Unit 3A Glossary
BTEC Level 3 Business Studies. Unit 3: Personal and Business Finance
Attitude to borrowing - An individual's comfort level with borrowing money
Attitude to saving - An individual's feeling of how important it is to save money
Attitude to spending - A individual's comfort level with spending
BACS - Bankers Automated Clearing System
Bankruptcy - When an individual or business is unable to pay their debts, assets are sold off to pay and any debts left over are not paid
Basic account - A type of current account with the most basic features of depositing and withdrawing money.
Bonds and gilts - Lending money to the government to be returned with interest
Business finance - The management of money by organisations to pay their debts
Cash - Money in the form of bills or coins
CHAPS - Clearing House Automated Payment System
Charge cards - card that specifies that consumers must pay the account in full at the end of the month
Cheque - a written order directing a bank to pay money Contactless cards - Payment cards that allow customers to pay for items without entering a pin
Control costs - Identifying and reducing business expenses
Cost of borrowing - The total charge for taking on a debt obligation that can involve interest payments and other financing fees.
Counter effects of inflation - Investing money in a way that it rises in value at a higher rate than the rise in prices of goods and services
Credit card - A plastic card used to make purchases now and pay for them later.
Credit cards - Plastic cards used to make purchases which are paid for later
Credit rating - a measure of a person's ability and willingness to make credit payments on time based on previous payments
Culture - Beliefs, customs, and traditions of a specific group of people.
Current accounts - Standard, packaged, premium, basic and student
Debit card - A bank card that automatically deducts the amount of a purchase from the bank account of the cardholder
Debt - Money owed Deposit account - A bank account that allows you to add money to the account.
Direct debit - An electronic payment out of one account to another
Electronic transfer - the transfer of funds from one account to another via the internet or telephone
External influences - Influences that come from outside of the individual or family that may affect their attitudes to money
Financial goals - Plans for making buying decisions such as buying a house or saving
Financial products - Services that financial institutions provide such as current accounts, savings, loans and pensions
FPS - Faster Payments Service Hire purchase - The buying of equipment by paying in instalments, usually including interest.
Income - Earnings from work or investment
Insurance against loss or illness - Saving money so that personal debts can be paid in the event that there are periods of no income
Insurance products - Car, home and contents, life assurance, travel, pet, health
Interest rates - The cost of borrowing money. Usually a percentage of the loan.
ISAs - Individual Savings Account Legal action - the use of the courts as a means of asserting rights and interests
Legal tender - Recognition in law that money can be used to pay a debt
Life events - Turning points at which people change some direction in the course of their lives. E.g. marriage or illness
Life stages - Childhood, adolescence, young adult, middle age, old age
Means of exchange - The ability to swap money for goods and services
Mobile banking - A type of banking whereby transactions are made via a smartphone or tablet app.
Mortgages - Loans from banks and building societies that are used to buy land and buildings such as offices and shops.
Overdraft - The ability to take out more money than is in your bank account. Usually for a fee or higher interest
Payday loans - A short-term, high-interest loan that usually must be repaid on the borrower's next payday.
Pensions - retirement payments Personal finance - The management of money by individuals and families to use their salaries for paying personal expenses and for savings
Personal life cycle - Different stages that people go through in their life.
Personal loans - Money borrowed from a bank to make a large one-off purchase such as a car or home renovation. To be paid back in installments.
Planning expenditure - Organise finances so all debts can be paid, an individual or business can remain solvent and maintain a good credit rating
Pre-paid card - A card issued by a financial institution that is preloaded with funds and is used like a normal credit card.
Premium account - Current accounts that have a monthly fee but come with extra perks such as free insurance
Premium bonds - Government security that offers no interest or capital gain but is entered in regular draws for cash prizes
Repossession - Taking away property due to failure to make loan or credit payments
Reward of saving - Interest payments given to customers who deposit money in savings accounts. Calculated as a percentage of account balance.
Risk and reward - A calculation of the potential loss vs. potential gain in a financial decision
Saving and investment features - ISAs, deposit and saving accounts, premium bonds, bonds and gilts, shares and pensions.
Savings - Portion of income not spent on consumption
Savings account - a bank account that earns interest
Shares - Buying a portion of ownership in a company which may increase or decrease in value and earn dividends
Solvent - having assets in excess of liabilities; able to pay one's debts.
Standard account - A type of current account which is usually free and offers features such as overdrafts and chequebooks
Standing order - a regular sum of money that you instruct the bank to make out of your bank account to a company or person.
Store cards - a credit card that can be used only in one store chain of stores
Store of value - The ability to save money for trade at a later date
Student account - A current account designed for students in higher education that charges low interest or no interest on overdrafts and offers other benefits such as low-cost contents or travel insurance.
Trends - General attitudes towards money that change across a whole societal group
Unit of account - The ability to use money to measure the value of goods and services
