Financial Literacy Basics

Front

What famous person stated that "Compounding is the 8th Wonder of the World?"

Back

Albert Einstein

Front

Rule of 72

Back

A formula for figuring out how long it takes for your money to double.

Front

What is the Rule of 72 formula?

Back

t = 72 / r

Front

What does the letter "t" stand for in the Rule of 72 formula?

Back

The time it takes for your money or investment to double

Front

What does the letter "r" stand for in the Rule of 72 formula?

Back

rate

Front

The "t" in the Rule of 72 formula can best be described to mean what?

Back

The amount of time it takes for your $ to double.

Front

What's the most important factor to consider when it comes to compounding your money?

Back

Time is the most important factor - the sooner you start the more time your $ has to compound.

Front

With the Rule of 72 formula, the rate must be __________.

Back

Fixed

Front

Inflation is best described as ____________.

Back

a loss of purchasing power

Front

What is the best way to protect yourself from inflation?

Back

By owning assets that hold their value over time.