Financial Literacy Terms

This is a financial arrangement in which money is borrowed for a purchase and paid back at a later date. It allows consumers to make purchases that they wouldn’t be able to afford if they had to pay the full price in one installment.

• Credit Card

• Credit

• Loan

• Credit Score

This is when you attempt a transaction that would exceed your account balance, but the financial institution extends you a temporary line of credit to allow the transaction to take place. You are then expected to not only bring your account balance back up to a positive number, but also pay a fee for the service.

• Withdraw

• Fees

• Overdraft

• Interest

This is a plan for using income to meet financial obligations. It tracks how much income a person receives and details how that money will be allocated to pay for expenses, build savings, and meet financial goals.

• Financial Plan

• Tracker

• Spending Plan

• Budget

This is the money that a borrower owes to a lender.

• Debt

• Cash

• Credit

• Interest Fees

This type of card immediately withdraws funds from the user’s bank account.

• Check Card

• Credit Card

• Debit Card

• Player's Card

This is an Automated Clearing House (ACH) transaction, where your payment is electronically transferred to your chosen bank account.

• Paycheck

• Employment Payment

• Government Transaction

• Direct Deposit

This type of interest never changes during the life of a loan. No matter how long the loan period is or the economic conditions, you will pay the same interest rate.

• Accrued Interest

• Annual Percentage Rate

• Variable Interest

• Fixed Interest

This is an interest rate that changes periodically based on economic conditions.

• Variable Interest

• Fixed Interest

• Annual Percentage Rate

• Simple Interest

This 9-digit number can be found on the bottom left portion of a check.

• Check Number

• Checking Account Number

• Routing Number

• Social Security Number

An account that is an extremely liquid type of deposit account found at most financial institutions.

• Savings Account

• Retirement Account

• Checking Account

• Personal Bank Account