43014
| Question | Answer |
| Inflation | A rise in prices, which means that the purchasing power of money falls |
| Insurance | Products that give financial protection against certain events |
| Investments | Money paid into financial products; the aim is that the value of the product will grow over time and so the person will eventually make a profit |
| Mandatory expenditure | Compulsory outgoings; they do not necessarily apply to everyone, but if they do apply they must be paid |
| Mortgage | A loan taken out to pay for a property, usually over a long term such as 25 years |
| National Insurance Contributions | Money deducted from the pay of people who are employed or self-employed and used by the government to fund state pensions and other benefits |
| Needs | Things that people need to survive, such as food, basic clothing and a place to live |
| Office of National Statistics | The independent organisation that produces statistics on many aspects of life in the UK |
| Pension | An income that people receive after retiring from work. In the UK people receive a pension from the state; some people also receive pension payments from schemes run by their former employers or arrangements that they have made for themselves |
| Premium Bond | A lottery bond, issued by NS&I, entered into a monthly prize draw with tax-free prizes |
| Real terms | A value adjusted to account for changes in prices. ie although someone may receive a nominal pay increase of 5%, if inflation is 3% then in real terms the pay increase is approx. 2% |
| Retail Price Index (RPI) | One of the ways the government measures inflation. |
| Self -employment | Earning an income by selling your goods or services directly to a consumer, rather an being employed by somebody else and being paid a wage or salary |
| Transaction | Buying or selling something |
| Utility | An essential public service, such as electricity, gas, water and sewerage |
| Wants | Things that people would like to have but can survive without, such as entertainment, fashionable clothes etc |
| Aspirations | Things or experiences that people would like to have in the future, for example owning a home instead of renting |
| ATM | Automated teller machine, also known as a CASH MACHINE |
| Balance | Income minus expenses |
| Budget balance | Total income minus total expenditure: a person's net financial situation. |
| Budget | A plan of expected incomings and outgoings over a set time period such as a month. Also a term given to the government's annual spending plan |
| Budget deficit | A situation in which outgoings exceed income |
| Budget surplus | A sum of money available once all the essential expenditure in a given period, eg a month, has been made |
| Cash flow forecast | A plan of expected incomings and outgoings over several time periods, such as the next 3 months |
| Chancellor | The Chancellor of the Exchequer, The British Cabinet Minister responsible for financial and economic matters and in charge of the Treasury. |
| Consumer Prices Index (CPI) | One of the means the government uses to measure inflation. |
| Credit history | A record of money borrowed and repaid by an individual. |
| Current account | Bank or building society accounts where people can store their money in the form of electronic balances and withdraw it to make payments |
| Discretionary expenditure | Voluntary spending on products and services that people want now, and savings towards items they aspire to buy in the future |
| Dividend | A payment of profits from a company to its shareholders, often at twice-yearly intervals |
| Duty | The tax paid on certain items, including fuel, cigarettes and alcohol |
| Essential expenditure | Spending on items required to live, eg rent or mortgage repayments, food & drink, water, gas, electricity |
| Income | Earnings, savings and interest payments received within a certain timeframe |
| Income Tax | Tax paid on earnings from employment, self-employment and interest on savings |
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