Personal Finance NGPF Flashcards

Study Notes

Personal Finance Key Terms

Net Pay: The amount received in a paycheck after all deductions such as taxes, retirement contributions, and health insurance are taken out.
Gross Pay: The total earnings before any deductions are made; it includes wages, bonuses, and overtime pay.
Interest: The fee charged for borrowing money, typically expressed as a percentage of the principal amount over time.
Checking Account: A deposit account held at a financial institution that allows for frequent withdrawals and deposits, used primarily for everyday transactions.
Debit Card: A financial card that deducts money directly from the checking account when a purchase is made, providing instant access to funds.
Credit Card: A card that allows individuals to borrow money up to a certain limit to make purchases, with the obligation to repay the borrowed amount along with interest later.
Principal: The initial sum of money that is borrowed or invested, separate from interest or profits.
Loan Term: The specified duration in which a borrower is required to repay a loan, which can vary depending on the lender and type of loan.
Savings Account: A bank account intended for accumulating savings rather than for daily transactions, often earning interest on the deposited funds.
Compound Interest: Interest calculated on the initial principal and also on the interest that has been added to the principal, resulting in interest-on-interest over time.
Simple Interest: Interest calculated solely on the principal amount of a loan or investment, without compounding effects.
Invest: The act of allocating resources, usually money, to an asset with the expectation of generating income or profit over time.

Description

Test your knowledge of key personal finance terms with these flashcards. Each card provides a definition to help you understand concepts like net pay and interest. Perfect for anyone looking to enhance their financial literacy.