APR
Annual percentage rate: the yearly cost of borrowing money, shown as a percent. It includes interest and some fees. Many credit cards charge more than 20%.
Also called: annual percentage rate
Practice it
- Worksheet: Credit cards and credit scoresHow credit card interest works, why the minimum payment is a trap, and what builds a credit score.
- Worksheet: Car loans: the real costHow the interest rate and loan length change what a car really costs.
Learn the bigger idea
- Interest rates and the Fed, explainedThe price of borrowing money, who sets it, and why a change in Washington shows up in your car loan and savings account.
- Credit cards and credit scores, explainedThe three-digit number that follows you for years, and how a credit card can help it or wreck it.
- Loans and debt, explainedHow borrowing for a car, college or a house works, and why the monthly payment isn't the real price.
Related words
- Interest rate
- Interest shown as a percent of the amount borrowed or saved, usually per year.
- Federal Reserve
- The U.S. central bank, often called the Fed. It raises or lowers a key interest rate to keep prices stable and jobs plentiful.
- Yield
- The yearly return an investment pays, shown as a percent. For bonds, yields go up when prices go down.
- Treasury
- A loan you make to the U.S. government. Treasuries are considered one of the safest investments.
- Bond
- A loan you make to a government or company. It pays you interest and returns your money on a set date.
- Inflation
- When prices rise across the economy, so each dollar buys a little less.
Test yourself in Word sprint · All money words
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