Personal Finance & Money Stack Exchange
Personal Finance & Money Stack Exchange

Questions tagged [financial-literacy]

for questions related to understanding basic concepts in finance or certain terms in a particular context

for questions related to understanding basic concepts in finance or certain terms in a particular context

654 questions
255
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22 answers

Why isn't everybody rich?

This question came up after reading this question (stock market long term risks), in which it is re-iterated (as it has been many times on this site), that investing in the stock market, especially an index fund that tracks the top 100 / 500…
Cloud
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201
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19 answers

How smart is it to really be 100% debt free?

For the last 2 years, I have been trying hard to be debt free without affecting my personal cash flow. I am by no means a rich person, but I have a decent salary. I still have debt, specifically Education Loans (Interest 3%) Car Loan (Interest…
Geo
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168
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11 answers

Do I make money in the stock market from other people losing money?

Basically I am new to stock trading and neglect to see the differences between trading stocks and betting on sports. Basically I am "betting" on which company will do well, and this can change due to "upsets" just like in sports, but my main…
Asleepace
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132
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13 answers

Why does gold have value?

I'm curious about why is there so much financial interest and news coverage about gold. It's hard to do things like buy food or pay the rent with gold, but I can do this with cash. Gold doesn't yield income like bonds. When I buy a corporate stock,…
Stefan Lasiewski
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130
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23 answers

Why buy insurance?

I don't understand why people buy insurance when they know the odds are not in their favor. Is staying uninsured and saving money not a better bet? I am not talking about house insurance. About things of which cost can be covered by one. Laptop,…
shravan
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119
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14 answers

As a 16 year old, how can I keep my money safe from my mother?

I am 16 and still in HS and work 20+ hours a week. I live with my mother (my Dad left us when I was a kid and I don't see him anymore). My mother is an alcoholic and has trouble keeping a job. I don't want to give too many details here but in the…
Djune286
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94
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9 answers

When someone's ability to pay is suspect, why would it make sense to give them more expensive credit?

Answers to the recent question "Why don't bond makers just get loans?" Seem to take it as a given that lending someone money at a 12% interest makes sense when there is already doubt about their ability to pay back the same loan at a 5%…
HAEM
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68
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9 answers

Why do financial institutions charge so much to convert currency?

With all the modern technology that we have, I am astonished that financial institutions charge such exorbitant prices for currency conversions. My bank, Fifth Third, charges a 3% conversion fee, while Paypal charges about 4%. I know that currency…
Chris Cirefice
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68
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3 answers

How did this day trader lose so much?

I recently read this article about a day trader that lost $100,000: A trader started a GoFundMe page to pay back $100,000 to E-Trade after a disastrous short Please explain this, because I can not understand how this "trader" lost so much money. …
Marie Kiev
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67
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14 answers

What are some effective ways to help someone financially?

After managing my income and investments quite well over the last few years, I’m reaching the point of having more income than my personal needs require, and (after already giving thousands to charity each year, a topic for a separate discussion) I…
Simon E.
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60
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9 answers

Why are 30-year mortgages seen as unwise, if you can pay off the loan in a shorter period of time anyway?

I'm slowly working towards buying my first home (yay!), and have been playing around with the numbers. As far as I can tell, there's literally zero advantage for getting a 10 or 15-year mortgage since I can just get the exact same mortgage in a…
user44315
58
votes
6 answers

How can a company use money from stock investors when they are constantly being bought and sold?

I am interested in the mechanisms which a company can use the money that investors give them when they buy a public stock since they are being bought and sold constantly. How can a company spend other people's assets when the shareholders still own…
Katz_Katz_Katz
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57
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4 answers

When a stock price rises, does the company get more money?

When a stock price rises, does the company get more money?
user454
50
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9 answers

If stock price drops by the amount of dividend paid, what is the use of a dividend

I have heard that some people buy stocks based on how much dividend they pay, because dividend is considered 'income'. But if I buy a stock for 100$ and it pays a $1 dividend, the stock would also drop by $1. So really, is there any benefit to the…
Victor123
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49
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1 answer

Numbers in parentheses in financial statements?

In financial statements numbers are sometimes given with parentheses around them, while other numbers appear without parentheses. What does it mean if a number is enclosed by parentheses?
Kagaratsch
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