Virtual Business:Personal Finance

Basic Needs These are the things people cannot live without, such as food, clothing, and shelter.
Everyday Living What you experience on a typical day–whatever is a part of your routine, such as going to your job, attending church, cooking dinner, or walking your dog. Time management helps you make the most or everyday living.
Goals Things you hope to achieve in your life and work toward, getting a good job, completing your college degree, getting married, owning your own home, or running in a marathon.
Health The condition of your body and mind. A person can be in good health or in bad health, both physically and emotionally.
Moderation Not too much or too little of something; not going to an extreme in your pursuit of a goal.
Nutrition Obtained from food and used by our bodies for growth and maintaining good health.
Opportunity Cost what is lost by choosing one option instead of another. For example, the opportunity cost of choosing to take an afternoon nap might be a lost trip to the gym.
Sedentary A sedentary lifestyle is one that involves a lot of sitting around and not enough physical activity.
Stress Stress is a mental or physical tension caused by worry over problems we may be experiencing in life. Stress is a negative emotion.
Time as an Investment The idea that spending time on a positive activity such as exercise, pursuit of a hobby, or volunteering will pay off in the long run with better physical and mental health.
Time Management Organizing and using your time in a way that allows you to meet your daily needs as well as your short and long-term goals with as little stress as possible.
Values What individuals or cultures think of as important in life, as having meaning, or as being desirable.
Abilities Natural or acquired skills or talents.
Advancement in terms of a career, an effort one makes (or a milestone one achieves) in bettering one’s career.
Aptitude An inherent ability or talent
Benefits Entitlements, such as health or life insurance, available in accordance with a wage agreement, insurance policy, or program.
Career a chosen pursuit, profession, or occupation.
Career Path A planned progression of jobs within one or more professions throughout one’s working life.
Cost of Living The average cost of life’s basic necessities, such as shelter, food, and clothing.
Cover Letter a letter you send with your resume to provide more information about you.
Education The process of acquiring knowledge and developing skills, often through formal education resulting in a specialized degree.
Entry Level Indicates a job accessible to a person who is inexperienced in a particular field
Job A regular activity performed in exchange for payment
Resume A brief account of one’s work experiences and qualifications.
Salary A fixed compensation paid regularly for services.
Skills Proficiency acquired through training or experience.
Standard of Living A level of material comfort as measured by goods, services, and luxuries.
Landlord the company or individual that owns an apartment.
Lease A legal document signed by both the tenant and the landlord that contains the terms of the agreement, such as the names of the tenants, the rent amount, and the responsibilities of the landlord and the tenant.
Location the location of your apartment is an important safety consideration and also determines your ease of getting to work, buying groceries, etc.
Notice an amount of time required in advance if either the landlord or the tenant wishes to discontinue the rental agreement. This courtesy allows both parties time to make other arrangements.
Rent the payment, usually monthly, that the tenant pays to the landlord.
Security Deposit a sum of money usually equal to one month’s rent, held by the landlord to cover any damage to the apartment caused by a tenant.
Tenant the person renting the apartment.
Term the length of a rental agreement, usually a period of one year.
Unit one individual apartment. A large apartment building may contain 20 or more units.
Utilities items and services needed to make a house or apartment functional such as hot water, electricity, natural gas, phone service, and cable service
APR this stands for annual percentage rate, which is a number calculated by taking into account the total cost of the loan, including what the borrower will pay in interest; this makes it easier to compare different loan offers
Coupe a car with two front seats and a smaller backseat for occasional passengers. it usually has two doors but sometimes it has four
Collision Insurance This covers the car of the insured person and pays for repairs after an accident or cash compensation if the car can’t be repaired. This type of coverage is usually optional
Lease An agreement that gives one party the use of a commodity for a specified period of time and for a specified price.
Liability Insurance this compensates an injured party up to a certain amount outlined in the policy statement. This type of insurance ensures you will be able to pay for any damages you cause
Loan An amount of money given to the borrower for a set period of time. After the set time has passed, the money must be paid back plus the lending fee, called interest. Payments are normally made over a series of months.
Minivan a car that is designed for maximum passenger space. It has multiple rows of seats but often dosen’t offer significant towing power or offroad capabilty
No-Fault Auto Insurance A system under which drivers must have coverage for their own protection. It also limits the damages for which an injured party can sue. Under this system, after an accident both parties would be covered by their own insurance policies. Only some states use this system
Sedan A common type of car that has two rows of seats and a trunk. It can have two doors or four doors, but the backseat should be able to seat adults comfortably.
SUV (Sport Utility Vehicle) A car designed to have multiple rows of seats and significant towing power. Most also have the ability to drive off-road.
Comparison Shopping Looking for the same product in multiple stores to find the best price, or to find the best product.
Contract An agreement between a buyer and a seller.
Primary Need Something that you must have to live from day to day, like food, shelter, and clothing.
Recall The voluntary or involuntary removal of a dangerous product from the market.
Secondary Need Something that can help you improve your day to day life, like a computer, car, or television.
Value What you think the purchase is worth to you personally, taking into consideration how it will help to improve your life.
Want Something that won’t help you live from day-to-day, like jewelry, video games, and soda. Once you have met your primary and secondary needs, you can try to make room for some of these things in your budget.
Warranty The seller’s promise to fix or replace the product if something goes wrong.
ATM Automatic Teller Machine-a bank machine that gives out cash from your account and accepts deposits around the clock.
Balancing a Checking Account Calculations that are made to determine the difference between the payments from, and the deposits to, a checking account
Bank Financial institution at which you can get a checking account or savings account.
Bank Statement Mouthly printout from your bank that shows all transactions
Basic Checking Account A no-frills checking account that offers a low minimum opening deposit and reduced fees for students.
Check A debit against your checking account written on a paper form.
Check Cashing Service business that charges a fee to cash a check such as a paycheck. banks will provide this service for free to their customers.
Check Register The book in which you keep records of checks, deposits, debit card transactions, and atm withdrawals.
Debit Card Like a credit card, but directly attached to a checking account, and can be used with a pin to pay for items at a store.
Direct Deposit An automatic deposit of a paycheck without having to take a physical check to the bank.
Fees Service fees for use of the checking account, built into the service agreement.
Interest-Bearing Checking Account A checking account that pays interest on the balance.
Overdrafts Amounts withdrawn from your account beyond the money the account held.
Payday Loan A loan where a borrower gets a cash advanced based on his paycheck. These loans generally must be repaid on the next payday.
Bankruptcy When a debtors assets are sold to settle unpaid debts and the debtor is no longer responsiblle for further debt beyond what was recovered.
Certified Mail mail that gives the sender proof of receipt from the U.S. Postal Service
Credit History a summary of a person’s borrowing and repayment history
Credit Report a report on a person’s creditworthiness that includes identifying information, credit cards, late payments, bankruptcies, and savings balances
Fair Credit Reporting Act federal law giving constumers right to veiw and correct their credit information
FICO Expansion Score A creditworthiness score that, like the regular FICO score, has a scale of 300-850, but is based on nontraditional accounts and financial information sources and is designed for young persons, new immagrants, or others without a traditional credit history.
FICO Score Credit score from 300-850 that rates how likely a person is to fall 90 days behind in a payment.
Foreclosure when a bank takes back a property and auctions it off to recover the unpaid loan amount
Installment loan Loan with equal number of payments of the same amount over a fixed period of time.
Lien a promise to reclaim an item bought with loaned money if the loan is not repaid
Apprenticeship A learning period of up to five years including the job training (with pay) and additional coursework at night
Associate’s Degree A degree that generally takes two years of study and is awarded by a community, junior, or buisiness college.
Bachelor’s Degree An academic degree which usually takes four years to earn and is awarded by a college or university.
Career Ladder Upward movement from an entry-level job to the job that is a final goal
College A four-year institution of learning where students earn an undergraduate degree
Community College A two-year college that emphasizes career training, or a less expensive way to complete the first two years of college before transferring to a four-year college
Cooperative Education When a degree program is combined with an internship in a company as part of practical education in the field
Grants and scholarships Money to pay for college that does not need to be paid back.
Internship Time spent working for a company in an industry of interest. Can be paid or unpaid, and can last typically from six weeks to a year.
Occupational Training Programs These range from a halfday weekly dering high school to two year, full time programs spent learning a trade such as firefighting, medical technology, or it network management.
Student Loan Money borrowed to pay for education. This money must be paid back. The best loans have deferred interest. That means interest does not start building until the education period is complete.
University An organization of advanced education,that makes the appropriate amenities available for insruction and study and has the necessary certfication to award graduate or undergraduate degrees.
APR Annual Percentage Rate, or the interest rate that the user of a credit card will pay. The APR advertised by creditors varies and should be used to compare different credit card offers.
Credit Making purchases now and paying for them later (also known as borrowing!).
Credit Card A plastic card used to make purchases now and pay for them later.
Creditor Any bank or business that extends credit to others; a lender.
Debtor anyone who owes money; a borrower
Finance Charge A fee for borrowing money, added to a monthly credit card bill.
Interest Rate The fee, expressed as a percentage, a borrower owes for the use of a creditor’s money. At an interest rate of 10%, a borrower would pay $110 for $100 borrowed.
Introductory Rate A temporary interest rate, advertised as a low APR to entice customers to apply for a credit card. After the introductory period, the interest rate will increase to the regular APR.
Late Rate Additional fees that can be added to a credit card bill if the card holder fails to make at least the minimum payment by the due date.
Minimum Payment The smallest required payment that a credit card holder can pay on a monthly bill and still remain in good standing with the lender.
Principal The amount of money borrowed. On a credit card bill, The principal is the purchase price of all items bought with the card.
Apprenticeship A learning period of up to five years including the job training (with pay) and additional coursework at night
Associate’s Degree A degree that generally takes two years of study and is awarded by a community, junior, or buisiness college.
Bachelor’s Degree An academic degree which usually takes four years to earn and is awarded by a college or university.
Career Ladder Upward movement from an entry-level job to the job that is a final goal
College A four-year institution of learning where students earn an undergraduate degree
Community College A two-year college that emphasizes career training, or a less expensive way to complete the first two years of college before transferring to a four-year college
Cooperative Eduction When a degree program is combined with an internship in a company as part of practical education in the field.
Grants and scholarship money to pay for college that does not need to be paid back.
internship Time spent working for a company in an industry of interest. Can be paid or unpaid, and can last typically from six weeks to a year.
Occupational Training Programs These range from a halfday weekly dering high school to two year, full time programs spent learning a trade such as firefighting, medical technology, or it network management.
Account Transfer making an online transfer of money; for example, from a savings account to a checking account
fraud When a criminal uses trickery to convince someone to give up valuable information or items of value.
Identity Theft When a criminal opens a credit card with another persons name and social security number, charges merchandise, and leaves the victim with the unpaid bill. This can be multiplied as identities can be fraudulently sold, and others can continue to use someones good credit to get further credit cards and loans.
Internet Access Service that connects a computer to the internet. Can be done through a cable modem, through DSL or dial ip service over a phone line, or over Wi-Fi in coffee shops and on many college campuses.
Online banking Using the Internet and a banks website to keep track of band accounts, moving money from one account to another, and paying bills.
Password Secret word used, with the username, to access online banking. Banks usually have rules for passwords, such as they must be 6 to 12 characters long and have both numbers and letters.
Personal Information Important identifying data that lets your online bank know you ar who you say you are, such as date of birth, sociol security number, and mothers maiden. Never give out this information unless you are certain it is to your own bank and not a fraudelent Web site.
Phishing When a criminal sens an e-mail using a scheme to get you to divulge your personal informatioon. Contact your bank immediatly if an e-mail says you will lose your account unless you provide your username and password or any other personal information. It is important not to reply to these emails.
PIN (Personal Identification Number) A number used to access your account when used with a money card or debit card.
Recurring Payment Automatic payments a customer can set up,such as to pay for car insurance or cell phone service.These payments can happen every mouth,even though they are set up only once.
Username Account name used to access online banking.
1040EZ The quick tax most often used, in paper or online for those with unconplicated tax situations.
1099INT Report on interest income sent from the bank to both the IRS and the taxpayer for savings account interest.
1099MISC Report of income made to the IRS and the taxpayer for any money paid by the job, instead of as a salaried employee.
FICA Short for Federal Insurance Contributions Act, the name given on the paycheck stub for Social Security and Medicare taxes. The employee pays some of the FICA tax, and and the employer pays some of this tax for each employee. Social Security pays benifits for older people, people with disabilaties, and minor children and surviving spouses of deceased workers. Medicare pays for hospital insurance for those over 65.
Gross Income The total income, before deductions, made in a year.
Income Tax Tax paid to the state, federal, and local governments based on income earned over the past year.
Standard Deduction the amount of deduction given for those not claimed as a dependent on a parents taxes
Tax Audit A reveiw of a tax return by the Irs in which the taxpayer must show proof of all deductions, expenses, and income.
Tax Deduction A donation or expense that reduces the taxable income amount.
Tax Refund A check returning the taxpayers money to the taxpayer after tax retuns are filed and the over paid tax is determined.
Tax Table The table in the 1040EZ booklet showing levels of income on one side and the tax owed on the other side.
W2 Report sent from the eployer to both the IRS and the employee, showing gross income, total taxes paid, and total voluntary deductions.
W4 The withholding form each new employee fills out, stating the number of exemptions. the more exemptions listed, the less withholding tax will be taken from the paycheck.
Back End Load fees paid to the mutual fund company when selling a mutual fund
Dividends Quarterly payout of profits by a company to all shareholders.
Expense Ratios For a mutual funds, an annual percentage the fund takes as payment. Expense ratios of different funds can be compared to find the best value.
FDIC Insured The FDIC (Federal Deposit Insurance Corporation) is a gonvernment agency that nsures depositors’ money. Backs and savings and loan companies that are FDIC-insured pay a percentage of their deposits to the FDIC to pay for the insurance.
Front End Load Fees paid to the mutual fund company as an entry requirement into certain mutual funds.
Inflation Rise in prices that effectively makes cash have less buying power.
Saving Account A safe, low-return investment available from banks. There is generally no minimum deposit forthis type of account, making it perfect for kids and teens just starting out.
Year to Date Return (YTD) On a mutual fund statement, a comparison of how the fund has done comapared to its value on the first of the year.
Yield For a saving account, the percentage of interest earned annually. For a stick, the annual dividend divided by the share price.
Asset Class Seperate types of investments, such as stocks/stock mutual funds, bonds/bondfunds, money market accounts, and international stocks/international stock funds. Each asset class has typical risks and returns, and a certain investment within that class may perform better or worse than its peers.
Capital Gain When what you sell a stock for is less than what you originally paid for the stock, the difference is called a capital loss.
common stock A share in a company’s assets and profits. The ownership of a publicly traded company is split up into the shares of stock being traded and held.
Dividend Money paid by a corporation to each shareholder. typically given four times a year,these distributions of company profits can be used to reinvest in more shares of the company.
Money Market A mutal fund or account thtat invest in short-term, liquid investments. these funds generally pay better that a savings accountwith a bank, but less than a typical stock mutual fund. These funds are comsidered very low risk.
Mutual Fund A mutual fund is a pool of stocks, bonds,and other securities managed by an investment company. Individuals can buy shares of the fund and profit from its investment gains.
Private Corporation an incorporated business that does not trade shares of stock on an open market it is owned privately typically by a small number of people
Public Corporation An incorporated business owned jointly by all stockholders. Stockholders vote on who will oversee the company profits are paid out in the form of dividends.
Rate of Return The annual amount of money an investment makes, given as a percentage. For example, a $100 investment that is worth $112 the next year had a 12% return.
Risk The change that an investment may lose value. Less risky investments have a lower rate of return.
Return Monetary increase that an investment makes. If an investment loses value, It is called a negative return.
401(k) plan a type of employer-sponsored retirement plan in which money is contributed on a pre-tax basis and all earnings are tax deferred
Annuity An investment contract made with the issuer (e.g, insurance company); types: immediate, deferred, fixed variable.
Defined- benefit plan a type of retirement plan, usually a pension, in which the payment amount is guaranteed
Defined-contribution plan a types of retirement plan in which the amount invested in the plan is controlled by the employee, with no guarantee of benefits
Employer-sponsored retirement plan a savings plan for retirement that is offered through a company’s benefits package; contributions are usually matched by the company
IRA (Individual Retirement Account) A type of retirement-saving plan that is not usually done through an employer; traditional IRAs are tax deductible and earnings tax deferred.
Keogh plan A retirement savings plan for self-employed professionals or owners of small businesses;it affords the same tax benefits as a 401(k).
Pension A fixed sum paid regularly by an employer to an employee after retirement.
Retirement Permanent withdrawal from the workforce
Roth IRA This type of Individual Retirement Account is not tax deductible, but may not be subject to income tax upon withdrawal.
Social Security A united States government program established in 1935 that includes a retirement benefit for citizens; it is funded by payroll tax.

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