Saving and Investing

A pool of money collected from many investors, and used to buy stocks, bonds, and other securities.

• stock

• mutual fund

• bond

• goals

Deposit is usually not insured

• investing

• saving

A type of time account

• CD

• stock

• bond

• mutual fund

Bonds are a safer investment than stocks

• True

• False

The Rule of 72 can help you figure out all of the following except

• Interest rate needed to double your money

• The time of year that is best for investing

• Amount of time it will take to double your money

• How many times money will double in a specific time period

The Rule of 72 not only can help you find how long it takes to double money, but also how long it takes for _______ to double.

• savings

• treasury notets

• debt

• penalties

When you deposit money in the bank, you will quickly earn a lot of interest!

• True

• False

When it comes to the stock market, the goal is to . . .

• Buy low and sell high

• Buy high and sell low

How does investing in the stock market differ from putting money in a savings account at a bank?

• Investing is always a less risky option than saving.

• Investing is best for short-term situations like emergency funds; saving is best for the long-term

• Investing allows you to accumulate wealth for retirement while saving is best for short-term purchases or emergencies

Which of the following statements is TRUE about compound interest?

• Compound interest means you have a fund manager who is compounding your returns without charging a fee.

• Compound interest allows you to earn interest not only on the amount you have saved, but also on the interest you've already earned.

• Compound interest always impacts how much you will be charged in fees.