Savings Quiz

When it comes to saving money, what is a good rule of thumb?

• keep most of your savings in your checking account
• put aside money for savings each month
• choose the savings account with the lowest interest rate
• putting anything you can't afford on your credit card

The purpose of a budget is to :

• help you plan how you will spend the money you earn or receive
• stop you from spending too much
• increase the balance of your savings account
• tell you how much you owe the government in taxes

Which of the following accounts will give you the LEAST access to your money?

• simple savings account
• Certificate of deposit
• checking account
• all of the above

Which of the following savings vehicles usually requires a high minimum balance?

• simple savings account
• Certificate of deposit
• checking account
• all of the above

Which of the following is generally true about savings vehicles?

• savings vehicle are only useful for long-term investments
• people should evaluate different forms of savings vehicles based on their needs
• savings vehicle are never insured
• all of the above

Which of the following is a type of savings vehicle?

• certificate of deposit
• money market account
• checking account
• both a & b

You are opening a savings account that earns compound interest. Which compounding frequency will earn  you the most money?

• compounding 1 time a year
• compounding 4 times a year
• compounding monthly
• compounding daily

John just opened a savings account and wants to mazimize the amount of interest he earns. Which of the following actions enable him to earn MORE interest?

• selecting an account with a higher interest rate
• leaving his money in the account for long period of time
• transferring money into his checking account each month
• both a & b

To earn as much interest as possible, you should open a savings account that earns ______ interest and has the _____ interest rate.

• compound; lowest
• compound; highest
• simple; lowest
• simple; highest

Interest is:

• a charge for lending money
• the amount owed for borrowing money
• the amount added into your savings account when opening a bank account
• a charge for convenience of accessing money in your bank