Foundations in Personal Finance Chapter 1 Part 3

Most Americans avoid the use of credit when it comes to buying big-ticket items like a car or furniture for their home.

• True

• False

Learning the language of money is not that important because you will be able to depend on financial planners to manage your money.

• True

• False

Having debt keeps you from building wealth.

• True

• False

Expensive houses and new cars are a true indication of wealth.

• True

• False

When developing a personal financial plan, one of the first things you should do is assess your current financial situation. This includes your income, assets and liabilities.

• True

• False

A person or organization that uses a product or service

• Borrower

• Consumer

An obligation of repayment owed by one party to a second party

• Debt

• Ownership

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

• Credit

• Annual fee

The knowledge and skill set necessary to be an informed consumer and manage finances effectively

• Financial literacy

• Budgeting

A fee paid by a borrower to the lender for the use of borrowed money

• Bills

• Interest