Managing my money for young adults
Managing my money for young adults

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Managing my money for young adults

Glossary

ATM
Automated Teller Machine typically referred to as a ‘cashpoint’. Also informally known as a ‘hole-in-the-wall’.
bank account
An account held at a bank or building society into which money can be deposited and from which cash can be withdrawn and bills paid. Bank accounts can be either current accounts or deposit accounts.
bonds
These are issued by financial and non-financial companies to raise funds to support their business activities. Bonds normally pay interest annually to those investing in them and have a maturity date at which point the investor receives back the money originally invested.
building society
A mutual organisation whose main function is the offering of savings accounts and the provision of mortgages to finance the purchase of property or land.
cash card
A card that has been credited with an amount of cash and that can then be used to settle bills like a debit or credit card.
cheque book
A book of cheques that can be used to withdraw cash at banks or settle bills.
credit score
The measure or ‘score’ given to you by credit reference agencies based on their assessment of your creditworthiness.
debit card
A card that enables the withdrawal of cash from an ATM (Automated Teller Machine) and the settlement of transactions either physically or online.
goHenry
An example of an app that enables parents or guardians to pay pocket money to their children via a cash card. The card can be used to make purchases or access cash up to the total amount that has been credited to it. The app can be used to apply conditions to its use – for example where the card can be used or for what items. The app can also be used to set tasks and chores for which extra pocket money can be earned. The app allows parents to monitor how the money credited to the card is used.
interest
The rate paid on bank account balances and savings balances or the rate charged on overdrafts and loans. Interest is expressed as a percentage (%) of the balance, for example 6% per annum (p.a.). per annum means ‘per year’.
overdraft
A position where the account holder has drawn on their account in excess of the amount of money that has been placed into the account. The account therefore has a negative balance.
PayPal
An online money transfer and payments system. Note that paying for items on PayPal using a credit card loses your Section 75 protection.
Premium Bonds
These are issued on behalf of the government by National Savings & Investments (NS&I). The bonds pay no interest but are entered into a prize draw each month with prizes of up to £1 million.
Section 75
The section of the Consumer Credit Act 1974 that gives rights for reimbursement for faulty goods etc. which have been purchased with a credit card.
shares
These are issued by companies to raise long-term finance to support their business activities. They normally have no maturity date although investors can sell them, at their prevailing market price, if they require their cash back. Those holding shares may receive dividend payments from the company – typically twice a year. These dividend payments are not guaranteed though. Note that shares are also termed ‘equities’.
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