Personal Finance Final Exam Study Guide Pt. 1 – Flashcards
65 test answers
Unlock all answers in this set
Unlock answers 65question
Paper Paycheck
answer
Method of payment- access funds by cashing or depositing a check.
Unlock the answer
question
Direct Deposit
answer
Method of payment- wages deposited directly into depository institution account
Unlock the answer
question
Payroll Card
answer
Method of payment- wages electronically loaded each payday onto a plastic card kind of like a debit card.
Unlock the answer
question
Payroll Deductions
answer
Gross Income-Deductions = Net Income
Unlock the answer
question
Income Tax
answer
Tax on earned and unearned income; higher income=more tax paid
Unlock the answer
question
Payroll tax
answer
Tax on earned income (only) that supports social security and medicare programs
Unlock the answer
question
W-4 Form
answer
A form completed by an employee to indicate their tax situation (exemptions, martial status, how many dependents they have, etc) to the employer. It tells the employer the correct amount of tax to withhold from their paycheck.
Unlock the answer
question
Employee Benefits
answer
Products/services that add extra value for employees beyond wages earned. EX: Workers' compensation, unemployment insurance, etc
Unlock the answer
question
Workers' Compensation
answer
Helps pay medical expenses if injured on the job.
Unlock the answer
question
Unemployment Insurance
answer
If you lose your job due to no fault of your own you can file for this. It provides income while seeking new employment. (Govt. Program)
Unlock the answer
question
Pay Stub
answer
Outlines the deductions made to wages
Unlock the answer
question
Job
answer
An activity through which an individual can earn money. Most have several throughout their lifetime.
Unlock the answer
question
Career
answer
An occupation or profession requiring special training- lifetime journey of building and applying skills, knowledge, and experiences in paid employment positions.
Unlock the answer
question
Human Capital
answer
Skills, knowledge, and experiences possessed by an individual. The result of investing in yourself.
Unlock the answer
question
Transferable Skills
answer
Versatile skills that are applied to both personal and professional roles. (Listening, problem solving, etc;)
Unlock the answer
question
Occupation
answer
Grouping of jobs that perform similar tasks
Unlock the answer
question
Industry
answer
Group of establishments that produce similar products or provide similar services.
Unlock the answer
question
Career Cluster
answer
Grouping of occupations and industries based on the knowledge and skills required- helps students prepare for employment.
Unlock the answer
question
Cost of living
answer
Average cost of basic necessities of life
Unlock the answer
question
Social Capital
answer
Access a person has to social relationships that can provide resources (a benefit of being in a community)
Unlock the answer
question
In-Kind Income
answer
The provision of a product or service instead of money (a place to live for free, a ride if car breaks down, etc)
Unlock the answer
question
Non-Profit Organization
answer
Organization that exists to benefit others through human service, conservation, religious, or other charitable purposes. (Ex girl/boy scouts, salvation army, etc)
Unlock the answer
question
Government Programs
answer
Programs/activities sponsored or administered by local, state, or national governments.
Unlock the answer
question
SNAP- Supplemental Nutrition Assistance program
answer
Designed for Low income families, funded by federal gov, purpose is to provide money to purchase nutritious food.
Unlock the answer
question
TANF- Temporary Assistance to Needy Families
answer
Designed for low income families with children. Temporary program that provides money, job training, and other support to help achieve self-sufficiency.
Unlock the answer
question
Medicare
answer
Helps pay for health care for seniors 65+
Unlock the answer
question
Medicaid
answer
Provides insurance, especially medical care for low-income children, pregnant women, people with disabilities, elderly needing nursing home care, etc.
Unlock the answer
question
Earned Income Tax Credit
answer
Designed for low and moderate income adults who have worked for pay- provides money to adults who file a tax return.
Unlock the answer
question
Overdraft Fee
answer
If you withdraw more money from your account than is available you pay this.
Unlock the answer
question
ATM Fee
answer
Charge for using an ATM that belongs to another depository institution.
Unlock the answer
question
Maximum Balance Fee
answer
Fee charged if you go below minimum balance that can be in account.
Unlock the answer
question
Contactless Payment
answer
Transaction completed with no physical connection between payment device and point of sale (POS)- wave a card in front of a sensor
Unlock the answer
question
Online banking
answer
Complete transaction from secured internet site- access account anytime, anywhere online.
Unlock the answer
question
Mobile Banking
answer
Apps that many depository institutions have developed that allow online banking access for devices like smartphones and tablets.
Unlock the answer
question
Checking Account
answer
Provides quick access to funds for transactions. Use deposited money any time by writing checks, debit card, withdrawing cash, etc.
Unlock the answer
question
Transaction/Savings tools, credit, safe deposit box, financial advice, special needs payment instruments.
answer
Services Offered by Depository Institutions
Unlock the answer
question
NCUA (National Credit Union Administration)
answer
Provides insurance protection for CREDIT UNIONS. Each depository insured against loss up to max of $250,000
Unlock the answer
question
FDIC (Federal Deposit Insurance)
answer
Govt agency- insures DEPOSITORY INSTITUTIONS that have been elected for their coverage loss. $250,000 per depositor, per insured institution, for each account ownership category.
Unlock the answer
question
Credit Unions
answer
Depository Institution that is not for profit (owned by members) and all members share a "Common Bond"
Unlock the answer
question
Commercial Bank
answer
Depository Institution that is for profit and open to anyone. Largest depository institution.
Unlock the answer
question
Depository Institution
answer
Businesses that provide financial services. There are two types- commercial banks and credit unions.
Unlock the answer
question
Gross Income
answer
Money Earned before tax deductions
Unlock the answer
question
Net income
answer
Money left after deductions
Unlock the answer
question
Liability
answer
Debt/Obligations owed to others- loans (mortgage, automobile, student, etc) and balances on credit card/$ owed to others
Unlock the answer
question
Investment Assets
answer
Financial Assets purchased with the hope that they will appreciate in value and generate income to sell at a higher price in the future.
Unlock the answer
question
Tangible Assets
answer
Personal property items (home, car, electronics, furniture, etc)
Unlock the answer
question
Monetary Asset
answer
Quickly/easily converted to cash ($ in checking and savings accounts)
Unlock the answer
question
Assets
answer
Items of monetary value that a person owns. 3 Categories- monetary, tangible, investment
Unlock the answer
question
Statement of Financial Position
answer
Describes an individual/family's condition on specific date by showing assets, liabilities, and net worth. Shows what your financial position is today.
Unlock the answer
question
Net Worth
answer
Measure of financial wealth. Assets- Liabilities= net worth
Unlock the answer
question
Spending Plan
answer
Plan for future- allocate $ to each category- plan for how much to spend in next month. Helps you figure out what your future money management plan will be.
Unlock the answer
question
Income and Expense Statement
answer
Lists/summarizes income/expense transactions in specific amount of time (usually 1 month or 1 year). Shows how you managed money in the past.
Unlock the answer
question
SMART Goals
answer
Specific, measurable, attainable, realistic, and time bound- helps you create all parts of a goal.
Unlock the answer
question
Financial Planning
answer
Managing $ continuously through life in order to reach financial goals.
Unlock the answer
question
Financial Goals
answer
Specific objectives that are accomplished through financial planning. Help guide short/long term spending decisions.
Unlock the answer
question
5 Well-Being Domains
answer
Physical Intellectual Social Emotional Financial
Unlock the answer
question
Opportunity Cost
answer
The value of the next best alternative that must be forgone as a result of a decision... loss of potential gain from other alternatives when one alternative is chosen.
Unlock the answer
question
Trade-Off
answer
Giving up one thing for another
Unlock the answer
question
Wants
answer
Desire for goods and services that can increases quality of life but are not absolutely necessary for survival
Unlock the answer
question
Needs
answer
Goods/Services required for survival
Unlock the answer
question
Value
answer
Something desirable/important to an individual
Unlock the answer
