Savings Account

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

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

Which is TRUE about online saving accounts? (hint: choose 2 correct answers)

• Usually have higher interest rates than non-online accounts

• They usually have lower costs compared to brick-and-mortar banks

• Online accounts are not FDIC insured

• You can withdraw money an unlimited # of times

Saving accounts differ from checking accounts in that...

• Money in a saving account can be used to fund a bank's loans
• Saving accounts let you withdraw $ an unlimited # of times
• Saving accounts come with more fees than checking accounts
• Checking accounts offer higher interest rates

What might you need to open a savings account? (hint: choose 2 correct answers)

• Minimum opening deposit

• Your previous year's tax returns (or your parents')

• The routing number to a checking account

• Identification

True or False: You need a checking account to open a savings account.

• True
• False

Which is TRUE about Certificates of Deposit (CDs)? (hint: choose 2 correct answers)

• You agree to keep $ in a CD for an undetermined period of time

• You pay the bank some interest to keep $ in the CD

• The bank can loan out the $ in your CD

• The bank pays you interest in return

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