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Liquidity - ✔✔ The ability to convert an asset to cash quickly
Products that are liquid - ✔✔ Stocks and Money Market
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Gift Cards - ✔✔ a card that is given as a gift with a specified amount of money. There is a monthly inactivity fee that may begin after 12 months.
Discretionary income - ✔✔ The amount of an individuals income that is left for spending investing or saving after taxes and personal necessities.
Money orders - ✔✔ a certificate that allows the stated payee to receive cash on-demand, usually issued by government and banking institutions.
Opportunity Cost - ✔✔ The cost of an alternative that must be forgone in order to pursue a certain action.
Who is the most hurt and the least hurt with inflation? - ✔✔ Winners-
Fixed-rate mortgage holders, Auto-loan holders, Investors in stocks
Losers-
The American economy, Savers, Credit card debt holders, Consumers
Pay Yourself First - ✔✔ PYD: automatically route your specified savings contribution from each paycheck at the time it is received.
CD - ✔✔ certificate deposit- it is a time deposit offered at financial institutions - penalty if cashed before maturity
Institutions that give loans - ✔✔ banks, credit unions, pawnshops, finance companies, payday lenders, tax preparers.
Which institutions charge the highest interest rates on loans? - ✔✔ pawnshops, payday lenders, tax refund lenders, finance companies
Overdraft protection - ✔✔ a line of credit that banks offer to their customers to cover their overdrafts. Ovedraft protection kicks in when a customer writes a check for more than the amount in their account
Compound interest - ✔✔ Interest calculated on the initial principal and also on the accumulated interest of previous periods of a deposit or loan
Liquid financial products vs. products that are less liquid: - ✔✔ savings and checking accounts are most liquid, certificate of deposit and money market accounts are less liquid.
Rule of 72 - ✔✔ how long will it take to double an investments? Divide 72 by the interest rate to be earned: 72 divided by 3% interest = 24 years.
Repayment of student loans - ✔✔ 6 month grace period(after leaving school) before you start making payments.
Tax anticipation loans - ✔✔ is a short term consumer loan in the United States provided by a third party against an expected tax refund for the duration it takes the tax authority to pay the refund.
Truth in Lending Act - ✔✔ A federal law enacted in 1968 with the intention of protecting consumers in their dealings with lenders and creditors.
Consequence of paying the minimum payment due on a credit card bill or paying a bill late - ✔✔ Interest will continue to grow and you will have to pay a late fee on late payments.
Debt to Credit Ratio: - ✔✔ - its the amount of credit your using
Credit Reports - ✔✔ a detailed report of an individuals credit history prepared by a credit bureau and used by a lender to in determining a loan applicants creditworthiness.
Three leading credit reporting agencies - ✔✔ Equifax, TransUnion, Experian
Collateral - ✔✔ collateralize loans use an item like a house to guarantee the loan
Pawnshops - ✔✔ Collateralize loans the loan is collateralized by the item you bring in order to get a loan from the pawnshop [Show Less]