Unit 6 / Saving & Investing / Review

What makes investing different from saving?

• Investing usually is a term of 0-5 years

• Investing includes cash and money market accounts

• Investing is about accumulating wealth over the long term

Which saving/investing type involves the least amount of risk?

• Cash

• Savings Account

• Stocks

T / F: Many experts that study the stock market can "beat the market", so it's best to invest with an expert even if it costs you more money.

• True

• False

When is it best to start saving for retirement?

• after your home is paid off

• after you get a promotion

• after you get your dream job

• ASAP

T / F: Roth IRAs are available through your employer.

• True

• False

As you get older, more / less of your portfolio should be invested in the stock market (compared to bonds).

• more

• less

According to the Rule of 72, how long will it take an investment earning 6% to double?

• 6 years

• 8.3 years

• 12 years

• The answer cannot be found with this information.

This individual retirement account uses post-tax dollars. Money is not taxed when taken out in retirement.

• Traditional IRA

• Roth IRA

• 401(k)

Which saving/investment type involves the greatest risk?

• Cash

• Savings Account

• Bonds

• Stock Market

Investments are volatile and returns vary each year. This is because investing is a(n) ________.

• Risk

• Neccessity

• Asset

• Portfolio