CFL Unit 3 Study Guide

What are savings?

• The extra money you have laying around

• Portion of income not spent on consumption

• A type of stock account

• Money you can't be taxed on

Saving results in savings.

• False

• True

What is the phrase that describes cash set aside in case of unexpected events? (Type in all lowercase)

Which is NOT a short term goal?

• Making a monthly budget

• Starting a personal balance sheet

• Saving for a house

• Building emergency fund

About how many months of expenses should be in your emergency fund?

• 12 months

• 1-2 months

• 5-8 months

• 3-6 months

How much money that should be put in an emergency fund depends on your income, dependents, job security, and insurance coverage.

• True

• False

To increase income, decrease _________? (Type in all lowercase)

The less specific the goal, the better.

• False

• True

What's it mean to pay yourself first?

• You are self employed

• The certain amount of money deducted from your taxes

• You have to pay fees to yourself

• Saving a predetermined amount of money.

Money available at the present time (today) is worth more than the same amount received in the future.

• True

• False