Math Models Review

Front

This type of interest "creates a mathematical explosion," and it can make you wealthy over time, or keep you in debt for a long time.

Back

compound

Front

Cost of credit expressed as a yearly percentage

Back

APR

Front

The cost of borrowed money, usually expressed as a percentage.

Back

interest

Front

401(k), IRA, and Roth IRA are all examples of a __________ account.

Back

Retirement

Front

This term refers to the original amount of a loan OR the original amount of money invested.

Back

Principal

Front

This is an obligation of repayment, usually including principal plus interest; any time you owe someone money.

Back

debt

Front

Term that applies to the ability to buy something now and pay for it later over a period of time (usually with having to pay a finance charge and/or the addition of interest).

Back

Credit

Front

Which budget item will most likely take up the largest percentage of your income at 25-30%? Options: transportation, housing, groceries, saving/investing

Back

housing

Front

What is a budget?

Back

A financial plan that defines expenses for a period of time.

Front

How many months of expenses should be set aside for an emergency fund?

Back

3-6 months