What Is a Stipend?

A stipend is a payment made to a trainee or learner for living expenses, unlike a salary or wages, which are paid to an employee.  Though the terms "stipend" and "salary" are often used interchangeably, the U.S. Department of Labor has a specific stipend definition with several criteria that must be met to pay a stipend. Continue reading

What Is Bankruptcy?

Bankruptcy is a legal proceeding available to folks who can't find another way to pay their bills and satisfy their creditors. It's a last resort, since it goes on your credit report for 10 years, reduces your credit score and cuts your access to credit. You declare bankruptcy in court with the assistance of a lawyer who has the required expertise. Continue reading

What Are Loans?

Loans refer to when one party gives money to another on the condition that it be paid back, typically with interest, at a certain time in the future. The terms of the loan determine what that interest rate will be, how long the borrower has to repay the money, and sometimes place additional stipulations on the funds including how the proceeds are used. Continue reading

What Is Net Income?

Net income refers to the cash value of a paycheck after deductions. Gross income -- your pay before deductions -- starts with your wages for the pay period. For salaried workers, this equals your annual base salary divided by the number of pay periods in the year. Hourly workers' gross income equals their hourly wage multiplied by hours worked, plus any overtime pay. Additional income from... Continue reading

What Is A Short-Sale Home?

A short sale of a home is when a home sells for less than the amount needed to pay off the mortgage. In a short sale, the lender agrees to accept the lower sales price as payment in full for the remaining mortgage balance. For example, if someone owes $150,000 on mortgage and is falling behind on payments, the bank might agree to take $135,000 as payment for the mortgage. Continue reading

What Is a Budget and Why Is Budgeting Important?

A budget is a way to track your income and expenses so you can gain control of your finances. Learn how to adjust spending habits and save for future goals. Continue reading

What Are Minimum Payments?

Minimum payments refer to the smallest amount you can pay on a debt and still be considered current with your payments. The term minimum payment is usually used in the context of credit cards. Even though you might think you're doing just fine paying the minimum, if that's all you pay, it can take you several years (and potentially thousands of dollars in interest) to pay off a debt. Continue reading

What Is Net Worth?

Your net worth refers to how much more your assets are worth than your liabilities. In short, your net worth is how much money you would have if you sold everything you own and used the proceeds to pay off your debts, explains personal finance blogger Trent Hamm in the Christian Science Monitor. If the money wouldn't be sufficient to pay off all your debts, you have a negative net worth. Continue reading

What Is Debt?

Debt refers to money that you owe someone else and includes things like credit card debt, student loans, car loans and mortgages. Though few people enjoy talking about it, debt levels in America are high: According to an article published in Time magazine, consumer debt in the United States exceeded $11.5 trillion in 2014. Repayment Terms When you borrow money, the lender generally sets the terms... Continue reading

What Are Payments?

Payments refer to the transfer of money or services by someone to fulfill his obligations to another party. In the personal finance area, payments refer to money given to creditors by the borrower to pay back loans such as credit cards, mortgages and student loans. Continue reading