Glossary

Balance - The amount in an account or the remaining amount due on a loan.

Bankruptcy - A legal preceding that relieves one of the responsibilities of paying debts or provides a person with protection while attempting to repay debts. 

Command Financial Specialist - Unit level E-6 or above designated by the command and trained by the Personal Financial Management (PFM) Counselor to provide financial classes and basic counseling to service members within the unit.

Consumer credit counseling services - Civilian nonprofit entities that provide financial counseling and structure debt liquidation plans, generally charging low management fees to maintain plans.

Credit bureau - A private company that collects and sells information about a person's credit history, typically to banks, mortgage lenders, and credit card companies.  The three main credit bureaus, Equifax, Experian, and Trans Union, are regulated by the federal Fair Credit Reporting Act.

Credit report - Prepared by a credit bureau, a credit report is a summary of credit history that contains the amounts owed to all creditors, payment history to creditors (to include timeliness of payments), as well as personal history, such as former addresses, employment record, and lawsuits.

Default - A failure to perform a legal duty, such as failing to make mortgage or auto loan payments on time, failing to maintain adequate insurance, or violating another term of the loan.

Extended absence financial plan - A plan developed by a service member prior to deployment, addressing the following issues for the period of the absence: legal power of attorney to accomplish personal and financial requirements; a plan for meeting financial obligations; disposition of car and auto insurance; allotments for appropriate monthly expenditures; and disposition of other financial issues that might come up during the period of absence.

Financial literacy - Knowing the facts and vocabulary necessary to manage personal finances.

Financial planning and counseling - The act of evaluating an individual's or family's income and expenditures and recommending short and long-term actions to achieve financial goals and ensure individual, family, and mission readiness.

Fraud - Intentionally deceiving another person to cause them to suffer a loss.

Identity theft - A crime in which an impostor obtains key pieces of personal information, such as Social Security or driver's license numbers, in order to impersonate someone else. The information obtained through identity theft can be used to obtain credit, merchandise, and services in the name of the victim or to provide the thief with false credentials.

Interest - A commission paid to a bank or other creditor for lending money or extending credit. 

Personal Financial Management Programs - Programs conducted by trained counselors who provide personal and family financial planning education, information services, and assistance on topics including, but not limited to, consumer education, budgeting and debt liquidation, retirement planning, and savings.

Personal Financial Management Counselor - A trained financial professional, assigned to most installations, with expertise in personal finance and counseling techniques.

Personal financial planning - Development and implementation of coordinated and integrated long-range plans to achieve financial success.

Personal readiness - A service member's responsibility to prudently address day-to-day personal matters and to adequately prepare for the management of personal responsibilities prior to departing on an extended absence.

Predatory lending - Any of a number of fraudulent, deceptive, discriminatory, or unfavorable lending practices.  Many of these practices are illegal, while others are legal but not in the best interest of the borrowers.

Principal - The amount of money borrowed or the amount of money borrowed that remains unpaid; the portion of a monthly payment that reduces the outstanding balance of a loan; or the amount of money put into an investment.

Relief society - An installation-level helping agency that may be able to provide monetary assistance to Service members experiencing financial hardship.

Term of loan - The length of time allocated to repay a loan.