Investment Terms

Investment Terms

Basic Terminology

FDIC

Federal Deposit Insurance Corporation

deposit insurance enables consumers to confidently place their money at FDIC-insured institutions across the country.

Savings

•  the money a person has left over when they subtract their consumer spending from their disposable income over a given time period.

• It can increase depending on the input of the consumer.

Savings Account

• a legal amount that saves the money that you input in.

• Can increase if left untouched.

• Increases during the duration, time and percentage negotiated between the banks terms and consumers agreeance.

Treasury Bill or T-Bill

• Money given from the Department of Treasury

• Sort of like a certificate of deposit, except it is from the government, deeming it more safe.

• Example: Deposit 3500-a year later- receive 3900= $400 interest.

Inflation

When a price goes up, which makes the value of the dollar decrease.

Example: what costs $1.08 today will cost more next year based on the inflation rate, thus making your dollar less valuable.

Money Market Account

• deposit account that pays interest based on current interest rates in the money markets. 

• The interest rates paid are generally higher than those of savings accounts and transaction accounts.

• The minimum balanceis usually higher then a normal savings account would be.