Financial Literacy Quiz

All of the following are reasons to open a checking account EXCEPT

• Making it easier to pay bills

• The ability to make purchases with a debit card

• Access to cash at an ATM

• All of the above are reasons to open a checking account

Daisy reads her bank statement and finds an error. She should...

• Do nothing. The bank will correct the error at the end of the year.

• Call the FDIC. She is insured up to $250,000.

• Call the bank. The bank will investigate the transaction to see if it was an error.

• Assume that it’s a transaction that she made and forgot about.

What is the most frequently charged fee on checking accounts?

• ATM fees

• Overdraft fees

• Monthly Maintenance fees

• Statement fees

Tyreke has $5,000 to put into an account that earns compound interest. Which of the following is the BEST advice you can offer so that he can maximize interest?

• It’s ok to open an account with a low interest rates as long as you deposit your money early

• Deposit your money as early as possible in an account with the highest interest rate possible

• Wait for interest rates to rise above 3%, otherwise compounding doesn’t have any effect

• Compound interest will not have any effect at such a low dollar amount.

Why is it important to live on a budget?

• Living on a budget will eliminate your expenditures.

• Living on a budget will increase your income.

• Living on a budget will make your life easier.

• Living on a budget will make you a financial adviser.

Kevin receives a $1,000 paycheck. According to the 50/30/20 rule, how much should he put aside for saving?

• $100

• $200

• $500

• $1000

What is a major benefit of the Pay Yourself First strategy?

• It helps you budget all of your income for the entire year

• It encourages you to prioritize saving money

• It is a good way to build credit

• It generates additional income to cover essential expenses

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

Which strategy will help you save the most money?

• Wait until the end of the month and add any money that you have not spent to your savings account.

• On the last day of each month, deposit a fixed $10 to your savings account.

• As soon as you receive your paycheck, put a fixed amount or percentage of your money directly into your savings.

• Wait to deposit into your savings account only when you have a large lump sum of money.

What is the benefit of automating your savings account contributions?

• You can change the amount you deposit each month.

• The fees are relatively small to enroll in this service.

• Your money will be transferred automatically & guarantees you’ll be contributing to your savings (“Set It & Forget It”).

• Your employer will contribute additional money to your savings account if you enroll in this service.