The amount of money you save depends on how much money you earn. Simply put, you will save more when you earn more.True or False
A savings account at your bank is the best place to put your emergency fund. True or False
The two biggest factors in compound interest and building wealth are time and the initial amount of the investment. True or False
It is okay to use your emergency fund to pay cash for big purchases such as a TV or a cell phone. True or False
You should pay yourself first before you pay bills. True or False
Saving money for a purchase and letting the interest work for you rather than against you
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Money is neither good nor bad
Emergency fund goes here
Interest on interest
If it can go wrong, it will; unexpected events
$500/$1000 in an emergency fund
Baby step 1
3-6 months of expenses
Baby step 2
Key to wealth building
For most people, a fully-funded emergency fund will be about
Ben and Arthur illustrate which principle of saving
Saving and emergency fund
Baby steps 1 and 3 have to do with
emergency fund, purchases, and wealth building
You should save for
How many baby steps are there
Saving is about contentment and
Stands for Personal Account Coordinator and Pre-Authorized Checking
The following is true about PACs
The saving habits of Ben and Arthur help to illustrate the principle of compound interest. True or False
Dave’s 80/20 rule says when it comes to money, 80%is head knowledge and 20% is behavior. True or False
Your income level greatly affects your savings habits. True or False
Interest is money paid to a saver by a financial institution. True or False
The correct order for using your money is pay bills, save, then give. True or False
Advertising and marketing
Why do you think the United States has a negative savings rate?
Calculate the compound interest for the problem: $1000 at 6% interest for three years. FV=PV(1+r/m)^mt
Calculate the compound interest for the problem: $500 at 18%for four years. FV=PV(1+r/m)^mt
Calculate the compound interest for the problem: $1500 at 12% for two years. FV=PV(1+r/m)^mt
Purchases, emergency fund, wealth building
What are the three primary savings goals?
To stay out of debt
Why do you need an emergency fund at your age?
So you don’t have to borrow money
Why do you need to have $1000 in the bank before paying off debt?
Growth and income funds
5-10 year track record
Always check this record when investing
Spread around the risk
Piece of ownership in company stock
List of your investments
Rental real estate
Least liquid of all investments
Degree of uncertainty of the return on an investment
Aggressive growth funds
Savings account within an insurance company
Risk return ratio
Risk goes up, return goes up
Liquidity means to spread around and lower risk. True or False
A single stock is the best place to keep your emergency fund. True or False
A CD is the best place to keep an emergency fund. True or False
Diversification lowers your risk with investing. True or False
Commodities and futures are extremely speculative and carry a high risk. True or False
_____% or any 10-year period in the stock market has made money
Growth, growth and income, international, aggressive growth
Long-term investments properly diversified include the following mutual funds
Keep it simple stupid
What is the KISS rule of investing?
Gold, viaticals, futures
What are examples of bad investments
The more liquid an investment, the less return
What is true about liquidity?
What is not a type of annuity? Fixed, stable, variable.
A savings account with a certificate is a
So you have a better idea of what to expect
Why do you look at the long-term track record with a mutual fund?
Single stocks, gold, CDs, bonds
What are some investments that don’t give you a high rate of return?
Gold, commodities, day trading, viaticals
List four types of investments that you should always avoid.
Mutual funds will diversify. Mutual funds are the better investment
How are single stocks different from mutual funds and which is the better investment?
Retirement plan for self-employed people
Grows tax free
They typical retirement plan found in most corporations
Used for college savings
The typical retirement plan found in non-profit groups such as schools and hospitals
Pre-tax means the government is letting you invest money before taxes have been taken out
Savings bonds are a good way to save for college
Never borrow money from your retirement plan
When you leave a company, don’t move your money from the retirement account
An IRA is a specific type of investment
The _____ IRA grows tax free
An educational savings account is used for
Which of the following is not a retirement plan? 529, 401K, 403B, 457
What is not a benefit of the Roth IRA?
If your company provides a 100% match up to 6%, how much should you personally contribute to your 401K if you earn $35,000?
If you contribute $2300 to your 401k and your company matches up to 3%, how much is in the account?
What should you do with your retirement accounts when you leave a company?
Pre-paid tuition and savings bonds
Never save for college using
Baby step 5 is
If carol and joe are debt free, how much should they be investing in retirement plans if their combined income is $145,000
What are the advantages of Roth IRA?
Invest 15%. So you don’t have to borrow money
What is baby step 4 and why does your emergency fund have to be fully funded before you being this step
Scholarships, work study
What are some ways you can avoid student loan debt if you do not have a college fund?
Companies will match your money with a 401K
Why should you take a 401K match before you start a Roth IRA?