Personal Financial Planning Quiz Review

What is the first step in personal financial planning?

• Creating a budget

• Opening a savings account

• Setting financial goals

• Investing in stocks

Which of the following is considered a fixed expense?

• Clothing

• Groceries

• Rent

• Entertainment

A 401(k) plan is a ________.

• special type of business plan

• bank account specifically for entrepreneurs

• benefit that helps workers invest for retirement

• bank account specifically for bankers

How can you invest for retirement if your employer does not offer a 401(k) plan?

• Open a 401(k) from a relative’s employer

• Open an Individual Retirement Account or IRA

• Open a 501(c)(3) instead

• You simply wouldn’t be able to invest

What is a living will?

• A plan to care for someone who is young or incapacitated and cannot care for investments

• A plan to care for someone who is young or incapacitated and cannot care for their pets

• A plan to care for someone who is young or incapacitated and cannot care for themselves

• A plan to care for someone who is young or incapacitated and cannot care for their property

What are two significant advantages of a 401(k) over an IRA?

• You can get free international money and you can contribute more per year.

• You can get free money through a government match and you can contribute more per year.

• You can establish your own business.

• You can get free money through an employer match and you can contribute more per year.

Who can help with estate planning?

• All of the above

• Attorneys

• Financial institutions

• CPAs & CFPs

What is a statement of financial position?

• A financial statement that describes an individual or family’s financial condition on a specified date by showing assets, liabilities, and net worth

• An employer-sponsored plan that you contribute some of your salary to before taxes. Your employer may match contributions.

• A retirement account anyone can open that you fund with pre-tax dollars. You pay taxes when you withdraw the money.

• An employer-sponsored plan that pays out a set amount every year after you’ve reached retirement age.

It is a bad idea to get a credit card

• True

• False

What is the life expectancy of Americans?

• 79 years

• 79.3 years

• 65 years

• 85 years