Know Money, Win Money! Episode 7: Financial Knowledge
Here at “Know Money, Win Money” we love to crash all the big events, from sports games to comic conventions. But sometimes we like to go back to our roots and just ask people on the street about personal finance. And that’s exactly what we’ve done! Check it out:
Our first question was about principals. No, not the principal who kept trying to catch you cutting school when you were younger! The principal of a personal loan. That’s the original amount of money you borrow from a lender. Since you’ll almost certainly be paying interest on that principal, you’ll want to make sure your loan is amortized.
What does amortized mean? That was our next question! Amortized payments are spread out over a longer period of time and each payment covers a part of the interest and a part of the principal. That means you won’t have to repay the whole loan in one go, and you won’t get stuck paying interest over and over—without ever actually getting out of debt. (There are debt trap loans like that, by the way. The most well-known and one of the most dangerous is called a “payday loan.” Avoid those like your paycheck depends on it!)
Finally, we asked what the “NSF” in NSF fees stand for. The answer is “non-sufficient funds” and they aren’t fun letters to see. It means you tried to make a withdrawal or cash a check from an account that didn’t have the proper funds. Obviously, you shouldn’t make a withdrawal when you don’t have the funds to cover it, but if someone gives you a check that bounces, you might need to get in touch with them to get the money to cover the fee as well as the original amount they were supposed to give you.
That was fun! Look out for us the next time you’re on the streets. Show us your financial knowledge and you might just win some cash!
Be sure to also check out our most recent episodes:
The information contained herein is provided for free and is to be used for educational and informational purposes only. We are not a credit repair organization as defined under federal or state law and we do not provide "credit repair" services or advice or assistance regarding "rebuilding" or "improving" your credit. Articles provided in connection with this blog are general in nature, provided for informational purposes only and are not a substitute for individualized professional advice. We make no representation that we will improve or attempt to improve your credit record, history, or rating through the use of the resources provided through the OppLoans blog.