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WorksheetsPF MID TERM STUDY GUIDE
Total questions: 102
Worksheet time: 53mins
Generally, the more education you receive, the higher your lifetime earnings will be.
TRUE
FALSE
There is no relationship between the level of education received and lifetime earnings.
True
False
For most careers, which degree will most likely result in the highest lifetime earnings?
High School
Associates Degree
Licensure or Certification
Bachelor's Degree
What is net pay?
The amount of pay earned for the total number of hours worked
The amount of money you're paid after all taxes and deductions are taken out of your paycheck
The amount of money you're paid before all taxes and deductions are taken out of your paycheck.
Your gross pay plus any bonuses.
Net pay is not
The money that you take home on your paycheck.
Your gross pay plus any bonuses.
Less than gross pay
The amount of money you're paid after all taxes and deductions are taken out of your paycheck.
Which of the following is NOT a possible tax or deduction that they may show up on your paycheck?
Federal income tax
Contributions to retirement savings
FiCA
Overtime
What is the purpose of the W-4 form?
To file your income tax return
To determine how much your gross pay should be
To inform your employer of how much federal income tax to withhold from your paychecks
To avoid paying income taxes
When you fill out a W-4 form, you must state whether you are:
Married
Single
Head of Household
All of the above
Your employer sends you a _____ form that tells you how much you've made and how much you've paid in taxes in the last year.
1040
W-2
W-4
W-9
What does the W-2 form tell you?
How much you've earned and how much taxes you've paid in the last year
When to file your tax return
How much federal income tax your employer will withhold from your paycheck
How often your employer will be paying you
The W-2 form is a form that tells you ________.
How much you've earned and how much taxes you've paid in the last year
How much taxes you owe the government
How much federal income tax your employer will withhold from your paycheck
How often your employer will be paying you
Which of the following statements is true about taxes?
Taxes pay for schools and government departments
Taxes pay for roads and emergency services
Taxes are often used at the federal, state, and local levels.
All of the above
What do taxes pay for?
Taxes pay for schools and government departments
All of the above
Operating a financial institution
Privately owned business
How does the government pay for roads, schools, and emergency services?
They are funded through non-profits
They are funded through private businesses.
They are funded through charitable donations.
None of the above.
The __________ is a flexible market that allows you to work short-term, independent jobs?
Gig economy
Labor market
Employee workforce
Sharing economy
What is the gig economy?
The total availability of employment and labor in the economy.
An economic system in which assets or services are shared between individuals.
A flexible market that allows you to work short-term, independent jobs
The music industry opportunities
What do you need to fill out your 1040?
Your W-2
Your routing and bank account number
A record of any other supplemental income
All of the above
Which of the following do you NOT need to fill out your 1040?
Your credit card statement
Your job offer
None of these options are needed.
Your employer benefits documentation
When considering a job offer, you should only consider your gross income.
True
False
Which of the following is NOT considered part of your benefits package available from your employer?
Disability insurance
Paid time off
Healthcare insurance
All of these are considered part of a benefits package.
Benefits packages do not include equipment and technology needed for you to perform your duties.
True
False
OPEN RESPONSE: (10 POINTS). If you could only have one employee benefit from a full-time job, which would it be of the following: 1. Health care, 2. Paid vacation, 3. Disability insurance, or 4. Retirement savings? Give reasons why that one would be important to you. **At least 4 sentences for full credit. Each sentence will be graded on grammar and content.
Which of the following is a benefit of using a budget?
Helps to keep track of the money you receive
Helps to prioritize your spending
Helps reach short- and long-term financial goals
All of the above
Which of the following is NOT a benefit of using a budget?
A budget can help you purchase anything you want.
A budget can help you keep track of your money.
A budget can help you make plans to reach your financial goals.
A budget can help you decide the importance of your expenses.
Why is using a budget beneficial?
Helps to keep track of the money you receive
Helps to prioritize your spending
Helps reach short- and long-term financial goals
All of the above
Which of the following should NOT be considered when setting a current budget?
Your financial goals
Future income
Needs and wants
Savings
Which of the following should you consider when setting a budget?
Your financial goals
Needs and wants
Savings
All of the above
What should be considered when setting a budget?
Needs and wants
Savings
Time management goals
Needs, wants, and savings
___________ are good places to look to find your current expenses when building your budget.
Banks and credit unions
Grocery stores and concerts
Bank and credit statements
Online research websites
Where should you look to find your current expenses when building your budget?
ask your parents
your wallet
bank and credit statements
your bank representative
Bank statements, credit statements, and records of cash expenses help you to estimate your ________.
credit score
emergency fund needs
expenses
available investments
In addition to needs, what should you plan for first when creating a budget?
Possible charitable donations
Shopping money
Investments
Recurring expenses
In your budgeting process, when should you look at recurring expenses?
Before reviewing your wants
After considering entertainment expenses
Before looking at your needs
After your wants but before you needs
Which of the following statements is TRUE?
Recurring expenses don't need to be planned for because they rarely happen.
Recurring expenses are expenses that can never be stopped.
Recurring expenses should be planned for after looking at your wants.
None of these
Which of the following is a way to track your spending?
Spreadsheet budget
Envelope method
An app
All of these
The envelope method, notebook and pencil, and online software are all methods of ______.
planning for your future
understanding your current expenses
estimating your unexpected expenses
tracking your spending
Which of the following is NOT a good way to track your spending?
In your head
Notebook and pencil
Envelope method
Online software or app
Which choice or choices best describes the purpose of an emergency fund?
An emergency fund prepares you for unexpected expenses.
An emergency fund keeps you from borrowing money from friends and family.
An emergency fund removes the worry about expenses not in the budget.
All of these are good reasons to have an emergency fund.
Which of the following is NOT true about emergency funds?
They are used for anything listed on the budget.
They can keep you from borrowing money from friends and family.
They help you prepare for unexpected expenses.
They help remove the worry about expenses not in the budget.
This helps you prepare for unexpected expenses.
Credit cards
Checking account
Emergency fund
None of these
When setting a budget, you can choose to make room for:
Financial goals
Entertainment expenses
Charitable donations
All of these
Charitable donations, entertainment expenses, and financial goals are all examples of...
activities that contribute to overspending.
things that are considered needs.
activities that are necessary for a healthy lifestyle.
things to consider when creating a budget
When setting a budget, you should consider...
financial goals, current expenses, and income
mostly income.
creative ways to spend your money.
mostly your goals.
Unexpected expenses...
can make it hard to stick to your budget.
may cause you to be unable to pay necessary bills.
should be planned for.
all of these
Which of the following is TRUE regarding unexpected expenses?
They usually don’t affect your budget.
They should be planned for
They usually don't affect your ability to pay bills.
They should not be included in your budget.
What is NOT true about unexpected expenses?
They do not occur if you have a budget
They could impact your budget in a negative way.
They could interfere with your ability to pay your bills.
They should be planned for so that you can keep within your budget.
Which of the following expenses would be a good reason to spend money from an emergency fund?
Repair your laptop that you use for homework.
Upgrade your phone to the latest model.
Buy new track shoes because they’re in style.
Purchase concert tickets to see your favorite artist.
An emergency fund should NOT be used for...
fixing a blown tire on your car that you use to get to work.
repairing your laptop that you use for homework.
a last-minute school trip
a sudden health issue that needs care.
An unanticipated expense that will make it difficult to get by day-to-day would be a candidate for...
spending money from your “rent” envelope
emergency fund spending
tracking all of the money you spent in a month.
getting an extra job so you can have money to cover that expense.
What is NOT a good way to prevent unnecessary spending?
Cancel any unused recurring expenses like subscription boxes
Use and app to find the cheapest gas station
Make your own food more often
Buy all of your wants at one time
How can you ensure you don't go over your budget?
Round up your expense estimates to add a buffer
Use most of your budget for entertainment expenses
Find a friend that enjoys going shopping
Buy all of your wants at one time.
What budgeting tip(s) would help you to stay on track financially?
Find a friend with similar goals and hold each other accountable
Put aside fun money in your budget so you're not missing out
Only use your closest gas station to fill up gas
All of these
Select all that are NOT a common feature of a financial institution.
Access to investment products
Paper Checks
Access to ATM's
Direct deposit
Investment trading
Select all TRUE statements about checking cashing companies.
They have limited operating hours during the day.
They delay your access to your cash.
They can make it easy to fall into a loan cycle that is hard to get out of.
They can take a percentage of your check on top of the fees.
None of the above
Which type of bank acccount typically offers the least (if any) interest?
Checking account
Savings account
Money market account
Certificate of deposit
A savings account typically offers more interest than what type of account?
Retirement account
Money market account
Checking account
Certificate of deposit
Which type of bank account is best for everyday transactions?
Checking account
Savings account
Money market account
Certificate of deposit
A savings account typically offers more interest than what type of account?
Retirement account
Money market account
Checking account
Certificate of deposit
Which type of bank account is best for everyday transactions?
Checking account
Savings account
Money market account
Certificate of deposit
A savings account that compounds interest daily will earn a higher return than a savings account that pays simple interest daily.
TRUE
FALSE
Which savings account will earn you the least money?
One that compounds interest daily.
One that earns simple interest monthly
One that earns simple interest daily
One that compounds interest monthly
Which savings account will earn the most money?
One that compounds interest daily
One that earns simple interest monthly
One that earns simple interest daily
One that compounds interest monthly
Select all the reasons it is important to reconcile your bank statements.
To avoid spending more than you have.
Use only the bank's ATM machines to withdraw money.
To detect any errors in your account.
All of the above
When you purchase a Certificate of Deposit, you are ______________ money from/to the bank
lending
borrowing
How can you avoid spending more than what is in your bank account?
Check your bank statement once a month
Ask your financial institution to notify you when you are close to $0 in your account
Keep your own records to compare with your financial institution's records.
Contact your financial institution to read your transactions to you for the past month over the phone.
None of the above.
Select all TRUE statements about savings accounts.
Savings accounts do not usually pay interest on your deposit.
Savings accounts can limit the number of withdrawals per month.
Savings accounts are best used to store money for longer goals
Savings accounts do not usually require a minimum balance.
None are true
Select all TRUE statements about investing.
Investing is riskier than putting money in a savings account
Investing is good to make a quick profit
Investing is best for long term goals like retirement.
Investing allows you to earn a little interest while keeping your money safe.
All True
A stock is a share of ownership in a company that pays interest like a savings account.
TRUE
FALSE
A mutual fund is a type of investment that reduces risk by investing heavily in one market or industry.
TRUE
FALSE
When you purchase a bond from a company, you are lending the company money for a set interest rate and a set period of time.
TRUE
FALSE
If you use the same bank as your employer, it can sometimes take up to 3 business days to gain access to your money.
TRUE
FALSE
What does the FDIC do for the bank's customers?
It insures to the bank's customers that the bank is treating their customers fairly.
It insures to the bank's customers that the bank is open every day but Sunday.
It insures to the bank's customers that if the bank runs out of money for any reason, their money will be guaranteed by the U.S. government.
All of the above
None of the above
When you purchase a Certificate of Deposit, you receive a higher interest rate because you have committed to keeping your money in the account for a specified period of time.
TRUE
FALSE
When you earn compound interest, you earn money on any interest earned up to that point from your principal.
TRUE
FALSE
A bond is an investment in __________, and it earns ___________.
equity, dividends
equity, interest
debt, dividends
debt, interest
A stock is an investment in ______________, and it earns _____________.
Debt, interest
Debt, dividends
Equity, interest
Equity, dividends
Which of these is the correct way to calculate savings
Expenses-income=saving
savings-income=expenses
Income-savings=savings
Income-expenses=savings
If an expense can NOT be removed from your budget to save money, it is considered a _____.
Income
Want
Need
Savings
If an expense can NOT be removed from your budget to save money, it is considered a _____.
Income
Want
Need
Savings
Which one is a fixed (same amount, same time) payment?
food
power
mortgage
petrol
Which of the following is generally the most expensive category in a person’s budget?
Healthcare
Clothing
Transportation
Housing
If an expense can be cut from your budget to save money, it is considered a ______.
want
need
income
savings
A financial plan is called a
budget
tax
allowance
income
The amount of money you make is called:
Taxes
Net Pay
Gross Pay
Available Pat
In budgeting which number should always be the largest?
Gross Income
Net Income
Taxes
Disposable Income
Another name for an overdraft fee is non-sufficient funds.
true
false
Outstaning checks are checks written by the account owner but have yet to be processed by the bank.
True
False
You are opening a savings account that earns compound interest. Which compounding frequency will earn you the MOST money?
Compounding 1 time per year
Compounding quarterly
Compounding monthly
Compouding daily
Which type of account is typically the most liquid?
Checking account
Savings account
Certificate of Deposit
Exchange Traded Fund
Which type of financial institution typically has membership requirements?
Credit Union
Online Commercial Bank
Commercial Bank
Federal Reserve Bank
Savings accounts usually offer____ interest rates than checking accounts. It is ______ to access your money in a savings account than in a checking account
lower;harder
lower;easier
higher;harder
higher;easier
Which type of account will typically have the highest interest rate?
Checking account
Savings account
Money Market account
Certificate of Deposit
Which of these fees would likely be the highest
Overdraft fee
Account transfer fee
Monthly service fee
ATM fee
