Savings Review

Front

How is wealth defined? Options: How much money you have in your Checking and Saving accounts, Debts - Assets, All assets, including money in the bank + retirement, Assets - Debts

Back

Assets - Debts

Front

Which is NOT a typical goal for a savings account? Options: To create an emergency fund, To pay for higher education, To save for a new car, To buy groceries for this week

Back

To buy groceries for this week

Front

What is a general rule of thumb on how much you should save? Options: 5% of your income, 10% of your income, 20% of your income, 30% of your income

Back

20% of your income

Front

About how much should you save in an emergency fund? Options: 1-3 months of living expenses, 3-6 months of living expenses, 6-9 months of living expenses, 9-12 months of living expenses

Back

3-6 months of living expenses

Front

What is a good strategy to help you save? Options: spend money on all expenses; put the rest into saving, Tap into your savings on a regular basis to purchase small items, like snacks, Pay yourself first - set aside money for savings each month, Keep your spending and saving money together in 1 account

Back

Pay yourself first - set aside money for savings each month

Front

How does the 50-20-30 rule distribute your income?

Back

50% expenses, 20% saving, 30% flexible spending

Front

How is compound interest different than simple interest?

Back

It is simple interest + interest earned on that interest.

Front

Assuming a rate of growth of 8%, in how many years will your $ double? (Remember the Rule of 72)

Back

9 years

Front

At what rate does your $ need to grow in order to double in 18 years? (Remember the Rule of 72) Options: 2%, 4%, 6%, 8%

Back

4%

Front

Saving accounts differ from checking accounts in that...

Back

Money in a saving account can be used to fund a bank's loans.