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Finance Review FCS

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  • What is the difference between gross pay and net pay?
    Gross pay is the amount earned before taxes and net pay is the amount earned after taxes
  • What is the relationship between risk and return?
    Higher risk = Higher return
  • What is a 1040
    A tax form that is filled out to determine if taxes are owned or will be refunded by the government
  • What are ways to protect your identity online?
    Be careful what websites you visit, do not share personal information online, be wary of clicking unknown links, use strong, unique passwords
  • What is a deductible?
    The amount required to pay before insurance will begin paying for services
  • What is a stock?
    A small part ownership of a company
  • What is a diversified portfolio?
    When a portfolio of assets has many different types of investments
  • What is a bond?
    A government or company loan that you provide to a company for a return on a specified date
  • What is a premium?
    The monthly rate paid to the insurance company to be insured
  • Why should you invest for retirement sooner than later?
    Your money will have more time to grow and more will be available when you retire
  • When are W-2's required to be sent?
    By the end of January
  • How much unearned income is required to file taxes?
    $1,100
  • What two types of investments are considered "high risk"?
    Real estate and speculative investments
  • When is tax day?
    April 15th
  • What is the difference between saving and investing
    Investing is when you spend money in hopes it makes a return, saving is storing money for later use
  • What is risk pooling?
    When insurance companies combine the amount paid by customers to help pay for the few people who need to use the services
  • How much money do you need to make a year to be required to file taxes?
    $12,400
  • What is an index fund?
    A large collection of similar stocks and bonds grouped together
  • What does "liquidity" mean?
    How easily an asset can be turned into cash
  • What are FICA taxes?
    Social Security and Medicare
  • What two types of retirement accounts are tax advanged?
    Traditional IRA and 401(K)
  • What is inflation?
    The rise of the cost of goods and services over time
  • What is a coverage limit?
    The maximum amount an insurance company will pay for services
  • Why is it important to have auto insurance?
    To protect yourself from other uninsured driver and to help pay for expenses related to an accident
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