MoneyU Glossary of Terms

MoneyU Glossary of Terms

Browse the glossary using this index

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Something that must be done because of legal or moral duty.

Opportunity cost

The foregone benefit of the next best alternative when an economic decision is made. In other words, the benefits you could have received by taking an alternative action.

Outstanding Balance

The total amount that you owe on a credit card or other loan.

Over the Credit Limit

When the amount you owe is more than the limit on your credit line. Any combination of purchases, cash advances, fees or finance charges may cause you to exceed your credit limit. For example, you will be over the credit limit if you spend $2,000 when you have $1,000 of your credit line left. If you go over your credit limit, you will be charged an extra fee each month until the amount of money you owe is less than or equal to your credit line.

Over-the-Limit Fee

A charge imposed for exceeding the assigned credit limit.

Overdraft Agreement

Some issuers allow you to link your credit card to a checking or savings account that you hold with that bank. When you sign an overdraft agreement and you bounce a check, the bank can charge that amount to your credit card account and the check will clear. This way, you avoid a returned check fee.