Tips and Tools For Financial Success - Newton Free Library

Interest: A percentage of your balance that the bank pays you or an amount of money for keeping your
money at that bank or the amount of money a financial institution charges for letting you use its money.
Investment: A long-term savings option that you purchase for future income or financial benefit.
Joint Account: A deposit account owned by two or more people and titled jointly in the co-owners’
names only, with no beneficiaries.
Loan: Money you borrow from a bank with a written promise to pay it back later.
Long-Term Care: Care or help with daily activities for those with a chronic illness or disability.
Minimum Balance: A certain balance that banks might require you to have to open an account, earn
interest, or avoid fees.
Money Market Account: An account that usually pays a higher rate of interest, and it usually
requires a higher minimum balance to earn interest than a regular savings account does. You can make
deposits and withdrawals.
Money Order: It is similar to a check. It is used to pay bills or make purchases when cash is not accepted.
Mutual Fund: A professionally managed collection of money from a group of investors. A mutual fund
manager invests your money in some combination of various stocks, bonds, and other products.
Net Income: Gross income minus deductions such as Social Security and other taxes.
Non-Deposit Investment Products: Products including stocks, bonds, mutual funds, and annuities.
The FDIC does not insure these products.
Payday Loan: A short-term loan. The loan service cashes the check on your payday, at which time
your loan is paid in full.
Payroll Deduction Individual Retirement Arrangements (IRA): An employee establishes an
IRA (traditional or Roth IRA) with a financial institution and authorizes a payroll deduction for the IRA.
Penalty APR: The terms of your credit card agreement may provide that the creditor will permanently
increase the interest rate on your credit card by a large amount if you do not pay your credit card bill on
time, or if you exceed your credit limit.
Pharming: When criminals seek to obtain personal or private information by making fake websites
appear legitimate.
Phishing: When criminals send out unsolicited emails that appear to be from a legitimate source in an
attempt to trick you into divulging personal information.
Predatory Lending: Use of certain marketing tactics in making loans, such as abusive collection
tactics and loan terms that deceive borrowers into thinking they are receiving better loan terms than
they really are.
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