Personal Finance Terms

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Interest Rate

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The price paid for the use of money for a period of time. Usually is a percentage of what was originally borrow.

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Compound interest

Back

Interest that is paid on the original amount borrow AND the interest accumulated on an account.

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Account Balancing

Back

Creating equality between the totals of the credit (money one receives) and debit (what one pays) sides of an account. Goal is to have a surplus of $.

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Gross Income

Back

The individual's total pay from his employer before taxes or other deductions

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Net Income

Back

The individual's total pay minus deductions

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What are utilities?

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Necessities paid for separately than rent or mortgage i.e. electricity, gas, water, or sewerage.

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Mortgage

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A mortgage is a special type of loan used to buy a house.

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APR

Back

the annual rate charged for borrowing

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Salary

Back

The amount that one is paid annually by their job. Salaried employees get one rate for pay.

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Hourly Employee

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When a person works for a wage, or an amount paid by the hour that they work.