Household budgets, savings, debt, and cash flow.
41 terms
family budget
A plan for dividing monthly income into spending categories before the money is spent.
emergency fund
Savings set aside specifically for unexpected costs, kept separate from the daily account.
cash flow
The difference between money coming in and money going out in one period.
negative cash flow
A condition where expenses are greater than income in a period.
expense category
A grouping of expenses in a budget, such as food, transportation, or loan installments.
fixed expenses
Expenses whose amount is relatively the same each month and hard to avoid.
variable expenses
Expenses whose amount changes each month, such as shopping and recreation.
lifestyle
Spending patterns for consumption that are not basic needs.
basic needs
Essential spending for food, housing, health, and basic education.
wants
Spending that can be postponed without disrupting basic needs.
financial goal
A money target with a clear amount and deadline, such as a child's school fund.
short-term goal
A financial goal to be achieved in less than one year.
long-term goal
A financial goal with a deadline of several years, such as a pension fund.
savings
Money set aside and not used for current consumption.
automatic savings
Regular transfer of funds to a savings account without manual action.
piggy bank
A place to keep loose change or daily savings at home.
joint account
An account used jointly by family members for household expenses.
separate accounts
Personal accounts not mixed with household money.
debt
An obligation to pay a sum of money to another party due to a loan.
installment
A regular debt payment in an agreed amount and on an agreed schedule.
interest
An additional cost paid by a borrower on money borrowed.
compound interest
Interest calculated also on the previous period's interest, so the balance grows faster.
fixed interest
A loan interest rate that does not change for a certain period.
floating interest
A loan interest rate that can rise or fall following the lender's policy.
effective interest
Interest calculated on the remaining loan principal, not on the original principal.
flat interest
Interest calculated on the original loan principal throughout the tenor.
tenor
The length of time a loan must be repaid according to the agreement.
loan principal
The amount of money borrowed before adding interest and other costs.
early repayment
Paying off debt ahead of schedule, usually with certain fees.
late payment fee
An extra charge applied because an installment is paid past its due date.
due date
The final deadline for paying an installment or bill.
debt ratio
The comparison of total installments to monthly income.
robbing Peter to pay Paul
Borrowing new money to pay old debt, making the burden pile up further.
online loan
An app-based loan whose license and interest must be checked before use.
credit card
A buy-now-pay-later payment tool whose bill is paid off each month.
minimum payment
The smallest amount that must be paid so a credit card is not considered overdue.
expense record book
A daily record of money in and out to monitor spending habits.
education fund
Money set aside specifically for children's school costs.
retirement fund
Money gathered so living needs remain met after stopping work.
life insurance
A product that provides compensation to the family if the breadwinner dies.
net income
The money received after tax and other deductions.
