Banking

1. How much money should you try to save in your emergency fund?

• 3-6 days worth of expenses
• 3-6 weeks worth of expenses
• 3-6 months worth of expenses
• 3-6 years worth of expenses

2. Which of the following is an effective strategy for personal saving?

• Wait until the end of the month and save whatever is left in your checking account
• Save a certain percentage of each paycheck and deposit it directly into a savings account
• Cover all of your wants and needs and save whatever is left over
• Take out a payday loan so you can save before you receive your paycheck

3. Joelle wants to have an emergency fund to cover 6 months of her expenses. Her monthly gross pay is $4,000 and her monthly expenses are $2,000. If she plans to save 10% of her gross pay each month, how long will it take her to build her emergency fund?

• 3 months
• 9 months
• 24 months
• 30 months

4. All of the following statements about bank accounts are true EXCEPT…

• If the bank account is FDIC-insured, your money is safe even if the bank fails
• Many banks pay interest on the money you deposit into your savings account
• Historically, savings accounts earn higher returns than investments in the stock market
• Money in a checking account is usually easy to access via ATM, debit card or check

6. You are developing a savings plan and using short-, medium-, and long-term goals to motivate you. Which represents possible goals from short-term to long-term? Save for…

• Retirement, a house down payment, college tuition
• A new cell phone, college tuition, a house down payment
• A new cell phone, dinner with friends this weekend, a new bike
• Retirement, college tuition, a vacation

9. Which of the following statements is TRUE?

• The majority of Americans have an adequate emergency fund
• The majority of Americans have sufficient amounts of money saved for retirement
• The majority of Americans have an adequate emergency fund, but do NOT have sufficient amounts of money saved for retirement
• The majority of Americans do NOT have an adequate emergency fund or sufficient amounts of money saved for retirement

11. Which of the following is an example of online bill pay?

• Using a person-to-person app to repay your friend for dinner
• Using a mobile payment service to purchase your groceries at a store
• Having your paycheck direct deposited into your bank account
• Having your bank send your rent to the landlord each month

13. You overhear your Aunt Tina tell your mom that she, her husband, and their kids are "living paycheck to paycheck." What does Aunt Tina mean by that?

• Aunt Tina gets a paycheck one month, and her husband gets a paycheck the next month; they alternate pay periods
• Aunt Tina and her family don't have any money saved, and their paychecks are just barely covering monthly expenses
• Aunt Tina and her family have high paying jobs and don’t worry much about money
• Aunt Tina only receives paper paychecks instead of direct deposit

14. You are at the checkout counter at the local supermarket and use your debit card to pay for your groceries. Where does the money for this purchase come from?

• Your credit card company covers the cost
• It is deducted directly from your checking account
• Your credit card company provides you with a cash advance to cover the cost
• It is deducted directly from your savings account

15. Fill in the blanks: If inflation is _____________ our savings account interest rate then you will be ______________ purchasing power.

• Higher than, gaining
• Higher than, losing
• Equal to, gaining
• Lower than, losing