Alternate definition: In politics, a third party can refer to a political party outside the Democrat and Republic binary, such as the Libertarian Party or Green Party. Let’s say a buyer is making a purchase from an online retailer. The retailer cannot take cash over the internet but will accept a credit card payment. The online retailer uses a credit card processing company to facilitate the transaction. When the buyer completes online checkout, their payment information is submitted to the third-party payment processor....

Understanding Treasury Yields The Treasury Department sets a fixed face value and interest rate for Treasurys. It then sells them at an auction. High demand drives the price above the face value. That decreases the yield because the government will pay back only the face value plus the stated interest rate. Low demand drives the price below the face value. That increases the yield because the buyer paid less for the bond but receives the same interest rate....

Let’s take a closer look at vacation homes, how you might use one, and whether buying this type of secondary property is a good idea for you. Definition and Examples of Vacation Homes The definition of a vacation home may seem fairly obvious: It’s an additional property you and your family visit on occasion and typically use for recreation. However, it’s not as simple as just being an extra house....

When you need to send or receive money quickly, a wire transfer might be the right tool for the job. Wire transfers are fast, reliable, and generally safe. For some big transactions, a wire transfer might be your only option. This is because the funds are available to the recipient more or less right away. If you are buying a house, for example, your settlement agent may require you to use a wire transfer to pay your down payment and closing costs....

Depending on policy specifics, that could be if you become terminally ill, chronically ill, or critically ill; require long-term care; or experience any of these conditions. (This might be the case if the policy contains multiple riders or if one rider covers multiple events.) Benefits eligibility and limits vary by insurer and by state. One or more ADBs may be included as standard policy features or available as optional riders, some at additional cost, on both permanent and term life insurance policies....

Businesses also have the option to process credit card transactions in real time. Understanding how batch processing works and the pros and cons will help you make an informed decision for your business. Definition and Example of Batch Credit Card Processing Batch credit card processing involves processing a group of transactions at once, usually at the end of the day. Instead of processing each transaction as it occurs, the company will let these transactions add up, then settle them at the close of the business day....

Alternate name: Cash rewards Let’s say you make a $200 purchase on a credit card that offers 2% cash back on all purchases. You would earn $4 in cash back. How Cash Back Works Credit card issuers offer cash-back rewards credit cards paying between 1% and 5% per transaction. Cash-back rewards incentivize consumers to sign up for credit cards and encourage loyalty. Each time you make a qualifying purchase, you earn a certain amount of cash back as defined by your credit card rewards program....

pixdeluxe / Getty Images Two types of farming operations can qualify for Chapter 12 bankruptcy. An Individual or Married Couple An individual or a married couple with a farming or commercial fishing operation and regular annual income can file for Chapter 12. Some rules apply: Their total debts can’t exceed $4,153,150 for a farmer, or $1,924,550 for a fisherman.At least 50% of their debts must come from the farming operation if they’re a family farmer....

For instance, a retailer that offers the lowest prices around has a competitive advantage over other retailers whose prices are higher. The low prices can make that retailer’s products more attractive than other, higher-priced options. How Competitive Advantage Works To create a competitive advantage, a business must provide a clear benefit to its target market that’s better than what the competition offers. Consider: What is the real benefit this product or service provides?...

Think about compound interest a bit like what happens when the “snowball effect” occurs. A snowball starts small, but the more snow that’s added, the bigger it gets. As it grows, it becomes bigger at a faster rate. How Does Compound Interest Work? To understand compound interest, start with the concept of simple interest: You deposit money, and the bank pays you interest on your deposit. For example, if you earn 5% annual interest, a deposit of $100 would gain you $5 after a year....

If the position is perfectly hedged, the price fluctuations will be perfectly matched so that the same total dollar amount of loss on the option will be gained on the asset. In general, hedging is a strategy used to reduce risk. An investor hedges a position in a particular security to minimize the chance of a loss. The nature of a hedge, though, also means the investor will give up potential gains as well....

In addition to looking at a stock’s average monthly and annual returns, it’s helpful to review how often, and to what degree, its performance deviates from that average, especially when it falls short of the average. This measure is called “downside deviation.” Downside deviation is a measure of price volatility, or how stable it is over a certain amount of time. It looks at the returns over time and calculates how likely they are to fall below the average return....

As more jobs are created, incomes rise. Consumers have more money to buy additional products and services, and purchases drive higher growth. For this reason, all countries want positive economic growth. This makes economic growth the most-watched economic indicator. Example of Economic Growth As an example, take a look at the U.S. economy in the 1980s. After two economic contractions in the first three years of the decade, the economy began to boom....

Alternate names: E-money If you paid for your morning coffee with a debit card, electronic money was transferred from your account to the merchant’s account. If you paid with a credit card, funds were transferred from the credit issuer to the merchant. When you get paid via direct deposit, you receive funds via an EFT. How Does Electronic Money Work? Electronic money can be held on cards, devices, or a server....

Form 5498 also reports: RecharacterizationsConversionsYear-end fair market values The form includes both deductible and nondeductible contributions. Contributions to a Roth IRA don’t qualify for a tax deduction, because distributions from this type of account are tax-free. Even so, they are still reported on Form 5498. Who Uses Form 5498? Financial institutions that manage IRAs for clients use Form 5498 to report contributions to the IRS. You will also receive a copy if you made contributions to an IRA during the prior tax year....

Alternate names: Pre-tax income, before-tax income, salary If you’re paid a salary, that’s your gross income. Bonuses also count toward gross income. If you’re an hourly worker, the gross income on a pay stub is your hourly wage multiplied by hours worked. Gross wages are also on the W-2 forms received from employers at tax time. Your total gross income can come from many sources in addition to a W-2 job....

Inflation causes a decrease in purchasing power when prices rise more quickly than wages increase. It forces individuals to spend more dollars, euros, or other forms of currency to buy necessities, which can put the average consumer in a financial pinch. It can reduce discretionary spending, too. You would have had to pay $106.80 in November 2021 to buy what could have been bought for $100 in November of 2020, for example....

For example, you might pick a single large-cap stock fund and invest 30% to 40% of your portfolio in it. You would then fill in the remaining 60% to 70% of your portfolio with many smaller investments in other funds or assets. The goal is to achieve above-average returns with below-average risk. Using this type of design, the satellite assets provide diversification, which reduces your risk, while the core asset brings in a large share of your earnings and growth....

What Is My Chase Plan? A My Chase Plan is an installment plan for eligible purchases on Chase credit cards. The plans don’t charge interest, but there is a monthly fee. You can have up to 10 plans active or pending at one time. Repayment terms range from three to 18 months, and Chase will offer you between one and three repayment terms. How Does My Chase Plan Work? Setting up a My Chase Plan is straightforward....

Non-owner auto insurance does not cover a specific automobile, but a particular person. Let’s say you carry a non-owner car insurance policy because you often borrow your friend’s car. If you’re liable for an accident while driving it, your policy can help cover the cost of repairing the other driver’s vehicle. Non-owner car insurance is tied to the policyholder, so if you borrow cars from multiple people, you’re covered, regardless of which vehicle you drive....