Midterm Exam Personal FInance

He should file this fall regardless of what he decides; that way he has an opportunity for financial aid just in case

Marcellus is going into his senior year, and he's not sure whether he intends to start college the fall after graduation or take a year off first. How should he approach the FAFSA this school year?

School B

School A has sticker price of $52,000 and an average net price of $6,000 for families with income of less than $60,000. Meanwhile, School B has sticker price of $22,000 and an average net price of $11,000 for families with income of less than $60,000. If your number one factor in selecting a school was cost and your family income was under $60,000, which school would you choose?

Credit card payments typically vary from month to month, whereas loan payments typically remain the same (as long as interest rates remain constant)

Which represents the most accurate description of how credit cards differ from loans?

The average overdraft fee is $25 or more

Which statement about overdraft protection is true?

It's financially better to pay for college using scholarships and grants than it is to use loans

Which statement about student loans is TRUE?

A traditional savings account keeps your money safe and allows you to add to the balance regularly. A CD requires a fixed deposit amount for a fixed period of time.

Which statement accurately describes the difference between a traditional savings account and a certificate of deposit?

Does the bank you're considering also have an investments division that can help you compound your money quickly?

You've just turned 16 and obtained your first part-time job. You want to open a checking account as well as a savings account. Which of these questions is LEAST important to ask?

Slightly more than $520

Your wealthy grandma gives you a $500 check for your middle school graduation, and you deposit it into your savings account which earns 1% compounding interest. You keep it there for 4 years until you're heading off to college and want to buy some dorm supplies. How much money do you have available? You can ignore inflation and assume no bank fees during this time.

Choose the repayment plan that has the largest monthly payment she can realistically afford while also minimizing her interest payments

Fatima is looking forward to college graduation in the spring but knows she'll need to start thinking about how to pay her student loans. Which is the best approach for Fatima?

Most banks waive all fees for customers who use mobile banking

Choose the BEST answer: Which of these represents a major convenience of using a mobile banking app?

Write a check for your purchase

Which of the following is a method of spending the money in your checking account?

Read the fine print for each credit card before making a final choice

Caleb is trying to select his first credit card, and he's got it narrowed down to two options he thinks would work really well for his circumstances. What should his final step be before making a choice between the two?

The same size payment each month

If your auto loan is amortized over 5 years, you will pay ______.

He is eligible to take a paid work-study job while he attends college, with the expectation that he will use his earnings toward college-related costs

Igor receives his Financial Aid Award Letter and notices Federal Work-study in the amount of $2000. What does this mean?

Scholarships & grants, work study, federal student loans, private student loans

In which order do you want to apply for and accept aid to pay for college?

His gross pay is $3,000 and net pay is $2,500

Isaiah works at a technology company in the summer and earns $3000. After federal, state, and Social Security/Medicare taxes are deducted, his take-home pay is $2,500. Which of the statements below is CORRECT?

Determine how much she needs to save from every paycheck to afford the laptop and the emergency fund, and then auto-deposit that amount into a savings account so she can't spend it

Marcia works a part-time job during her junior and senior years of high school. Although her main goal is to save enough for a really nice laptop, she'd also like to build up an emergency fund. She wants to have at least $500 to take with her in case she needs it during college. Which saving strategy is most likely to help Marcia meet her goal?

Ryan is buying too many material things or spending too much on experiences so that he feels on par with his peers

Ryan has a major problem of overspending from each of his paychecks, even though his ultimate goal is to be saving money for college. His friend Sydney says Ryan's problem is that he's too worried about "keeping up with the Joneses." What does Sydney mean by this?

File your annual income tax return.

The purpose of a 1040 form is to...

A debit card purchase for concert tickets you bought online

Which of these would represent a withdrawal you could see on your monthly checking account statement?

Paying off your entire balance every month by the due date

Which one of the following strategies will result in your paying NO interest to the credit card company?

It tells your employer how much to withhold from each paycheck to contribute toward your taxes

Which provides the BEST description of what a W-4 tax form is used for?

Choose clever and secure usernames and passwords, and keep them secret

When using online and mobile banking, which of these is a smart tip to keep your account safe?

Health insurance premium

Which deduction is LEAST likely to be taken out of a high school student's paycheck from his part-time job at a department store? Assume he lives in a state that collects income tax.

The total amount of deposits you made during that month

Which item would you expect to find on your monthly bank statement?