pf exam

For students under 18, a fully funded emergency fund should be what?

$500

a savings account sold by an insurance company designed to provide payments to the holder at specified intervals usually after retirement

Annuity

Renters insurance is required for all renters

false

Teens have cited "friends" as the strongest influence over their purchase decisions.

true

The academic and financial choices you make in the next few years will affect the next 40 years of your life.

true

The average millionaire reads one nonfiction book a month.

true

The envelope system works great for managing spending on things that don't normally have a fixed monthly expense

true

The number one cause of divorce is North America today is stress and disagreements over money.

true

There are 3 credit bureaus: experian, transunion, and equifax

true

Those that succeed at the career of financial planning are usually very skilled communicators who care about helping people

true

Tips at work should be counted as income when you are doing your taxes. They are considered to be "earned" income.

true

True financial security is achieved when your money begins to generate an income-your money starts working for you.

true

Using cash can give you more barganing power than using credit

true

When money is taken out of a 401(k), 403(b) or a Traditional IRA account in retirement it is taxes as ordinary income

true

When you're older and out of school, you'll need to grow your emergency fund into a full three to six months' worth of expenses.

true

You can and should obtain a free copy of our credit report annually in order to check for suspicious activity

true

You must have earned income to contribute to a roth IRA account

true

budgeting is crucial to your financial success

true

A program in higher education that allows student to work part time while continuing their studies

work study

what are some signs that your identity may have been stolen

you're alerted to a credit card charge you didn't make. ... Your loan or credit card application was denied. ... There's a change to your credit score. ... There's a new account you didn't open under your name. ... Your information was part of a data breach. ANSWER ON TEST (ALL OF THE ABOVE)

Savings accounts and money market accounts are most appropriate for...

Emergency funds and short-term goals

The knowledge and skill set necessary to be an informed consumer and manage finances effectively

Financial Literacy.

Which of the following statements best explains why income alone does not determine wealth

How much money a person makes does not dictate his or her spending and saving behavior

Car repairs are an...

Intermittent expense

what is NOT a benefit of understanding your own money personality

Knowing your money personality allows you to excuse excessive spending

quality of an asset that permits it to be converted quickly into cash without loss of value

Liquidity

To ensure that some of your retirement savings will not be subjected to income tax upon withdrawal, you should contribute to...

Roth IRA

Which of the following steps is the first foundation

Save $500 for an emergency fund

What best summarizes how the use of a credit card for purchases instead of cash can change ones spending behavior

Studies show that consumers typically spend mroe when using credit as opposed to cash purchases

The five steps to financial success

The Five Foundations

The zero based budget is the best method of budgeting because...

The Zero-based budget ensures that every dollar you make is assigned a specific purpose.

In the state of WI, you can re-register your UGMA/UTMA account at the age of 21 without your parents permission

True

a detailed report of an individual's credit history

a credit report

Brad has a piece of paper that guarantees the conditions under which he can return, replace, or repair an item that he has purchased. What is this...

a warranty

what account records would have the most current balance

account balance statement from the ATM typically reflects the most up-to-date balance

A written budget, if written and followed, removed the following from your finances...

all of the above

You should visit your colleges financial aid office if...

all of the above

Key components of financial planning do NOT include what

allow your financial planner to make all of your major money decisions

A yearly fee thats charged by the credit card company for the convenience of the credit cars

annual fee

Which of the following is not a good option when it comes to paying for your education

ask your parents to take out a loan

The next door neighbor twins, Johnny and Tommy, are playing hockey in their driveway. Johnny sends a slapshot past Tommys head and the puck goes through your cars window. What type of insurance is used for this claim

comprehensive

Which of the following is not needed

dining out

Americans typically maintain a very high savings rate.

false

Co-signing a loan is a good way to help a friend or relative.

false

Contributions can be taken out of a Roth IRA account at any age without penalty or taxes due

false

Everyone should have the same financial plan. A budget that works for one person should be sufficient for everyone.

false

Good investment portfolios are extremely complex

false

Having more than one bank account is never a good idea since it can complicate money management.

false

If you get into financial trouble, borrowing against your retirement plan is a good option.

false

If you take money out of your traditional IRA before age 65, there is a 10% penalty and the withdrawal is taxable

false

If you were to get married on January 1, 2024, you should be eligible for a married status for the tax year 2023

false

If you write a zero-based budget every month, it is not necessary to reconcile your account.

false

In the state of Wisconsin, you can re-register your UGMA/UTMA account at 18 without your parents permission

false

Inflation has no effect on your buying power.

false

Money in a UGMA/UTMA account is owned by the custodian until the minor is age 21 in WI

false

Most Americans today are wealthy and will have financial security when they retire

false

Once you declare a major, you must commit to that major for your entire college career

false

Prior to the FCRA, consumers were unable to challenge errors in their credit reports

false

Roth IRA accounts are never appropriate for individuals in their 20s

false

Savings accounts usually have a high interest rate compared to other financial products

false

Single stocks and mutual funds carry the same amount of risk.

false

Students rarely drop out of college due to financial trouble

false

The best quality colleges are always the most expensive.

false

The first thing you should save for is your retirement fund according to Dave Ramsey

false

Under the Fair Credit Reporting Act (FCRA), individuals are rejected for insurance due to information contained in a consumer report.

false

When it comes to saving money, the amount you save is determined by how much you have left at the end of the month once all of you spending is done

false

You must be at least 10 years old to have a UGMA/UTMA account

false

You must go to a prestigious school in order for employers to recognize your talents and strengths.

false

You should keep your emergency fund in the same account as your spending money.

false

You'll only need to complete the FAFSA once during your college education.

false

a four-year degree is necessary regardless of which career your entering

false

expensive houses and new cars are a true indication of wealth

false

there is no limit to how much money can be saved in a Roth IRA

false

who you are in a relationship with someday is not a major factor in your success with money

false

Rent is a

fixed expense

A long term rental agreement on a car; a form of secured long term debt

lease

what concept is best explained by the statement ʺmoney spent here cannot be spent thereʺ

opportunity cost

what is NOT recommended in the debt snowball method

paying higher interest accounts off first

A listing of your investments

portfolio

the benefit of diversification in your investments is

reduced risk

A form of financial aid that does not need to be repaid; usually awarded on the basis of academic, athletic, or other achievements

scholarship

Securities that represent part ownership or equity in a corporation

stocks

"pay yourself first" means you should assign a portion of your income to savings and investing every months

true

Being married (or emotionally attached) to a purchase will cause you to lose bargaining power.

true

From Dave Ramsey's point of view, it is very difficult to become successful if you don't make a commitment to give.

true

If you leave a job and have money saved in your employer's retirement plan, always roll that money into an IRA using a direct rollover, which allows you to avoid taxes and penalties.

true

If you plan to attend a community college for your first two years, youʹll want to work closely with your advisor to make sure that the classes you take will transfer to your four-year school of choice.

true

Learning to be quiet is actually a powerful tool in negotiation.

true

Making informed choices as a consumer will usually yield savings.

true

Money in a traditional IRA must begin to be taken out when you are 73. This is called a "required minimum distribution"

true

Money markets are great for your emergency fund due to their liquidity and stability.

true

Never buy something you do not fully understand.

true

Our culture thinks student loan debt is normal and that itʹs an acceptable way to pay for college.

true

Setting up automatic account transfers is the easiest way to build your savings for your emergency fund or large purchases.

true

Shopping for bargains is part of a healthy financial plan because it makes your hard -earned money go further.

true

You must shop for the best price for your education in the same way you comparison shop for any large purchase.

true

Zero percent financing is nothing more than a really good marketing tool

true

having debt keeps you from building wealth

true

if you leave a company after 1 year and your company has a 5 year vesting schedule, you'll be able to take 20% of the company match with you.

true

you may have limitations to what you can invest in when investing in a company sponsored 401k plan.

true