Finance Vocab 1-4 & 12

The dollar value of a person’s liabilities is larger than the value of their assets.

The dollar value of a person’s assets is greater than the dollar value of their liabilities is

Something owned offered as security on a debt; if the debt is not repaid as agreed, the item is forfeited to the lender

A list of your investments

An asset that can be easily bought or sold is a liquid Asset

The additional cost a lender charges for borrowing their money

A qualified retirement savings plan offered by a company to its employees who contribute money from their gross payment

The amount you earn before taxes and other payroll deductions

An asset that increases in value over time

A description of the investing strategy the mutual fund management company will use to invest your money

The amount by which the value of a person’s assets exceeds or falls behind the values of their liabilities.

A statistical number used to represent a consumer’s creditworthiness.

Annuity that offers low guaranteed rates of interest and fixed income payments in retirement

What is a person or entity that charges borrowers interest rate above an established legal rate.

Measures the gain or loss generated or an investment relative to the amount of money invested

Money owed to a person or comany is an expense

A person or organization that uses a product or service.

The percentage of principle charged by the lender for use of its money is

All the financial decisions an individual or family member make in order to earn, budget, save, spend, and give money

The average rate of growth for an investment over time; often expressed as an annual figure

An Asset is anything that is owned by an individual, including money in the bank or investments.

Cash-flow plan that assigns and expense to every dollar of your income to zero is a zero-based budget

Concept that an amount of money is worth more today than in the future due to earning potential

The granting of a loan and the creation of debt; any form of deferred payment.

An asset that loses value over time, such as a car that’s worth less every year

A legal claim (or right to own) against an asset until the debt (loan) is repaid

A distribution from the net profits of a company to its shareholders is diversification

When prices in a financial market are on the rise or expected to rise is a bull market

A company that collects credit rating information and makes it available to creditors.

The practice if dividing the money a person invests among different types of investments in order to lower risk

The increase in value of a home over time; the difference between the amount owed and what the home could be sold for

Relationship of expected return (profit you expect to make) compared to the amount of risk (amount you stand to lose)

When the value of an asset falls below what is owed on it

The cost of goods or services; money paid out is an expense