Personal Finance Vocabulary Review

Tax that increases as your income increases Progressive Tax

Tax rate that decreases as your income increases Regressive Tax

Tax that stays the same regardless of income levels Proportional Tax

Bill that is paid to get insurance Premium

Portion of insurance claim that must be paid by policy holder Deductible

Insurance that pays out on your death to family members Life Insurance

Insurance for doctor visits and medical expenses Health Insurance

Insurance that pays out when you are injured Disability Insurance

Financial institution that is owned by stockholders and offers checking, loans, savings Commercial Bank

Financial institution owned by account holders that offers credit, checking, savings Credit Union

Likelihood that an investment will fail Risk

Reward or increase on investment Return

Interest charged or paid only on principle Simple Interest

Interest charged or paid on principle and any other money in account Compound Interest

Initial amount borrowed or invested Principal