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deb shelton test
1-13-15 economics test
| Question | Answer |
|---|---|
| saving money for a purchase and letting the interest work for you rather than against you | sinking fund |
| money is neither good nor bad | amoral |
| Emergency Fund goes here | money market |
| Interest on interest | compound interest |
| If it can go wrong, it will; unexpected events | Murphy's Law |
| Baby Step 1 | $500/$1,000 in an emergency fund |
| Baby Step 3 | 3-6 months of expenses |
| key to wealth building | discipline |
| For most people, a fully-funded emergency fund will be about: | $10,000-$15,000 |
| Ben and Arthur illustrate which principle of saving? | compound interest |
| Baby Step 1 and 3 have to do with: | saving and the emergency fund |
| You should save for the following: | emergency funds, purchases, and wealth building |
| How many Baby Steps are there? | 7 |
| Saving is about contentment and ? | emotion |
| The following is true about PACs | Stands for Pre-Authorized Checking, and helps build discipline when saving |
| True or False: The saving habits of Ben and Arthur help to illustrate the principle of compound interest. | True |
| True or False: Dave's 80/20 rule says when it comes to money, 80% is head knowledge and 20% is behavior. | False |
| True or False: Your income level greatly affects your savings habits. | False |
| True of False: Interest is money paid to a saver by a financial institution. | True |
| True or False: The correct order for using your money is save, pay bills, then give | True |
| Why do you think the United States has a negative savings rate? how does this relate to your personal savings habits? | easy credit. advertising and marketing |
| Explain the relationship between having an emergency fund and Murphy's Law? | Murphy won't see you if you have an emergency fund |
| Going to have to calculate compound interest for each problem | |
| What are the 3 primary savings goals? | 1. save for purchases 2. emergency funds 3. wealth building |
| Why do you need an emergency fund at your age? | at our age we have emergencies |
| Why do you need to have $1,000 in the bank before paying off debt? | In case anything happens |
| How does compound interest differ from simple interest? | compound interest is interest on interest |
| What was the most important piece of information or concept you learned from this lesson? How will you apply it to your life? | to save, don't get into debt |
| Go over case studies | |
| Know the Baby Steps | 1. $1,000 in emergency fund 2. Pay off all debt 3. 3-6 months of expenses in savings 4. Invest 15% household income into both IRA's and pre-tax retirement 5. college funding 6. pay off home 7. build wealth |
| What must become a priority? | Saving |
| Always pay who first? | yourself |
| The US has a _______ savings rate. | -0.6% |
| What do you always need to count on something happening? | emergencies |
| your emergency fund is not an _______, it is insurance. | investment |
| Do not ______ this fund for purchases. | touch |
| What percent of all consumers live paycheck to paycheck? | 70% |
Created by:
a.allsup
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