2. Banking

3. Bank a financial business… thus, its 1 st goal is to make profit makes profit by creating loans and charging interest uses depositors’ money to create loans for others.

4. Savings an account for saving money withdraw, deposit and use an ATM card pays small rate of interest

5. Checking a money managing account writing, depositing and cashing checks direct deposit and automatic withdrawal ATM / debit card usually does not pay interest

6. Check a paper certificate that allows funds to be transferred from one checking account to another

7. Interest a percentage charged on borrowed money people with better credit scores will be charged less interest

8. Debit / Checking Card a card that electronically does the same as a check

9. FDIC Federal Depositors Insurance Corporation U.S. gov. insures all bank deposits up to $250,000.

10. Taxes

11. Provides revenue to govn’t to pay for gov’t provided services Fixing roads, bridges, dams, etc. Paying for schools, public education, community colleges, etc. Safety net services  Link cards  Welfare  Subsidized housing (Section 8, CHA, etc.)  Social Security  Medicare / Medicaid Department of Defense Pays gov’t employees  Elected officials  Gov’t dept staff  Military  Postal Service

12. Taxes Required payment to the government

13. Types of Taxes Sales Tax (IL and Chicago Revenue) Income Tax (U.S. and IL Revenue) Property Tax (Cook County Revenue)

14. Types of Tax Rates Proportional: everyone is charged the same percent regardless of income (IL income tax) Progressive: greater your income, higher your percent rate; the “ability-to-pay” principle (federal income tax) Regressive: flat rate, but takes a larger proportion from those with lower-incomes (Chicago sales tax)

15.  From $0 - $8,350 = 10%  From $8,351 - $33,950 = 15%  From $33,951 – $82,250 = 25%  From $82,251 – $171,550 = 28%  From $171,551 - $372, 950 = 33%  From $372,951 and above = 35%

16. Credit

17. access to borrowed money

18. Some Types of Credit car loans (car note) mortgages student loans retail loans credit cards

19. Important Terms re. Credit Internet Rate: the percentage charged on the money borrowed Credit Score: represents your reputation when it come to borrowing money “good credit”: good access to borrowed money “bad credit”: bad access to borrowed money