Planning for Your Future EVERFI GROW

What type of expenses should you make a savings plan for?

• Monthly phone bill

• A special trip with friends

• Monthly car insurance bill

• Weekly grocery costs

A short-term goal takes how long to achieve?

• Less than 1 month

• Less than 5 months

• Less than or up to 1 year

• More than 5 years

Which is an example of a long-term goal?

• Saving for a new phone

• Getting a bachelor's degree

• Saving up for a down payment on a house

• Saving for a new computer

Jorge and Alma are talking about savings and investing. Alma explains that she puts 15% of her pretax pay into her retirement savings. She explains that not only does she have that money, but she also earns interest on both the money she's saved and the previous interest she's accrued. What is Alma describing?

• Inflation

• Compound interest

• Withdrawal penalty

• Principal

Why is it important to list and prioritize your short-, mid-, and long-term goals ahead of time?

• So you know where all of your money is going

• So that you can buy all the items you want

• So you give yourself time to save for them all

• So that you don’t spend any of your money

What is the main reason you should start saving for retirement as early as possible?

• So you have enough time to decide where you would like to retire

• So that you can enjoy your money while you’re young and able to spend it

• To give your money time to grow with compound interest

• To ensure that you save enough money to travel the world

Which of the following should an emergency fund be used to pay for?

• Monthly bills

• Car repairs

Starting amount: $500 Years to invest: 40 Additional contributions: $100 per month Average annual rate of return: 7.6% compounded annually Total amount invested: $48,500 Ending investment balance: $289,279.40 This demonstrates why it’s important to ________________.

• let your savings grow over time

• invest in high-risk stocks

• withdraw your savings early

• avoid making additional contributions