Identify the difference between money you have and money the bank lends you.
A checking account is a bank account for everyday payments, deposits and withdrawals.
Deposits, payments and withdrawals change the balance. A positive balance is money in the account; a negative balance, or overdraft, is debt to the bank. An overdraft may carry interest. Not all positive balances earn interest, and conditions vary between banks.
There are 200 ₪ in the account. After a payment of 70 ₪, 130 ₪ remain. A credit line is not money you received as a gift.
Identify the difference between money you have and money the bank lends you.
An account shows 500, with a payment of 120 due tomorrow. The displayed balance does not mean that all 500 is available for another purchase. Allowing for that payment leaves 380. Separate money already received, income still expected and payments not yet deducted. This explains why transaction dates matter. A credit limit is permission to borrow under agreed conditions, not extra income that belongs to you.
Concepts that help you compare
What is money?
Money is a common means of payment used to buy things and compare prices. Income is money that comes in, and an expense is money that goes out. A budget helps plan expenses so they fit the income and goals. Savings is the part of income that you set aside for later.
Comparison example: You received 60 ₪ and spent 35 ₪. 25 ₪ remain that you can save for the next goal.
A loan is money you receive with an obligation to repay according to agreed terms. The principal is the amount borrowed. Interest is part of the cost of credit, and there can be additional fees. Check the total repayments, the loan period, the type of interest and indexation. A smaller monthly payment is not necessarily a cheaper loan.
Comparison example: For illustration only: a loan of 1,000 ₪ for one year at a simple interest rate of 10%, with the entire repayment at the end of the year, requires 1,100 ₪ before additional costs.