The federal form that is mailed to you by your employer summarizing taxes paid during the year is
W-4 The federal form that you fill out for
your employer when you first become employed to help them figure out how much tax should be deducted from your paycheck is
Life Insurance The type of insurance needed to
compensate individuals left behind when you die
Medicare The health benefit provided to the
eldery to reduce the cost of medical expenses
Variable/Flexible Expenses Expenses that fluctuate (change each
month) are
Liability Insurance that covers others hurt by
your negligence
Payroll Tax A tax on earned income that supports
the Social Security and Medicare programs (also known as FICA)
Disability Insurance• Replaces part of your income lost due to
illness or injury
Beneficiary The individual who receives the
proceeds from a life insurance policy
Health Insurance Insurance that covers the cost of
medical procedures
I-9 The form you must complete before
working proving you are eligible to work in the United States
1040EZ The document you complete for filing
taxes
Premium The monthly amount paid for insurance
Deductible The amount that you have to pay on a
loss before the insurance begins paying
Net Pay Gross pay minus deductions equals
Direct Compensation This is compensation usually paid in
monetary form such as salary, wages, merit pay, bonuses, and stock options.
Co-insurance requires the insured individual to pay a
fixed percentage of the loss after the deductible has been paid
Emergency Savings When you have 6 months of expenses
set aside in case of unexpected events
Social Security A payroll tax deducted at a rate of 6.2%
Policy Holder Person who owns the insurance policy
Long Term Care Payment for extended nursing care
when a person cannot live independently (but doesn’t need to be hospitalized
Automobile Insurance Insurance that covers the cost of fixing
your car if you back in to a pole is
Budget The process of planning for monthly
expenses and income
Pre-Tax Deductions Deductions are made from your
paycheck prior to other taxes being deducted
Indirect Compensation Benefits of working at a job in the form
other than monetary payment (vacation, sick days, company car, etc.)
Salary The amount of money you are paid
regardless of the number of hours or days you work
Property Insurance payment to insured person if his/her
property is damaged or destroyed by an accident
Policy A contract between the insurance
company and the insured that states the exact terms of the coverage
Wage The amount an employee is paid per
hour for time worked.
Post Tax Deduction Additional deductions are taken from
your paycheck after taxes have been paid
April 15 The deadline for filing your taxes
Age 26 Your parents are able to carry you on
their health insurance until this age.
Risk An uncontrollable or unforeseeable
event that can occur
Claim A formal request to an insurance
company asking for payment when the policyholder has an accident, illness or injury
Other things to Review: Be able to identify or categorize examples
as fixed or variable examples Calculate a budget (like we did in class) Examples of pre & post tax deductions Reasons to have a budget PYF-Pay Yourself First When you can use a 1040EZ form You will need to be able to work a 1040EZ