Unit 7 Investments/Retirement

Which of the following is the safest investment because you are guaranteed to make money from it?

• Bank Account

• Stock Market

• Government Bonds

• Insurance

Which of the following people should put more money into stocks?

• Sam who is young, has a good job, and will not retire for another 30+ years.

• Ricky who has two kids in college and is paying for their education.

• Penny who does not make a lot of money and can’t afford to lose her savings.

• Lionel who is 65, retired, and living on a fixed income.

What it one benefit that Traditional 401Ks have over Individual Retirement Accounts?

• You can take out the money before you are 59.5 years old.

• You will never have to pay taxes on that money.

• Your employer may match your contributions – so you save more money!

• You will never have to pay penalties for taking the money out.

Bonds are a way to raise money for which of the following groups?

• Banks

• Small Businesses

• Governments

• Teachers-Yay!

How do big businesses (corporations) raise financial capital?

• Through pervasive financial intimidation.

• By collecting sales tax revenue.

• By selling stocks.

• Through double taxation.

What is one benefit of mutual funds over individual stocks?

• Mutual funds are not invested in the stock market so they are not risky.

• Mutual funds are invested in a variety of stocks and bonds to limit your risk.

• Mutual funds cost less than individual stocks.

• Mutual funds are guaranteed to earn more money that individual stocks.

Which type of investment can earn the most return in the long-run?

• Certificates of Deposit

• Bonds

• Stocks

• Savings Accounts

Which of the following are good investments because they typically appreciate in value, or are worth more money over time?

• Cars

• Boats

• Homes

• Cell phiones

Why is a Roth IRA a better option for young savers over a Traditional IRA?

• You will get tax deductions every year.

• You will not have to pay the taxes on that money when you retire (and taxes will probably go up!)

• You can save more money every year.

• There is less paperwork to complete in order to sign up.

To buy a $100 savings bond you would pay...?

• $100

• $50

• $25

• $200