 Volcab Flashcards

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0
Q

The study of personal and family resources concert important in achieving financial success: involves how people spend, save, protect and invest their financial resources

A

Personal finance

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1
Q

Knowledge of facts, concepts, principles and technological tools are fundamental to being smart about money

A

Financial literacy

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2
Q

Means that you are accountable for your future financial well-being and that you strive to make wise personal financial decisions

A

Financial responsibility

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3
Q

Giving up one thing for another

A

Trade-off

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4
Q

Income not spent on current consumption

A

Savings

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5
Q

Assets purchased with the goal of providing additional income from the outset itself

A

Investments

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6
Q

Material well-being and peace of mind that individuals or groups earnestly desire and seek to attain, to maintain attained, to preserve or threatened and regain of lost

A

Standard of living

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7
Q

Achievement of financial aspirations that are desired, planned, or attempted as defined by the person who seeks it

A

Financial success

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8
Q

Comfortable feeling that her financial resources will be adequate to feel any need to have as well as most of your wants

A

Financial security

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9
Q

Experience you have when you were satisfied with your money matters, which is in part a result of practicing good financial behaviors

A

Financial happiness

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10
Q

Condition of increasing production business spending and consumption consumer spending in the economy and has increasing national income

A

Economic growth

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11
Q

Business cycles can be depicted as a wavelike pattern of rising following: phases of business cycle include expansion, peak, contraction, trough

A

Business cycle/economic cycle

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12
Q

Recurring period of decline in total output, income, employment, and trade usually lasting from six months to a year and Mark I widespread contractions and many sectors of economy

A

Recession

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13
Q

Time. When credit use shrinks in an economy instead of expanding as during normal economic times

A

Deleveraging

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14
Q

Occurs when the economy has a recession and then soon after emerging from her session with the short period of growth quickly falls back into recession

A

Double-dip recession

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15
Q

Any economic statistics such as unemployment rate GDP or inflation rate that suggests how well the economy is doing now and how well it might be doing in the future

A

Economic indicator

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16
Q

Nations broadest measure of economic health: reports how much economic activity has occurred within the US borders during a given period

A

Gross domestic product GDP

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17
Q

Statistics to change before the economy changes, that’s helping predict how the economy will do in the future such as stock market number of new building permits and consumer confidence index

A

Leading economic indicators

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18
Q

Economic indicator that moves in the same direction as the economy

Moves in the opposite direction of economy

A

Pro cyclic

Counter cyclic

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19
Q

Study and sustained rise in general price levels across sectors measured by changing cost overtime of market basket of goods and services that are typical household my purchase

A

Inflation

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20
Q

Composite index reported monthly by the conference board that suggests a future direction of economy

A

Index of leading economic indicators LEI

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21
Q

Broad sustained kind of prices of goods and services that is hard to stop once it takes hold, causing less consumer spending, or corporate profits, declining home values, rising unemployment, lower incomes

A

Deflation

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22
Q

Measure of goods and services that one’s income will buy

A

Purchasing power

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23
Q

Income measured in constant prices relative to some bass time period. It reflects the actual buying power money you have is measured in constant dollars

A

Real income

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24
Also called money income: income that has not been adjusted for inflation and decreasing purchasing power
Nominal income
25
Brought a measure of changes in the prices of all goods and services purchased for consumption by urban households
Consumer price index CPI
26
Short-term rate at which depository institution one balances at the federal reserve two other depository institutions overnight
Federal funds rate
27
Price of Borrowing money
Interest
28
Opportunity cost of any decision is the value of the next best alternative that must be forgone
Opportunity cost
29
Extra satisfaction derived from gaining one more incremental unit of a product or service
Marginal utility
30
Additional cost of the more incremental unit of some item
Marginal cost
31
Tax rate at which your last dollar earned is text
Marginal tax rate
32
Income that is totally and permanently for of taxes
Tax-exempt income
33
And come exempt from income taxes in the current year but will be subject to taxation in a later year
Tax sheltered income
34
Original amount invested
Principal
35
earning of interest on interest and arises when interest is added to the principal so that, from the moment on, the interest that has been added also earns interest
Compound interest
36
Addition of interest and principal: the effect of compounding depends on the frequency with which interest is compounded on the periodic interest rate is applied
Compounding
37
Variation of an asset projected to the end of particular time period in the future
Future Value
38
Formula for figuring the number of years it takes a double the principal using compound interest: simply divide the interest-rate that the money will learn into the number 72
Rule of 72
39
Current value of an asset that will be received in the future, also known as discounted value
Present value
40
Compensation from employment that does not take the form of wages, salaries, commissions or other cash payments
Employee benefit
41
Type of employee benefit plan where employees choose the benefits from a menu of taxable cash and or one more qualified non-taxable benefits, thereby providing funding mechanism by which employees may pay for the benefits they choose on a pretax basis
Cafeteria plan | flexible benefits plan
42
Employee benefit design to pay all or part of employees medical expenses
Health care plan
43
Plan that requires individuals to pay a higher deductible to cover medical expenses before insurance plan payments begin: chosen to save money on premiums
High deductible health care plan HD HP
44
Special savings account intended for people who have a high deductible health care plan
Health savings account
45
Advantages bestowed by legislation that reduce attacks on some preferred activity, such as employee participation and employers cafeteria plan, health savings account or retirement plan
Tax advantages
46
Employer-sponsored account as employee paid expenses for medical and dependent care to be paid with employees pretax dollars rather than after-tax income
Flexible spending account
47
Money income that has not been taxed by the government
Pretax dollars
48
Employee sponsored, defined contribution retirement plan such as 401(k) or similar
Tax sheltered retirement plan
49
Written document that spells out relationship between investor and advisor, guides how advisor will invest peoples money, do you tell people's investment philosophy, financial situation and risks willing to be taken
Investment policy statement
50
Finding employment that will use your interests, abilities and will support you financially
Career planning
51
Plan that identifies employment that interests you come up with your buddies, skills, worked out, lifestyle and provide strategic items to help you reach your career goal
Career plan
52
Long-standing topics and activities that engage your attention
Professional interests
53
Scaled surveys and assess career interests and activities
Interest inventory
54
Identifying what you want to do for a living weather specific job orfield of employment
Career goal
55
Describes progression for entry-level position to higher levels of pay scale responsibility and authority
Career ladder
56
When demands particular job with your social and cultural preferences
Lifestyle trade-offs
57
Job related activities that you can perform physically, mentally, artistically, mechanically, financially
Professional abilities
58
Natural abilities and talents that individuals possess
Aptitude
59
Your own way of working with and respondents job requirements surroundings associates
Works style personality
60
Forms of remuneration provided by employers to employees the result of an employee not having to pay out-of-pocket money for certain expenses also known as non-salary benefits
Employee benefits
61
Specific objectives addressed by planning and managing finances
Financial goals
62
Preestablished action plan implemented in specific situation
Financial strategies
63
Snapshots that described individuals current financial condition
Financial statements
64
Shut up assets, liabilities, net worth of a particular date
Balance sheet or net worth statement
65
Summary of all income and expense transactions over specific time
Cash flow statement or income and expense statement
66
Obligation paid off within one year
Short-term current liability
67
Obligation to be paid off in more than one year
Long term noncurrent liabilities
68
When a person I was more than he or she owns and has a negative net worth
Insolvent
69
Calculations designed to simplify evaluation of financial strength in progress
Financial ratios
70
Speed and ease with which an asset can be converted to cash
Liquidity
71
Documents that evidence financial transactions
Financial records
72
Financial targets to Cheeves more than five years and future
Long-term goals
73
Financial targets the can be achieved within 1 to 5 years
Intermediate term goals
74
Financial targets that can be achieved in less than a year
Short-term goals
75
Piercy it after employer withholding for taxes, insurance, union dues
Take-home pay/disposable income
76
Money left over after necessities are paid for
Discretionary income
77
Variable budgeting tool the places from the savings to cover emergency or higher than usual expenses
Revolving savings fund
78
When budget estimates different from actual expenditures
Budget exceptions
79
Detailed listing of plan expenses within a single budgeting classification like a vacation
Subordinate budget
80
Placing exact amounts and envelopes for each budgetary purposes
Envelope system
81
Difference between amount budgeted an actual mounts been to received
Budget variance

Financial Planning (3 decks)

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