a legally recognised form of payment.
something that can be used to value goods and services (price)
unit of account
means of exchange
store of value
something that allows goods and services to be traded without the need of a barter system
any assests whose 'value' can be used now or used at a later date
childhood, adolescence, young adult, middle age, and old age
FN- limited needs, reliant on parents, purchase sweets & toys.
I- pocket money from parents, spent on non-essentials, encouraged to save.
FN- want independence, less reliant on family, start socialising away from home.
I- main money from parents, may look for a job, cash as gifts + save for larger purchases.
FN- university/early career, more independent, renting/buying cars or homes, starting a family/getting married.
I- student loans, job & mortgage, eligible for credit cards.
FN- support family, improve lifestyle, save for the fututre.
I- paying mortgage, paying pension, high income & expenses.
FN- fewer dependence, fewer financial needs, may downsize.
I- no mortgage payments, income from a pension no salary.
money owned to someone else
when an individual or organisation legally states its inability to repay debts.
the ability to meet day to day expenditures and repay debts.
maintain good credit rating
avoid falling into debt
avoid legal action
banks automated clearing service
clearing house automated payment system
A type of bank account that keeps your money secure and helps you manage your finances.
-used by people with poor credit ratings
-no overdraft available
-additional benefits e.g.
breakdown cover, cashback on purchases, insurence
-recieve a debit card
-intrest free overdrafts
-railcards or discounts
where the borrower agrees to purchase an asset in regular instalments.
pros: you can spread the cost over a fixed term, intrest rate doesnt change.
cons: monthly payments are based on credit score, costs more overall.
borrowing money that you dont have through your current account.
pros: immediate access to extra funds if needed
cons: intrest is charged
borrowing a set amount of money for amspecific reason
pros: cost is clear up front, anle to borrow bigger amounts than a credit card
cons: possible fees/penalties that can drive up the cost of borrowing.
a long term loan to fund the purchase of an asset, usually paid back over a long period of time.
pros: your remain the legal owner of your property, usually easily approved.
cons: if you cant keep up with payments you endup losing your asset.
a type of loan where the money you spend is actually borrowed from the card provider.
pros: helps you build a credit history, protection against fraud.
cons: intrest is charged, easy to overspend, there are late fees.
a short term source of finance with very high intrest fees, usually only used in emergancies.
pros: quick access to funds, an eassy application and approval process
cons: steep intrest rates, short repayment periods, doesnt help build your credit.
-offers tax free intrest
-tends to be a limit
-you can only have one active ISA
-somewhere you can put your money so it can grow in value
-has an intrest rate
PB are investment product issued by national savings and investment.
-monthly price draw where you can earn between £25-£1million
-the money you put in is secure
gives your part ownership of a business which allows you to benefit from their success in form of payment (diveidents)
-value of share can go up or down + you can sell these shares
-you pay into a scheme where youll earn back money later on once you retire.
-you earn intrest on it
pros: low risk, secure, allows peace of mind, intrest payments
cons: inflation can impact intrest rates + the likelihood of you spending or saving
pros: potential of earning back more than you invest, much higher rate of return compared to savings, opportunities
cons: some/all investment can be lost, no garantee of return