WorksheetsSavings Test Reveiw
Total questions: 20
Worksheet time: 10mins
The Rule of 72 tells us?
The Rule of 72 estimates the time to double an investment by dividing 72 by the annual interest rate.
The Rule of 72 is used to find the exact amount of time needed to double an investment.
Which one requires a minimum deposit of $1000 or more and is based on tiered interest rates?
Savings Bond
An example of a long-term goal is a plan to save towards:
Buying a new video game
Replacing a window
Saving for new shoes
The money your investment earns is based solely on the principal (your initial investment)
Compound Interest
Savings
Dividend.
Simple Interest
Which of the following is the most liquid?
Savings Account
Certificate of Deposit
What agency provides the protection that depositors have in savings, checking and certificate of deposit accounts as a member of commercial banks.
The chance you take of making or losing money on your investment is known as:
An individual can begin collecting Social Security benefits at age 62: however,
The payments will be lower than if they wait until full retirement age.
Their spouse will not be eligible to receive Social Security.
Their payments will stop after 10 years.
The income tax rates increase exponetially.
What do a 401(k), 403(b), IRA, and a Roth IRA all have in common?
What is the primary difference between a 401(k) and and IRA?
Only employers contribute to A 401(k).
A 401(k) is employer-sponsored while an IRA is individually acquired.
All of these are retirement accounts except
Medicare
Social Security
The 50/30/20 plan is:
A budgeting method that divides income into 50% for wants, 30% for needs, and 20% for savings.
"Pay yourself first" means:
Compound interest is:
Which is the least liquid?
Money market savings account
Certificate of Deposit
Checking account
Savings account
Spreading funds through a variety of savings and investments to reduce risk is called
Risk
Interest
Diversification
Earnings
The effect of time on interest is:
Decreases the total amount of earnings
Causes Interest to decrease
Doesn't change the total amount of earnings
Increases the total amount of earnings
Which one of the following is NOT a reason to save?
In case of an emergency
To reach financial goals
So you can go into debt
To have the option of taking advantage of unforeseen opportunities
17. Alvin has been contributing regularly to his company's 401(k) plan. He decides to leave the company. It would be financially advisable for him to
move the money from the 401(k) plan into another qualified retirement plan
withdraw the money from the 401(k) plan and use it as an emergency fund
withdraw the money from the 401(k) plan and deposit it in a savings account
use the money from the 401(k) plan to make home repairs
Which represents the BEST time to start saving for your retirement?
Right after you pay off your student loans
As soon as you have your first full-time job
Once you are debt-free, including paying off all credit cards, auto loans, and your mortgage
At age 45, so you have exactly 20 years until retirement
