Saving Review

How is wealth defined?

• How much money you have in your Checking and Saving accounts
• Debts - Assets
• All assets, including money in the bank + retirment
• Assets - Debts

Which is NOT a typical goal for a savings account?

• To create an emergency fund
• To pay for higher education
• To save for a new car
• To buy groceries for this week

Which of the following is FALSE about saving and investing? (hint: choose 2 correct answers)

• Saving doesn't outpace inflation; investing usually does

• Both saving and investing generally have low returns

• Saving is for short-term; investing is for the long-term

• Saving has more risk; investing has less risk

What is 50/30/20 budget rule stands for?

• 50% on needs, 30% on wants and 20% on savings

• 50% on wants, 30% on savings and 20% on needs

• 50% on savings, 30% on needs and 20% on wants

• 50% on wants, 30% on needs and 20% on savings

What is a general rule of thumb on how much you should save?

• 5% of your income
• 10% of your income
• 20% of your income
• 30% of your income

About how much should you save in an emergency fund?

• 1-3 months of living expenses
• 3-6 months of living expenses
• 6-9 months of living expenses
• 9-12 months of living expenses

What is a good strategy to help you save?

• 1st, 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

What is a reason for why so many Americans live paycheck-to-paycheck?

• Many people are paying themselves first and then spending

• Many people only buy what they NEED, not what they WANT

• Many people impulse shop

• Many people spend within their budget

Assuming a rate of growth of 8%, in how many years will your $ double?

• 3 years
• 6 years
• 9 years
• 12 years

How does inflation impact the money in your savings account?

• Inflation decreases only the $ you earn in interest
• Inflation increases the value of the money in your account
• Inflation has no impact on $ in your savings account.
• The purchasing power of your money decreases over time