WorksheetsGrow: Financial Planning for Life Quiz
Total questions: 47
Worksheet time: 35mins
What is the definition of 401(k)?
An employer-sponsored account where employees can save money from each paycheck to be used in retirement.
An individual savings plan managed solely by the employee without any employer contributions.
A government-managed retirement fund funded by taxes.
A bank-managed investment account specifically for saving money for daily expenses.
What is the definition of 403(b)?
A retirement plan for the benefit of employees of public schools, some hospitals, and certain tax-exempt organizations.
A savings account for personal expenses during retirement.
An insurance policy for the protection against retirement risks.
A government-sponsored pension plan for federal employees.
What is the definition of Asset?
Property owned by a person that has value and could be used to pay off debt.
A financial obligation or debt owed to another party.
A source of income that generates regular cash flow.
An expense incurred in the process of earning revenue.
What is the definition of Appreciation?
An increase in monetary value.
A decrease in monetary value.
An increase in purchasing power.
A downward trend in market prices.
What is the definition of Bad debt?
Debt that does not increase your net worth or help you earn more money.
Debt that increases your net worth by generating wealth.
Debt that is repaid with interest and improves your credit score.
Debt used to purchase assets that appreciate over time.
What is the definition of Budget?
A plan for income and expenses during a set period of time.
A detailed forecast of the economic market.
A record of past spending activities.
A calculation of net profit figures.
What is the definition of Cash advance?
Small amounts of money borrowed from credit card lenders at a very high interest rate.
A service allowing free cash withdrawals without fees.
A short-term loan with no interest charges.
A type of overdraft protection on your checking account.
What is the definition of Compound interest?
A percentage of both the principal (original loan amount) and previously accrued interest that is added to the total amount owed on a loan.
Calculated solely on the initial principal, without considering any interest that accumulates over time.
A method where interest is accrued only once at the end of the loan period based on the simple interest formula.
An interest method where the rate decreases over time as the principal is gradually reduced.
What is the definition of Compounding returns?
When the value of your investment grows based not only on the original amount of money invested, but also on the profits that investment created.
When your investment grows only from the initial principal without any reinvestment of earnings.
When interest earned is not reinvested into the investment, leading only to simple growth.
When additional funds are regularly added to the investment without considering any earned profit.
What is the definition of Credit score?
A numerical value based on analysis of a credit record, describing a person’s likelihood of paying back loans; credit scores range from 300 to 850.
A monthly report of loan repayments.
A fixed rate interest applied to every loan.
A guarantee of loan approval from financial institutions.
What is the definition of Creditworthiness?
The extent to which a person or company is considered suitable to receive a loan, based on their reliability in paying money back in the past.
The process of evaluating a company's profit margins for investment opportunities.
A rating that assesses the maximum amount of loans a company can secure.
A measure of how much collateral a borrower must offer when taking a loan.
What is the definition of Debt?
Money that is owed in return for a loan or a purchase.
Money that is earned from investments.
An asset that increases in value over time.
Funds obtained through a government grant.
What is the definition of Dividends?
Money that is paid quarterly to shareholders of a company from the profits the company earns.
Payments made as bonuses to employees.
Fees currently charged for account management.
Rewards given to management based on performance.
What is the definition of Dollar cost averaging?
An investment strategy that divides up the amount of money being invested and purchases small quantities of assets over time.
An investment strategy that invests the entire amount in a single purchase.
A market timing strategy aiming to buy low and sell high with precision.
An investment method that relies on speculative trading based on daily market fluctuations.
What is the definition of Down payment?
The initial payment at the point of purchase of a large item like a car or house; a bigger down payment can reduce the amount you must pay monthly.
A small deposit typically required for renting electronic devices.
A fee paid after purchase to secure additional services.
An extra charge applied for late payments.
Fill in the blank: A ________ is a loan for a house where the interest rate stays the same throughout the entire term of the loan.
Fixed-rate mortgage
Variable-rate mortgage
Adjustable-rate mortgage
Interest-only mortgage
Fill in the blank: ________ is money expended that can increase your net worth and help you earn more money.
Good debt
Bad debt
Expense cost
Non-investment expense
Fill in the blank: ________ is all of the money that an individual receives or earns in a set period of time.
Income
Savings
Expenses
Budget
Fill in the blank: ________ is money paid at a regular rate in exchange for money lent.
Interest
Fee
Dividend
Commission
Fill in the blank: ________ is money that is expended with the expectation of earning profit in return.
Investment
Expenditure
Expense
Revenue
Fill in the blank: An ________ is a retirement account with tax advantages where money can be saved and invested in for the long term.
IRA
401(k)
Roth IRA
Keogh plan
Fill in the blank: ________ are the things you would like to be able to do with your money more than five years in the future.
Long-term financial goals
Short-term savings plans
Immediate spending goals
Mid-term investment ideas
Fill in the blank: ________ are the things you would like to be able to do with your money in around one to five years.
Mid-term financial goals
Short-term desires
Long-term aspirations
Immediate needs
Fill in the blank: ________ is the total amount of money held by an individual or company, including both assets and debts.
Net worth
Gross income
Total assets
Net profit
Fill in the blank: ________ is tax paid to the Internal Revenue Service based on income from employment or business activity.
Ordinary income tax
Sales tax
Property tax
Capital gains tax
Fill in the blank: A ________ is the pay for work completed in a set period of time.
paycheck
salary
commission
wage
Fill in the blank: A ________ is a small loan with a very high interest rate lent with the expectation that the borrower will repay the full amount of the loan with their next paycheck.
Payday loan
Student loan
Mortgage
Personal loan
A ________ is a tax-advantaged retirement plan with an employer contribution.
Pension
Savings plan
Fixed deposit
Credit union account
Fill in the blank: ________ is the original amount of money lent in a loan that does not include interest.
Principal
Interest
Collateral
Amortization
Fill in the blank: A ________ is an individual retirement account where you can make after-tax contributions; withdrawals made after age 59 ½ are tax and penalty free.
Roth IRA
Traditional IRA
SEP IRA
SIMPLE IRA
Fill in the blank: ________ are the things you would like to be able to do with your money in less than a year.
Short-term financial goals
Long-term financial goals
Planned annual savings
Emergency reserves
Fill in the blank: A ________ is the monetary fees given to an individual if they perform an early withdrawal from a locked or time-specific account, such as a 401(k), 403(b), or IRA account.
withdrawal penalty
liquidation fee
withdrawal fee
early withdrawal tax
What is the first step in making a budget?
Listing expenses
Spending your money
Asking for more money
Adding up all income
If your total expenses are more than your income, you have two options:
Decrease your income & increase your expenses
Decrease your expenses
and your income
Increase your income / decrease your expenses
Increase your income or increase your expenses
Once your budget is complete, you are not finished yet.
The next step is to (a)
All expenses are not created equal. Explain different types of expenses and how to prioritize them in your budget:
How comfortable are you making a budget on your own and sticking with it?
Extremely confident
A bit more confident than before
I will need help to make it happen, but it's possible
No confidence whatsoever
Can something be both a need and a want?
Yes, there are examples of both
No, you can either want or need you can do both
An item that is necessary for life
Value
Want
Need
Well-Being
Something that is
unnecessary to life, but desired.
Value
Want
Need
Well-Being
Which option is a Need?
Car
Cell Phone
Air pods
Shoes
What is an example of Wants
Food
Cell Phone
Water
Shelter
Where are Americans spending more money?
Groceries
Restaurants
The original amount of money loaned / invested is called the (a) .
You have $10,000 in your checking account. You decide to open a savings account at the same bank, and they offer you a 3% annual interest rate. Let's say you opened the account with $8,000 and didn't touch it after that. How much money will you earn from interest after a year?
300
240
120
2400
When is interest a bad thing for you and when is interest a good thing?
When you graduate high school, your strange but wealthy uncle gives you $3,000. You decide to invest that money. If you do not add any money to that account and just let the $3,000 accrue (grow) interest, how much money would you have after 5 years with a 5% annual return?
$2,527.36
$3,245.45
$4,029.76
