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WorksheetsInvesting and Retirement
Total questions: 37
Worksheet time: 21mins
If you leave a job and have money saved in your employer's retirement plan, always roll that money into an IRA using direct rollover, which allows you to avoid taxes and penalties.
True
False
A mutual fund portfolio that is properly diversified will have all investment dollars located in just one of four different classes of financial assets.
True
False
Savings accounts and money-market accounts are most appropriate for:
Long-term investments like retirement
Earning a high rate of return
Emergency funds and short-term goals
You should start investing as soon as you have your college education funded.
True
False
The benefit of diversification in investments is:
Increased risk
Reduced risk
Increased return
Saving and investing have nothing to do with the amount of money you make.
True
False
A reason people need to save and invest is:
Enable their money to make money
Increase their money supply
Be able to get anything they want
Quality of an asset that permits it to be converted quickly into cash without loss of value; availability of money
Liquidity
Risk
Money that is invested, either tax deferred or tax free, within a retirement plan
Dividend
Tax-favored
Single stocks and mutual funds carry the same amount of risk.
True
False
To ensure that some of your retirement savings will not be subject to income tax upon withdrawal, contribute to:
401(k)
A Roth IRA
A traditional IRA
A retirement plan found in nonprofit organizations such as churches, hospitals, and schools.
401(k)
457
403(b)
Securities that represent part ownership and equity in a corporation:
Stocks
Bonds
If you get into financial trouble, borrowing against your retirement plan is a good option.
True
False
List of investments:
Statement
Liquidity
Portfolio
You can start investing with a small amount of money.
True
False
Good investment portfolios are extremely complex.
True
False
Money markets are great for your emergency fund due to their liquidity and stability.
True
False
Piece of ownership in a company, mutual fund, or other investment.
401(k)
Dividend
Share
A savings account sold by an insurance company, designed to provide payments to the holder at specified intervals, usually after retirement.
Viatical
Annuity
Money market
Stock
In some cases, employers will match the employee contribution. This statement refers to:
401(k)
Stocks
Roth IRA
Bonds
Liquidity refers to how quickly an investment can be converted to cash.
True
False
When it comes to compound interest, __________ makes the most difference in your future value.
Compounds per year
Principle- invested amount
The years invested
A money-market account is the least liquid investment option.
True
False
Typically purchased because viewed as "patriotic"
Mutual Funds
Bonds
Stocks
Stock is a small percentage of _______ in a company.
Profit
Ownership
Rights
Investing is suppose to be a _______ strategy.
Short term
Long term
Get rich quick
Retirement
Diversification is
All your eggs in one basket
Investing in one of four stock
Lowering risk
Mutual funds are a good choice because:
Professionally managed
Affordable
Diversified
_______: Life or length of bond
Maturity
Term
Investors do not buy shares in mutual funds.
True
False
A bond is, simply put, a loan.
True
False
Professionally managed means:
You need to know all the details beforehand
You just contribute, and it's handled appropriately
You must research and keep up with the markets
Who is loaning money when it comes to bonds?
Banks
Businesses
Companies
You
Shares AND stock prices are determined by supply and demand
True
False
The easiest way to invest with little knowledge is:
Stocks
Bonds
Mutual funds
Real estate
Commodities are raw materials that are needed for a sustainable life.
True
False
