Personal Finance Midterm

Front

What is disability insurance?

Back

Disability insurance is a type of insurance that pays a portion of your income if you cannot work due to a health condition or injury.

Front

What is the key difference between saving and investing?

Back

Saving is for emergencies and goals, while investing is for long-term wealth.

Front

How can you make an informed decision about a purchase?

Back

Read reviews from other consumers.

Front

What is a federal student loan?

Back

A federal student loan is money borrowed through a government program to pay for education.

Front

What is a grant in the context of education funding?

Back

A grant is money received from the government or other organizations that does not need to be repaid, often based on financial need.

Front

What is the purpose of a scholarship?

Back

A scholarship is financial aid awarded to a student based on academic or other achievements, which does not need to be repaid.

Front

What is the role of a budget in personal finance?

Back

A budget is a plan that outlines expected income and expenses, helping individuals manage their finances effectively.

Front

What does it mean to invest?

Back

Investing involves putting money into financial schemes, shares, or property with the expectation of achieving a profit.

Front

What is the importance of an emergency fund?

Back

An emergency fund is savings set aside to cover unexpected expenses, providing financial security.

Front

What is the difference between fixed and variable expenses?

Back

Fixed expenses remain the same each month (e.g., rent), while variable expenses can change (e.g., groceries).