Why do high school and college students have to learn trigonometry, calculus, Latin and other complex subjects but not financial management? Finance is something that is increasingly becoming vital in today’s society.
I have an interesting relationship with money. Sometimes I’m a saver and pinch every penny. Other times, my lack of self control gets the best of me and I go on a bender indulging in the latest fashion trends. My relationship with money isn’t always healthy and to be honest, isn’t very well informed.
I was never taught the tools, terms, or methods in school. And I don’t think I’m alone. When we don’t know financial terms, and ignore them or look away, it’s impossible to ask the proper questions to determine a financial strategy. It’s time to become financially literate!
To help us all out, we put together a below guide that will help you sort out all the language when renting a new apartment, signing up for a new credit card, paying back your student loans, and a plethora of other things.
Credit line: maximum loan amount the borrower can have.
Cash flow: the amount of money in and out of your account.
Interest rate: extra money a borrower pays a lender to access money.
Capital expenditure: amount spent to buy or improve a long-term asset. (Ex. If you go to school on the side to learn more skills, with a goal to generate more income)
401(k): offered by companies, these are plans to help you save for retirement.
APR: short for annual percentage rate, basically this is how much interest you’re paying on the money you borrow. Opt for things with low APR, to avoid paying more money than you spent.
While we’re on the subject of money, you can check these banks out to open a new checking account – they’re giving away free money for doing so.