Money Management Guide

The basics of Taxes and Money Management Concepts

Depository Institutions

This is just the fancy term for a bank. It is a place where you can place and withdrawal money from, and depending on who you pick to hold your money determines how secure it is.

Commercial Bank

This is not an exclusive bank, meaning it offers services to citizens as well as businesses. It's like the community college of banks.

Credit Union

This is an exclusive bank, meaning you have to have certain qualifications to become a member of one, but the benefits from being a part of a credit union are very helpful, and money seems more secure. This is more like the private university of banks

Savings and Loan Associations

This is an institution that accepts savings at interest and lends money to savers chiefly for home mortgage loans and may offer checking accounts and other services. Basically, this is the developed reward system for smart people. If you are smart with your money and save as much extra as you can and pay bills on time or earlier, the bank will have no problem lending you the money you need to start the business you want to start or reimburse you for the really fast car you've always wanted.

Taxes... :(

One of the most hated expenses that anyone living as an American citizen has to pay. As redundant as it may sound, without taxes, our government wouldn't exist as richly as it does today.Tax is a compulsory contribution to state revenue, received by the government on workers' income and business profits or added to the cost of some goods, services, and transactions. There are plenty of different types of taxes, but three really important types of taxes are Payroll Tax, Federal Income Tax, and sales tax.

Payroll Tax

A tax that a boss of a group of employees holds or pays on based on the wage or salary of the employee. In the United States, state and federal authorities collect some form of payroll tax. Medicare and Social Security in the United States make up the payroll tax.

Federal Income Tax

This one is simple. It is tax imposed by a national government on annual income. This is where that nasty amount of money you have to pay annually for what seems to be no reason at all.

Sales Tax

A tax enforced by the government on goods and services, which is collected by the retailer and passed on to the state. Sales tax is based on a percentage of the selling prices of the goods and services and is set by the state. Consumers (us) pay sales taxes. It's the reason why that Chinese food you just ate was listed at $7.99 but you paid $8.43 for it.

The Statement of Financial Position

This is basically the spreadsheet that you evaluate to see where you money is or where it was before you spent it.


This is simply a useful or valuable thing. In money's case, it is anything that increases your net worth. This could be anything from a house and car all the way to any baseball cards you may have collected that may have a bit of value to them.


A liability is opposite of asset. In this case, it's what you spend your money on or anything else that caused you to have less money after you bought it or it happened to you. This could ba a car payment or internet bill, or it could be the car accident you just got finished going to the chiropractor for.

Net assets

This is all of your assets minus the total of all of your liabilities.If this number is positive, then you spend less than you make, which can help you get a membership to a loan company to help you buy more things! However. If this number is ever negative, you will have a much harder time getting support from a bank to help you buy more possessions, let alone have enough money to live off of. This number must be kept positive or you go bankrupt.

Income and Expense Statement

this is a financial statement that measures your own or a company's financial performance over a specific period of time.

Your Spending Plan

A document used to determine the cash flow of yourself, an individual, a family, or a complany.