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What is a CPA?

A Certified Public Accountant (CPA) is a tax and accounting professional who has completed a certain amount of education and passed the official CPA exam and received state certification to get paid to practice. CPAs are required to complete a...

What is a Coverdell Education Savings Account (ESA)?

Formerly called an "Education IRA," a Coverdell Education Savings Account allows families to save money on a tax-deferred basis for primary and secondary education expenses for children under the age of 18. However, the maximum annual contribution...

What is Compound Interest?

Compound interest is interest that accrues on an amount of money plus the accumulated interest on that money. Compound interest helps money grow faster than simple interest which is calculated as a percentage of only the original amount.    See...

What is a College Savings Plan?

A college savings plan is the same as a 529 savings plan, or a savings plan where money can be invested to grow on a tax-deferred basis and withdrawn free from federal and potentially state taxes if used for "qualified" higher education expenses,...

What is a Checking Account?

A checking account is a highly liquid, transactional account held at a financial institution that allows you to make withdrawals and deposits on demand. Because of the high liquidity, checking accounts generally pay a very low rate of interest, if...

What is a Certificate of Deposit (CD)?

A Certificate of Deposit (CD) is a promissary note generally issued by commercial banks that has a maturity date, fixed interest rate and is insured by the FDIC. In most cases there is a penalty for withdrawing your investment prior to the...

What is a Budget?

A budget is an estimate of income and expenses for a specific period of time in the future that can be used for personal, business or other purposes. Ideally, you have a "surplus" budget with extra income after all expenses and not a "deficit"...

What is a Bond?

A bond is a debt investment in which an investor loans money to a corporation, government or municipality that borrows the funds for a defined period of time at a fixed interest rate. Bonds are used to finance a variety of projects and activities....

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