Did you know?
Understanding key financial terms can dramatically improve your ability to manage money, make informed decisions, and achieve your financial goals?
To get you started, we broke down the definitions of some common terms.
The interest you earn on both your initial investment and on the interest that has already accumulated.
It’s the secret sauce of wealth-building! The earlier you start saving or investing , the more time your money has to grow exponentially.
APY refers to the total return on an investment or savings account over a year, including compound interest. It’s expressed as a percentage.
APY allows you to compare different savings or investment options easily. A higher APY means better returns on your money, helping you grow your savings more efficiently. It’s especially useful when choosing between savings accounts, certificates, or other financial products.
An overdraft occurs when you withdraw more money from your bank account than you currently have, resulting in a negative balance. Your bank or credit union may cover the deficit, but they often charge fees or interest for doing so.
Understanding overdrafts helps you avoid unnecessary fees and financial strain . By keeping track of your balance or setting up overdraft protection, you can manage your funds more effectively and avoid costly penalties.
Learn about other financial concepts and discover valuable strategies through General Electric Credit Union’s free resources:
• Upcoming and on-demand webinars
• Money Minutes blog
• eNewsletter
