Financial Literacy Vocabulary: Part 1

Which term describes money being automatically taken from a bank account on a set schedule to pay bills without writing a check?

• Budget

• Automatic Bank Deduction

• Electronic Payments

• Debit Card

What does it mean to borrow?

• To permanently take money from someone with no plan to return it

• To temporarily take money or an item with a promise to return it, often with an extra fee or interest

• To list all money spent during a time period

• To pay using physical coins and paper bills

Which option best describes a budget?

• A card that lets you borrow money for purchases

• A plan showing money coming in and going out to manage spending and save

• A written order telling a bank to pay someone

• Special tickets or codes that give you a discount

Which payment method takes money out of your bank account immediately when you make a purchase?

• Credit Card

• Debit Card

• Check

• Coupons

A credit card allows you to make purchases by borrowing money that must be paid back later, often with added interest. Which statement is a smart use of a credit card?

• Using it for everyday purchases you cannot afford and ignoring the bill

• Using it for a necessary purchase and paying the bill in full on time

• Sharing the card with friends to split costs

• Using it only because it removes money immediately from your bank

Which item lists all the money you have spent during a specific time period?

• Expense Statement

• Financial Planning Tool

• Budget

• Electronic Payments

Which tool helps you organize and manage your money more effectively?

• Charitable Contributions

• Financial Planning Tool

• Cash

• Discounts

Which term refers to physical items that can be bought and sold, like toys, clothes, or electronics?

• Goods

• Services

• Savings

• Profit

What is income?

• Money set aside for future use

• The money you earn from working, allowances, or other sources

• An extra percentage added to the price of items

• The total value of what you own minus what you owe

Which statement best defines interest?

• A document showing what you own and owe

• The extra money you pay when borrowing or earn when saving, calculated as a percentage of the original amount

• Money paid to use something you don't own

• Big, expensive items that require planning