1.
Which of the following is NOT a reason to save/invest?
A.
Provides a more “comfortable” lifestyle
B.
C.
Achieve long term goals & purchases
D.
For a comfortable retirement as Social Security may not be around much longer
E.
All of the above are reasons to save/invest
2.
Which of the following is NOT one of the rules of saving & investing?
A.
Determine your financial goals
B.
Keep all of your retirement funds in a local bank's savings account
C.
D.
3.
Savings accounts are a very safe place to put your money as they are FDIC insured (US Government backed).
4.
Savings accounts usually earn a very high interest rate. (10-15%).
5.
Which of the following is true about a Certificate of Deposit (CD)?
A.
You can pull your money out at any time without any penalty.
B.
A 6 month $1,000 CD will pay more interest than a 1 year $2,500 CD
C.
A CD pays about the same interest rate as a savings account.
D.
The longer the term and the higher the amount of money you promise to keep there, the higher interest rate you will earn.
6.
If you withdraw your money out of a Certificate of Deposit (CD) before the maturity date you will have to pay a penalty fee.
7.
A ROTH IRA uses after tax money from your paycheck to invest but when you pull out the money when you retire, you don't have to pay taxes on it.
8.
A traditional IRA uses pre-tax (untaxed) money from your paycheck to invest but when you have to pay taxes on all of the money that you pull out during your retirement.
9.
The ___________________ the risk of an investment, the higher the return will be.
10.
The lower the risk of an investment, the __________________ the return will be.
11.
Instructions: To gain a better understanding of the fundamentals of savings and investing, use the resources at www.themint.org (Click on the “Tips for Teens” menu and then click “Try It”) then select the
"Savings Calculator" to complete the following:
You have recently set up a financial goal of purchasing your own car once you have graduate high
school (1 year and 3 months from now). After shopping around, you found a great used car for $6,000. Currently, you have saved up $500 towards this goal. How much would you need to save per month if you placed your money into a
Savings Account: ________________
12.
Using the same scenerio above, How much would you need to save per month if you placed your money into a
Certificate of Deposit: ________________
13.
Instructions: To gain a better understanding of the fundamentals of savings and investing, use the resources at www.themint.org (Click on the “Tips for Teens” menu and then click “Try It”) then select the
"The Compounding Calculator" to complete the following:
Assuming you are 17 years old, if you were to invest $50.00 each month into a SAVINGS ACCOUNT (with compounding interest) how much money could you have by the time you are 65 (48 years)?
14.
Assuming you are 17 years old, if you were to invest $50.00 each month into a CERTIFICATE OF DEPOSIT (with compounding interest) how much money could you have by the time you are 65 (48 years)?
15.
Assuming you are 17 years old, if you were to invest $50.00 each month into a MUTUAL FUND (with compounding interest) how much money could you have by the time you are 65 (48 years)?
16.
Assuming you are 17 years old, if you were to invest $50.00 each month into STOCK MARKET how much money could you have by the time you are 65 (48 years)?
17.
Rule of 72
If you invest $50,000, how many years will it take for it to grow to $100,000 if you can earn 4% annual interest?
18.
Rule of 72
If you invest $50,000, how many years will it take for it to grow to $100,000 if you can earn 6% annual interest?
19.
Rule of 72
If you invest $50,000, how many years will it take for it to grow to $100,000 if you can earn 9% annual interest?