Account: A business agreement between two or more people or companies that includes the exchange of money or some other asset. For example, you might have a savings account, checking account, and/or credit card account.

Accounts payable: Money that a company owes to suppliers of goods and services purchased on credit. The accounts payable amount is a liability to the company. (Compare with accounts receivable.)

Accounts receivable: Money that is owed to a company for goods and services it has provided to customers on credit. The accounts receivable amount is an asset to the company. (Compare with accounts payable.)

Annual percentage rate (APR): Annual interest rate expressed as a percentage of the loan balance.

Annual percentage yield (APY): Annual interest rate if dividends are left in the account to compound.

Asset: Anything of value that a person or organization owns. Examples include cash, securities, accounts receivable, inventory, and property such as land, office equipment, or a house or car. (Compare with liability. The same item can be both an asset and a liability, depending on your point of view. For example, a loan is a liability to the borrower because it represents money owed that has to be repaid. But to the lender, a loan is an asset because it represents money the lender will receive in the future as the borrower repays the debt.)

ATM card: A plastic card that allows you to get basic financial services from an automated teller machine.

Automated teller machine (ATM): A device for conducting business at your credit union or other financial institution without a teller's help even when it's closed. With an ATM card, you can typically withdraw cash, transfer money between two accounts, or check your account balances.

Balance: The amount of money in an account.

Bank: A business, with a state or federal government charter, that provides services such as paying interest on deposits, issuing and collecting checks, and making loans, especially to businesses. Shareholders receive part of a bank's profit as a return on their investment in the bank, represented by the stock that they've purchased.

Board of directors: People that shareholders have elected to oversee the management of a credit union, corporation, or other organization. Directors meet periodically to fulfill their legal responsibility to represent the other shareholders' interests. Although most organizations pay their directors for their services, most credit union boards consist of unpaid volunteers.

Bond: A legal document that is a promise to repay borrowed principal along with interest on a specified schedule or certain date (the bond's maturity). Federal, state, and local governments, corporations, and other types of institutions raise capital by selling bonds to investors.

Capital: 1. Wealth in the form of cash or property that can be used to earn income. 2. The net worth of a business, which is the amount by which its assets are greater than its liabilities.

Cash: 1. Currency and coins. 2. The currency, coins, bank balances, and ( negotiable) money orders and checks that a business owns.

Charter: Government authorization to do business. A credit union or other financial institution must have a charter with a state or the federal government.

Check: A document that promises to pay a specific amount of money, taken from funds on deposit, to a specific party on demand. Some credit unions call a check a share draft.

Checking account: An agreement that allows you to write a check for payment from deposits in a financial institution. Some credit unions call a checking account a share draft account.

Commercial bank: A bank that offers services to individuals, but specializes in business deposits and loans.

Compound interest: Interest calculated not only on the original principal (def. 3) that was saved but also on the interest earned earlier and left in the account.

Compounding: Earning interest on principal saved and on previously earned interest.

Consumer Price Index (CPI): A measure of inflation that calculates the change in the cost of a fixed set of goods and services, including housing, electricity, food, and transportation. The federal government publishes the CPI, which is also called the cost-of-living index, monthly.

Convenience Card (debit card): A plastic card that you can use like a credit card. The difference is that a credit card lets you borrow money for a purchase, while a debit card makes payment immediately and electronically from your checking account or savings account ; also called "check card" or "cash card." Mazuma's debit card is called a Convenience Card.

Cooperative: An arrangement in which each participant is part owner of an asset or group of assets. For example, people have formed a cooperative (sometimes known as a "co-op") to democratically share ownership of a business or apartment building. A credit union is a financial cooperative.

Corporation: A type of business organization that exists separately from its owners. A corporation has a charter giving it legal rights and responsibilities that protect its owners by limiting their potential obligation and losses. Corporations raise capital and distribute ownership by selling shares of stock.

Counterfeit: Fake, usually referring to phony currency. The Secret Service is in charge of investigating counterfeit money in the U.S. and can tell you a lot about its history and what it looks like. Start at http://www.ustreas.gov/usss/know_your_money.htm.

Credit: A legal agreement in which a borrower receives something of value now by promising to pay the lender for it later. When the item of value is money, the agreement is called a loan. When the item of value is a product, the purchaser buys it "on credit." (See also finance.)

Credit card: A plastic card that allows you to borrow money or buy products and services on credit with your signature. The lender that issues the credit card puts a dollar limit on its use, depending on your creditworthiness. (Compare with debit card.)

Credit history: The record of how you repaid a loan or made payments for something you bought on credit. Lenders such as your credit union use your credit history to help them determine your creditworthiness when you apply for a loan.

Credit union: A not-for-profit financial cooperative whose members own it. You are eligible to join a particular credit union if you belong to the field of membership defined in its charter. All members have the right to democratically elect a board of directors. The board gives the credit union's management and staff general instructions. Historically, credit unions encourage thrift among members and provide them with credit at a low rate.

Creditworthiness: A lender's estimate of a borrower's ability to repay a loan.

Currency: Paper money.

Debit card: A plastic card that you can use like a credit card. The difference is that a credit card lets you borrow money for a purchase, while a debit card makes payment immediately and electronically from your checking account or savings account ; also called "check card" or "cash card." Mazuma's debit card is called a Convenience Card.

Debt: A liability in the form of a bond, loan agreement, or mortgage, owed to someone else with the promise of repayment by a certain date, the debt's maturity.

Deductions: Amounts subtracted or withheld from your gross income (def. 1). Some deductions, such as taxes, are required by law. Others are elective. For example, you might have the option of putting part of your earnings aside in a pension plan, individual retirement account (IRA), or other savings account. You also might instruct your credit union to automatically regularly deduct a loan payment so that you don't have to remember to write a check each month (also called "payroll deductions").

Deflation: A drop in overall prices, often the result of a shortage of money or credit. Deflation is the opposite of inflation.

Deposit: 1. Money you place in a savings account at a financial institution. 2. Money you give to a seller as proof of your intention to buy a piece of property ; also called "down payment."

Depreciation: Decrease in the value of an asset over time.

Disability: Inability to work because of illness or accident.

Dividend: A portion of earnings paid to the owners of a credit union or corporation. (A credit union's owners are called members; a corporation's owners are called shareholders. Credit unions and banks both pay savers a percentage of the money in their savings accounts. Credit unions call this payment a dividend because their members are, by definition, owners. Banks call this payment interest because their customers are not, by definition, owners. Bank dividends go to shareholders.) The board of directors decides what the dividend rate, or percentage, will be. Dividend payments are usually added directly to an account balance. But sometimes a corporation will issue dividends in the form of more stock in the company.

Equity: Ownership of an asset.

Exchange rate: The rate at which you can convert one nation's currency into another (also called "foreign exchange rate"). The exchange rate calculator at http://www.pleo.com/erate.htm will tell you what your money would be worth in any of several other countries.

Fair Labor Standards Act: The federal law that sets such rules as those for child labor and workers' minimum wage and overtime pay.

Federal: Having to do with government on a national level.

Federal Reserve System: The central banking system of the U.S. (also called the "Fed"). Among other services, the Fed determines how much money the government needs to make available and helps credit unions and other financial institutions operate smoothly and safely. Go to http://www.ny.frb.org/links.html to check out the Fed's 12 regional Federal Reserve Banks and their 24 branch banks, many of which offer tours in which you can learn about such things as counterfeit currency and what happens to worn-out money.

FICA: Stands for the Federal Insurance Contributions Act, which created the Social Security system. The employee and employer both pay a FICA tax of 6.2% on a portion of the employee's annual gross income. (For 1999, this portion is the first $72,600 earned. FICA tax does not apply on earnings after that.) This money funds certain government payments, such as for retirement and disability, for you and other workers (and, in some cases, their dependents).

Field of membership: A description of how credit union members are united by a common bond such as where they work or live.

Finance: To pay for something with credit.

Googolplex: The largest named number. A googol is 10 to the 100th power (1 followed by 100 zeros). A googolplex is 10 to the googol power (1 followed by a googol zeros). The estimated number of atoms in the universe is less than a googolplex. In other words, there isn't enough matter in the universe to write a googolplex on. You'll find more information about this and other big numbers at http://www.informatik.uni-frankfurt.de/~fp/Tools/Googool.html.

Goods: Products.

Gross income: 1. For individuals, the amount you've earned before payroll deductions are subtracted. Gross income is usually figured in one of two ways: Either by multiplying your hourly wage by the number of hours you worked during the pay period. Or by dividing your annual salary by the number of pay periods in the year. 2. For businesses, the amount of revenue from product sales minus the cost of producing the products that were sold. (Compare with net income.)

Income: Earnings from a job or an investment.

Income tax: A payment to federal, state, and local governments based on individual or company earnings.

Individual retirement account (IRA): A special federal program that allows you to delay the payment of income tax on some money you save, which reduces the amount of tax owed. IRA rules determine how much money you can save under this program, how you can get your savings out, and how much tax you finally pay.

Inflation: A rise in the general price level of goods and services; inflation is the opposite of deflation. The Consumer Price Index and the Producer Price Index are the most common measures of inflation. Find out what inflation has done to the value of U.S. money between any two years from 1800 to 1997 with the calculator at http://www.westegg.com/inflation/.

Interest: An amount paid for the use of someone else's money. You pay the credit union to use the money you borrow from it. The credit union pays you to use the money you save there.

Interest rate: A percentage that tells what borrowed money will cost or savings will earn. An interest rate equals interest earned or charged per year divided by the principal amount, and expressed as a percentage. In the simplest example, a 5% interest rate means that it will cost you $5 to borrow $100 for a year or you'll earn $5 for keeping $100 in a savings account for a year. (The math is more complicated when the financial institution uses a daily or monthly interest rate. Another complication occurs when borrowers make loan payments and savers add or withdraw savings periodically during the year. See also compounding.)

Internal Revenue Service (IRS): the agency of the federal government that's responsible for collecting federal income and other taxes and enforcing the rules of the department of the treasury.

Inventory: A company's unsold products, finished and unfinished, and the raw materials used to make them.

Investment: Something of value that you buy, expecting that it will provide income and increase in value.

Investor: Someone who buys an asset for the income it'll earn and the increased value it'll have in the future.

Job benefits: Something of value that an employer gives employees in addition to money. Job benefits vary widely from business to business and are typically available only to full-time workers. Benefits can range from health insurance to your own space in the company parking lot.

Liability: Something owed to another party. (See also debt and loan. Compare with asset.) The same item of value can be both an asset and a liability, depending on your point of view. For example, to the borrower a loan is a liability because it represents money owed that has to be repaid. But to the lender, a loan is an asset because it represents money the lender will receive in the future the debt is repaid.

Loan: An agreement in which a lender gives money or property to a borrower, who has to repay or return it, with interest, at a specified time.

Maturity: The date on which a financial obligation is due to be fully repaid.

Medicaid: A joint federal and state government program that pays for medical care for people who can't afford it.

Medicare: The federal government's hospital insurance plan, which pays for certain health care expenses for people age 65 or older. The Social Security Administration manages Medicare.

Minimum wage: The least amount an employer can pay workers, according to the federal government law known as the Fair Labor Standards Act. Some states have higher minimum wage standards. (See http://gatekeeper.dol.g ov/dol/esa/public/youth/mwtour4.htm for more information.)

Mint: A government "factory" for making coins. Get information about the U.S. mint in Denver at http://www.usmint.gov/facts/denver.cfm and about the Philadelphia mint at http://www.usmint.gov/facts/philadelphia.cfm. Both U.S. mints offer tours that will leave a cool, refreshing taste in your mouth.

Money order: A legal document that is a promise to pay the individual or business named on it a specified amount of cash when presented at a financial institution. Money orders are an alternative to paying by share draft or check or cash.

Mortgage: A loan to buy real estate.

Mutual fund: A kind of investment that a company makes on behalf of shareholders. The company sells shares in the fund and invests the money in a group of assets, usually securities. The fund's managers make investment decisions according to stated objectives.

My Travel Wallet: You no longer have to go to a financial institution to obtain foreign currency for your next international trip. Now, with My Travel Wallet™ program, obtaining foreign currency and travelers' checks can be done securely online from your home.

Negotiable: Able to be sold or transferred to another party as payment of an obligation.

Net income: 1. For individuals, your total earnings minus your required and elective payroll deductions. Commonly known as "take-home pay." 2. For businesses, gross income (def. 2) minus all other expenses.

Net worth: An individual's or company's total assets minus total liabilities. (Also known as capital, def. 2)

Obligation: A written promise or debt.

Outstanding balance: A loan amount not yet repaid.

Pension: A government-approved employee retirement plan.

Personal identification number (PIN): A secret code that helps keep other people from using your credit card or debit card.

Principal: 1. The amount borrowed, or the part of the amount borrowed that remains unpaid (not including future interest). 2. The part of a monthly payment that reduces the outstanding balance of a mortgage or other loan. 3. The original investment amount.

Producer Price Index (PPI): A measure of inflation that considers changes in wholesale prices. The federal government publishes the PPI monthly.

Profit: Business revenue minus all expenses.

Property: What you own, an asset.

Real estate: Land, including any buildings or structures on it.

Retail: The sale of goods to individuals instead of to institutions or other stores. (Compare with wholesale.)

Retirement: Withdrawal from an active working life.

Return: The increase in value of an investment over time.

Revenue: Total dollars a business receives for the goods and services it sells.

Rule of 72: A shortcut for estimating how long it will take to double your money at a certain interest rate. Here’s how it works: Divide 72 by the interest rate. The answer is the number of years it will take for any amount of money to double. For example, if your money in savings earned 3% interest, then you'd need (72/3=) 24 years to double it. You also can use the Rule of 72 to estimate the interest rate needed to double your money in a certain number of years. For example, if you want your money in savings to double in 9 years, then you'd need to earn (72/9=) 8% interest on it.

Salary: Earnings received for regular periods, usually weekly, biweekly, or monthly. Salary is usually based on duties you perform, not the number of hours you work per pay period.

Savings account: A business agreement in which a credit union or other financial institution agrees to hold and pay interest on money you've deposited. You may withdraw some or all of your money, but not by writing a share draft or check.

Savings and loan association (SL): A business, with a state or federal government charter, that takes deposits from individuals and uses them to make loans, especially mortgage loans. Depositors or shareholders receive part of an SL's profits as a return on their investment in the SL, represented by the money they've deposited or the stock that they've purchased.

Secured and Share Secured Loan: An automobile loan is an example of a regular secured loan. Interest rates are lower than an unsecured loan because the vehicle is considered collateral in case of payment default. Share secured loans are backed by collateral such as with funds in a savings account or share certificate. With a share secured loan, members can borrow money at a lower rate of interest compared to an unsecured loan. A share secured loan can be made against primary shares or any Mazuma CD.

Securities: An investment document that a corporation, government, or other organization issues as proof of debt or equity.

Services: Work a business performs for its customers.

Share: 1. A given amount of money you deposit with a credit union to become a member. A share entitles you to certain ownership rights (such as the right to vote for members of the board of directors), has a stated value, and pays dividends. 2. One unit of ownership in a corporation or mutual fund (same as stock).

Share account: The basic credit union savings account. You may usually withdraw money from your share account "on demand," that is, without giving your credit union advance notice and without paying a penalty. (Compare with share certificate account.)

Share certificate account: An credit union savings account that will earn dividends at a particular rate if held to maturity. If you withdraw any or all of the principal before maturity, you may have to pay a penalty of a percentage of the amount withdrawn.

Share draft: A credit union term for check, so called because it allows you to to withdraw funds or pay bills from your credit union shares.

Shareholder: Someone who owns shares in a corporation or mutual fund. Shareholders earn dividends and typically have the right to vote for members of the board of directors and on other company matters; also known as "stockholder." You can be a customer of a bank without having a shareholder's ownership rights; in contrast, credit union membership automatically gives you ownership rights such as the right to vote for members of the credit union's board of directors.

Social Security: A program of the federal government that provides workers and their dependents with retirement, disability, and other payments. The money for Social Security payments comes from a tax, usually labeled "FICA" on your paycheck, that employees and employers pay equally.

Statement: 1. The periodic report of your use of your accounts at a financial institution. 2. A written record of financial information, such as money owed.

Stock: A document that shows equity in a corporation. Stock represents each shareholder's claim on a part of the company's assets and profits.

Stockholder: Someone who owns stock in a corporation or mutual fund. Stockholders earn dividends and typically have the right to vote for members of the board of directors and on other company matters; also known as shareholder. You can be a customer of a bank without having a stockholder's ownership rights; in contrast, credit union membership automatically makes you an owner.

Surcharge: Automated teller machine ATM surcharges are additional fees imposed on consumers who use ATMs to withdraw cash. Unlike ATM fees, surcharges are imposed directly at the machine and are charged by the owner of the ATM. Banks usually impose ATM surcharges only on customers of other banks, though some ATM owners impose surcharges on everyone.

Tax: A payment to federal, state, and/or local governments based on the sales price of a product, on worker income, or on other property and activities.

Thrift: 1. The wise use of money, especially avoiding unnecessary spending. 2. An financial institution formed to hold deposits for and make loans to individuals, not businesses; examples include credit unions and savings and loan associations. (Compare with commercial bank.)

Verified by Visa: Verified by Visa protects your existing Visa card with a personal password, giving you reassurance that only you can use your Visa card online.

W-4 form: A tax form that you get from your employer and fill out to help your employer determine the amount of taxes to withhold from your paycheck (see withholding).

Wage: Payment for work, sometimes used to refer to payment based on hours worked instead of duties performed. (Compare with salary.)

Wealth: Property that is valuable because it could be sold or used to generate income.

Wholesale: The sale of goods in quantity to a distributor who in turn sells to retail stores and institutions, instead of individual consumers.

Withholding: The part of your earnings that your employer sends directly to the federal, state, or local government as partial payment of your expected tax for the year.