PF Exam
Improper tax preparation is another sign of bad money management. Receiving a large lump sum of money at the end of tax season is allowing the government to borrow your money interest free. Instead of a $1,000 refund at the end of tax season, what would the ending value of that money be if you could have invested it in a money market account gaining 6% growth for one year?
$1,060.00
You need $12,000 at the end of 5 years to use as a down payment on a beachfront lot in Hatteras, NC. You found a Vanguard Money Market account that pays 10% compounded annually. How much do you need to deposit each year to reach your goal?
$1,965.60
Suppose that I am trying to borrow money from you to finance my business. And suppose that I promise to repay you in two installments, one payment in two years of $5,000 and one payment in four years for $10,000. If your opportunity cost of funds is 10%, how much are you willing to lend me?
$10,962
Assume you land a great job after graduation and you are talking to your boss. He is 35 years old and has a one-time amount of $5,000 to invest for his retirement when he turns 68 years old. If he invests in stocks, which have a lot of price volatility each year, it may be up one year by 25%, or down by 15% another, but averages 10% per year over the next 33 years. How much will he have?
$116,125.77
Let's assume after looking at your budget you determine you can afford as much as $300 per month for your car. After doing your research you found out that the local credit union will let you get a car loan for as low as 5%. You determine, based on your goals, that you would like the car to be paid off in four years or less. With this information how much car can you afford?
$13,026.89
Robert stuffed all of his savings dollars into his mattress 15 years ago. He put $8,500 into his bedding because he did not trust any savings or investment accounts. Average inflation for the past 15 years was 3.25%. How much money does Robert need in his mattress today to have the same purchasing power that he had 15 years ago?
$13,733.00
If you deposit $1,000 each year, starting the end of first year, in an account that pays 10% interest per year, compounded annually, what will be the balance in the account after you have made ten payments, assuming you make no withdrawals from the account?
$15,937
You marry at 20 after finding true love. Being extremely proactive, you're already planning for retirement. You think it would be nice for you and your spouse to each have amassed a million dollars once you retire. In your budget, you've made room for you and your spouse to both contribute $300 each to a retirement account gaining 8% annual growth. How much will you have when you turn 60 years old?
$2,094,604.70
If I deposit $200 in an account that pays 5% interest, compounded annually, what will be the balance in the account at the end of ten years if I make no withdrawals?
$325.78
You wisely decided to invest some extra money each month into an index mutual fund. You found one that averages a return of 8.6%. You can deposit an extra $200 each month by setting up an automatic draft. How much can you expect to see in 10 years in your account?
$37,839.74
You just started your job with a company offering a 401k with an average return of 6%. You are 20 now and always had aspirations to retire early at 50. If you can contribute $500 to your account each month, how much will you have at age 50?
$502,257.52
What is the present value of $800 received at the end of year six, assuming a 7% interest rate?
$533.07
After purchasing 100,000 lottery tickets at $2 a piece you finally won. $1.5M is coming your way. Including what you spent on lottery tickets and the 40% lottery tax, how much will you actually be putting (profiting) in your pocket?
$700,000.00
If I invest $100 today in an account that earns 10% per year, compounded semi-annually, how much will I have in this account at the end of twenty years if I make no withdrawals?
$704
You wanted to avoid the PMI on a mortgage so you decide to take out a loan to cover approximately 20% of a $175,000 home. If you are approved for the new mortgage of $140,000 at a rate of 4.5% and 30 years, what is your new mortgage payment?
$709.36
What is the future value of $500 deposited today at 10% for 5 years?
$805.50
Your 25-year old younger sister started smoking. She is currently paying $24.00 per carton per week. You explain to her that this is $1,248 per year ($24 x 52). She says big deal. You then tell her that if she were to save that same amount and invest it in the stock market, she would have a significant amount of money to retire when she turns 65. Your sister wants to know how much she would have. You know that over the long-term, the stock market has returned 12% interest compounded annually. You tell your sister that if she stops smoking she will have_________ when she retires.
$957,328
Assume a person smokes three packs per week and their cigarettes cost $8 per pack which totals to $35 a month. If this person quit smoking at age 25 and invested that money instead, they could have an additional $500,000 in their retirement account at age 65 assuming what annual interest rate?
0.1261
Out of the three tax forms you should concern yourself with, this is for those with a slightly more complicated tax situation.
1040-A
To find the total number of compounding periods, you multiply the number of years by the number of compounding periods. If it is monthly, multiply by what?
12
Although you may not buy new clothes every month, you will spend money on clothes sometime during the year. At the very least, include an entry for clothing a few times on your ________ budget.
12-month
On average cars depreciate or lose about what percent of their value each year?
20%
In 1950, Jack-in-the-Box hamburger cost $0.24. In 1994, a Jack-in-the-Box hamburger cost $2.79. What is the effective annual increase in the price of a Jack-in-the-Box hamburger from 1950 to 1994?
5.73%
The Milken Company is offering you an investment that promises you $1,000 at the end of ten years if you invest $500 today. What is the annual return on this investment?
7.18%
When purchasing a car, which of the following are negotiable?
A, B, and C are correct
The five Cs of credit take into account your what to replay a loan?
Ability to repay your loans
This term describes a supervised setting outside the home to provide social and other support during the day for adults with some type of chronic illness or disability.
Adult Day Care Services
A 1% increase on the interest rate of a $25,000 car loan for five years would be the same as:
All of the above are correct
Which of the following people are vested in a person buying the most expensive car they can:
All of the above are correct
A great way to save on purchases is to __________.
All of the answers are correct
To avoid spending more than necessary, while maintaining safety with paper checks, you should do what?
All of the answers are correct
To protect children from financial failure parents should do what?
All of the answers are correct
While the financial services industry has made investing a very complicated process, it should be very __________.
All of the answers are correct
To perform a self-assessment as an employee people should do what?
All of the answers are correct Outline any shortcomings that are critical to getting that next job Honestly and critically evaluate themselves Ask some fact-based questions about themselves Objectively identify what real strengths they have
What cost do many students and parents worry the most about?
All the answers are correct
How many people can do their job and go home?
Anybody
Everything related to federal taxes in one way or another goes through the IRS. They are a powerful agency, since they have the power to shut down businesses that owe taxes, take a taxpayer to court for fraud or failure to pay taxes owed, and what additional power?
Audit any individual or busines
What is a good strategy to make sure you make all your monthly bill payments on time?
Automatic direct draft
One pitfall to financial planning is there are 1.2 million of these every year and they have huge financial consequences for a long time.
Bankruptcies
Who or what only spends money on things that make it money or adds value?
Business
Taxes on property are what?
Can be a recurring tax, paid year after year on property someone owns
What is the tax that is levied on gains made from the sale of an investment asset such as stocks or real estate?
Capital Gains Tax
It is important to be prepared for your next job. This is part of what kind of plan?
Career
This is a lifetime occupation or profession, especially with advancement opportunity. It usually requires periodic educational training.
Career
As one of the top-visited job search sites in the United States, this website has millions of visitors each month. It powers the career sites of more than 1,000 partners, including 340 newspapers.
CareerBuilder.com
What is a form of savings that gives the bank the right to your funds for a specified period of time because you give up access for this specified period of time for a higher interest rate?
Certificates of Deposit (CD)
The five C's of credit are what?
Character, capital, conditions, capacity, collateral
Charles has used the same credit card from State Bank credit card company for over 10 years. He has always made his payment on time until last month when his hamster escaped from its cage and ate the credit card statement before Charles had a chance to see it. Charles made his payment, but it was after the due date. State Bank credit card company subsequently raised the interest rate from 7.9% to 29.9% as penalty for the late payment. Which of the following should Charles do?
Charles should remember that he is the consumer which makes him the boss. He should call State Bank credit card company and demand it reduce the interest rate back to 7.9%. If it will not, Charles should shop around and transfer the balance to a new card with a lower interest rate
Charles has saved $6,500 for his emergency fund. His banker suggested that Charles use a money market account, but Charles wants to put the money in a CD (certificate of deposit) because it pays a quarter percent more in interest. What should Charles do?
Charles should use the money market account as it provides him immediate access to his funds
As part of the budgeting process one should:
Compare estimated expenses with actual expenses
The steps to resolution of product defects or poor service include filing a lawsuit, report to a consumer protection agency, utilize mediation or arbitration, and what?
Contacting the company
This is the term for the person who would collect your insurance proceeds if you die and your beneficiary dies.
Contingent Beneficiary
In order to pay less in taxes, you need to either earn less or maximize the use of credits and deductions. Follow these steps to reduce the amount of taxes you owe: maximize your contributions to your 401(k), review all possible credits for which you may apply, maximize contributions to a qualified health savings account, deduct moving expense, deduct student loan interest, deduct tuition or claim an eligible education tax credit, and what final step?
Contribute funds to a traditional IRA
What lets you smooth out all the ups and downs of your investments, and thus lowers your risk?
Diversification
It is not going to be good enough to just graduate, even with a high GPA, if you want any chance at all of getting your what after graduation?
Dream Job
You will find that you do not possess all the necessary skills and experiences required for your future what? Do not panic. Discovery is all part of the process. Remember, you are still in college and now is the time to acquire those skills.
Dream job
This credit is a non-refundable tax credit for the purchase of a qualified electric vehicle.
Electric Vehicle Credit
What type of decisions can negatively impact the outcome of the car buying process?
Emotional & ego-driven
Lifestyle force identifying you and/or other family members as employed, unemployed, facing unemployment, or currently under-employed.
Employment Status
Your three credit scores include the Transunion FICO score, the Experian FICO score, and what other FICO score?
Equifax
Unlike the estate tax, which is a one-time transfer tax, what tax is an ongoing tax based on the income generated by the investments inside of the trust?
Estate and Trust Income Tax
Although other companies now have their own proprietary credit scores, what is still the most commonly used credit reporting
FICO
Although other companies now have their own proprietary credit scores, what is still the most commonly used credit reporting service?
FICO
Other than telephone conversations, what is the best way to get to know people?
Face-to-face
A career elevator speech is a 20-30 minute summary of who someone is and what they are looking to do.
False
A good cover letter should be at least three pages long.
False
Although the cover letter is the tool that helps secure an interview, a well written resume provides the incentive for a potential employer to read the cover letter.
False
This term describes the duty and responsibility to manage another person's money and assets in a responsible and ethical way.
Fiduciary
The three primary financial phases individuals transition throughout their lifetime are referred to as what?
Financial Life Cycle
Contrary to popular belief, what is the true purpose of your resume?
Get the Interview
If you choose a job that incorporates many of the things you like to do, chances are, you will be very ____ at your job.
Good
This term is the person designated by the testator to care for minor children or pets.
Guardian
What is the term for a will that is handwritten and signed by the testator?
Holographic Will
What is insurance that covers a private resident or home?
Homeowner's insurance
What agency is part of the FBI and is charged with receiving reports of, and dealing with, cybercrimes including online fraud?
Internet Crime Complaint Center
You can use LinkedIn to reach out to that company, research and uncover the contact information for the hiring manager, and discover the needs of the company. For what will this information be useful?
Interview
This is the process of setting aside money that is intended to achieve a long-term financial goal. The money is placed in a financial instrument that is expected to gain value over long periods of time.
Investing
Ira is being considered for a promotion from Assistant Director to Director of the Center for Personal Financial Research at Big State University (BSU). He and RuAnn are the final two candidates for the position being interviewed by the selection committee. RuAnn has more experience in personal financial research than Ira and appears to be the stronger candidate. What must Ira do in his interview with the selection committee to get the promotion?
Ira must convince the selection committee that he brings greater value than RuAnn to the position
The toilet is leaking in Ira's bathroom. Although he knows it would take him less than two hours to fix the leak, it will be a less than pleasant job. In addition, he will need to take a total of three hours off from his $25 an hour job to stop by the home repair store to pick up a $3 seal. His alternative is to call a plumber and pay $136 to replace the leaking seal. Financially speaking, what should Ira do?
Ira should repair the toilet himself
An automobile insurance policy written as 30/60/25 means what?
It provides $30,000 maximum payout to any one person for bodily injury from an accident
A successful graduate from your college is more likely to make a positive impression on the workforce, leading to more these for future graduates from your school.
Job Opportunities
This term describes when two or more people own a piece of property.
Joint Ownership of Real Estate
When financially planning for taxes, one's primary goal should be to what?
Legally minimize their tax liability
Many people focus on their resume and cover letter; but what is also important to create or update?
LinkedIn Profile
What is the term for an insurance coverage that provides for nursing home, in-home care, and personal or adult day care services for individuals, usually above the age of 65, with chronic illness or disability?
Long-term Care Insurance
Every employer expects you to have the standard equipment to do your job. In order to stand out to your employer, what must you bring and start crafting yourself to be in order to add value and stand out?
Luxury edition
What it the amount of money the manufacturer recommends the car be sold for by the retailer (dealer)?
MRSP
When you go grocery and clothes shopping, what should you do to ensure you leave with only what you intended to purchase and nothing else?
Make a list and check it twice
During this type of warranty coverage, the owner can take the vehicle to any authorized dealer service center and have repairs made without cost.
Manufacturer warranty
What is the amount for which the vehicle can be sold to another individual?
Market value
When it comes to taxes, the five filing statuses identified by the IRS are single, head household, qualifying widow(er) with dependent child, married filing separately, and what final filing status?
Married Filing Jointly
In order to pay less in taxes, you need to either earn less or maximize the use of credits and deductions. Follow these steps to reduce the amount of taxes you owe: maximize your contributions to your 401(k), contribute funds to a traditional IRA, review all possible credits for which you may apply, deduct moving expense, deduct student loan interest, deduct tuition or claim an eligible education tax credit, and what final step?
Maximize contributions to a qualified health savings account
If you drive more miles than a car lease allows, you pay a penalty for every mile you go over. What should you consider before leasing a vehicle?
Mileage Restrictions
What do some institutions require in your account to avoid monthly service fees?
Minimum Balance
An employer must make:
More from their employee than what the employee costs them
This organization is a professional association of attorneys committed to improving the quality of legal services to the elderly. While its primary focus is education, it also advocates for public policies that align with its mission.
National Academy of Elder Law Attorneys (NAELA)
It's easy to call your current credit card company to do what?
Negotiate Better Terms
What is the difference between your assets and your liabilities?
Net worth
Now that you know what type of car you can afford, it is time to decide if you should buy what kind of car?
New or used
When it comes to cover letters, how many people want to read a page filled with small font text that is boring and not relevant?
Nobody
__________ a new or used car is just one of many decisions faced in the car buying process.
None of the answers are correct
What is the key to teaching your children to be comfortable with money?
Open and Honest Communication
What are you required to enter when making a purchase to verify your debit card?
PIN
What term provides immediate access to funds to the assigned individual upon showing proof of your death?
Payable-on-Death Accounts
When it comes time to get rid of an old car:
People can get a little more money by selling it themselves
What is the term for a situation where the value gained from acquiring an asset using debt is greater than the cost of borrowing?
Positive Financial Leverage
What is an agreement that a couple can enter into before getting married, with the purpose to designate ownership of certain assets that will not be divided in the event of a divorce?
Prenuptial Agreement
What is the term for a contractual agreement made by a couple before their marriage in regard to ownership of assets should the marriage dissolve?
Prenuptial Agreement
When you become the first person your boss thinks of when he or she has an assignment to be done right and on time, what is more likely to happen?
Promotion
Document displaying a job seeker's education, work experience, credentials and achievements.
R Sum
Before purchasing a vehicle, it's important to do this to make sure that financial history is listed correctly.
Review your credit report
Robert wants to buy his first home. He spent two weeks working with a real estate agent looking at homes in the $150,000 price range and made an offer to purchase a cute three bedroom home on a half-acre lot. Unfortunately, Robert was denied a mortgage from a local bank, a local credit union, and a national mortgage lender. Robert had saved $15,000 for a down payment and is surprise that he cannot obtain a mortgage. In addition to the down payment, he has a balance on his car loan of $18,000, a consolidate student loan balance of $22,000, and a balance on his credit card of $6,000. His car is worth $16,500. What is the most likely reason Robert does not qualify for a mortgage?
Robert does not qualify for a mortgage because he has a negative net worth
Ira and RuAnn graduate from college this year with the same degree. They both are good students, but Ira will graduate at the top of his class. RuAnn was vice president of the student government association, completed a summer study abroad in Germany, and interned with a local pharmaceutical company. Ira focused on his studies for most of his time in college. RuAnn is deciding between two very good job offers while Ira is still interviewing but has no job offer. What is the most likely difference between Ira and RuAnn?
RuAnn focused on answering the "Three W's" while in college while Ira focused on his classroom work only
What is the term for insurance that will financially assist you if you have a disability or injury that prevents you from working for a short amount of time?
Short-term Disability Coverage
Most legally acceptable wills are typewritten (not hand-written), signed by a witness, and what final criteria?
Signed by the person designating their wishes
Applicants with a less than perfect resume are the first to go. Because of this, what do you remove from your resume to stay in contention?
Silly Mistakes
S.M.A.R.T. goals are goals that are what?
Specific, Measurable, Attainable, Relevant, and Time-framed
This term refers to the idea that money is worth more today than the same amount of money in the future. Money today can earn interest or add value until the specified time in the future.
TVM
The goal of estate planning is to practice what by utilizing the available tax laws to minimize your estate tax liability?
Tax Avoidance
Educating consumers about their rights and businesses about their responsibilities is just one responsibility of what agency?
The Federal Trade Commission (FTC)
When a bank approves a customer for a loan:
The customer will have to consult their budget to determine if they are comfortable spending as much as their approval
The more complex the investment:
The more likely it should be avoided
What is a debt utilization ratio?
The ratio of incurred or actual debt to total debt limit.
Before you step onto a car lot, it's important to determine the total cost of ownership for you, including finance charges, insurance, and what?
The real value of the car
This concept states that money is worth more today than the same amount of money in the future. Money today can earn interest or add value until the specified time in the future.
Time Value of Money (TVM)
The thinking is that you will be in a lower tax bracket after you retire. This form of retirement account saves you taxes overall.
Traditional IRA
Almost every employer offers professional development courses or workshops on improving communication skills.q
True
How careers are managed is one of the biggest financial decisions most people make.
True
It is important to take proactive steps to keep a career balanced and in line with personal goals and objectives.
True
It is not substantially important to be prepared for the next job along the way in a good career path plan.
True
Just like a financial plan, a career plan includes setting career goals and objectives and then implementing a plan that gets one to where they want to be.
True
When applying for jobs it is important for people to a have a good idea of what they want to do, because they can look for places that have large concentrations of the kinds of jobs they want to do.
True
College will take a lot of your time and add up to a lot of money. The average _________ and board for a public four-year college is more than $80,000 over four years.
Tuition
Most legally acceptable wills are signed by a witness, signed by the person designating their wishes, and what final criteria?
Typewritten (not hand-written)
What job site is the online portal for the federal government to list civil service (non-military) job openings? Federal agencies use this site to facilitate their hiring process and match qualified candidates to jobs openings.
USAJobs.gov
The steps to resolution of product defects or poor service include contacting the company, report to a consumer protection agency, filing a lawsuit, and what?
Utilize mediation or arbitration
Begin by asking yourself What kind of work do I want to do? Do you prefer inside sales or outside sales? Do you want to be a manager? Do you want customer interaction? Would you like to work in manufacturing? Would you like to work in retail? Do you want to work in the healthcare industry? How about for a software company? These are all questions you should ask when addressing which "W"?
What do you want to do?
When investing, what should you determine first so that you know how much you are willing and able to put towards your investments?
What you can afford
A car is basically:
a box of miles
Although not always the case, what do many utility companies, water cooperatives, and cable companies require from first-time renters or new customers?
a deposit
Your savings account should fit three criteria: an account that makes it easy to get to your cash, an account where you can be sure it will be there when you need it, and what else?
a safe place
Lenders want to make sure borrowers have what to be able to repay their loans?
ability
When budgeting, the third step is to compare your estimated budget with your what?
actual budget
What should you consider when deciding to buy a new or used car, or to buy or to lease a car to determined which option is best for you?
advantages and disadvantages
Understanding the __________ taxes have on purchasing decisions is crucial to reaching personal financial goals in as short a time as possible.
affect
To shop around for the best price on insurance:
all of the above are correct
Couples are likely to overspend, usually by accident, when they do not do this concerning their financial goals and finances.
all of the answers are correct
Once a collection agency proves that a debt is legitimate, it is important to __________ between what is actually owed to the lender and all the fees and payment penalties that were added by the collection agency.
all of the answers are correct
By giving your children this, it will help them learn to live within their financial means.
allowance
Although legal and document services (such as legalzoom.com) help you to prepare your own will by providing a template and some guidance, most wills are drafted by who?
an attorney
In TVM, typically you find the following compounding periods (compounding frequency) per year. What does once per year mean?
annual
Although numerous commercials advertise access to free credit reports or free credit scores, where is the only place to get the reports online for free each year?
annualcreditreport.com
How frequently do tax laws change?
annually
The future value of an __________ calculates how much a regular series of payments will be worth at some point in the future.
annuity
When conducting a time value of money calculation using your calculator, you can enter them in what kind of order?
any
Cars can be sold '__________,' where there is no express or implied warranty.
as-is
What is the term for the collective property you own?
assets
The first step in developing a positive __________ at work is to believe in one's self.
attitude
It's easy to track your checking account ___________. If you like old-school pen and paper, there are many small paper registers that allow you to track when you write a check or make an ATM withdrawal, and when you make a deposit. There are also plenty of apps and online tools that link to your accounts and help track your spending.
balance
This is the legal status granted by a state or federal court when an individual is unable to pay their outstanding debt.
bankruptcy
This term is the person designated to receive the benefits, such as assets, from the will.
beneficiary
Creditors and collection agencies are not allowed to make outrageous threats, call neighbors or family, and cannot harass by telephone or in-person if the __________ sends a certified letter stating such.
borrower
Charles does this with his money when he uses his credit card.
borrows
If you do not have enough money in your account to cover the check, this could potentially happen.
bounced check
At some point most people ask, "Where did my money go?" There are countless ways that money seems to leak out of a __________.
budget
Make sure to include a reasonable amount of money for car maintenance on the __________ sheet when determining how much monthly car payment is affordable.
budget
When purchasing a used car, make sure to include a reasonable amount of money for car maintenance on the __________ sheet when determining how much monthly car payment is affordable.
budget
A __________ is used to determine what can be comfortably afforded.
budget sheet
Although this is a process, it does not have to be a complicated one. What is it?
budgeting
What account it not a good idea to keep all of your money for savings?
checking accounts
What is a tax credit given for each dependent child under 17 years of age at the end of the tax year?
child tax credit
__________ agencies buy past due accounts from lenders for pennies on the dollar.
collection
What is a Co-branded pre-loaded debit card that features the school name and logo and may also function as their student identification card? The card can be used like a prepaid debit card.
college debit cARDS
This kind of card operates just like other prepaid debit cards, but many card companies, and even banks, partner with a college to offer this card.
college debit cards
Although the Internal Revenue Service (IRS) is the federal agency tasked with enforcing the tax code, who is responsible for writing the tax code?
congress
As you start the car buying process, where is it recommend you begin in order to get an unbiased review of the vehicle you are interested in purchasing?
consumer reports
Even with all the dangers that come with using credit cards, there are several advantages that make having a credit card worth considering. What is the biggest advantage?
convenient
Although a resume is the tool that helps secure an interview, a well written __________ provides the incentive for a potential employer to read the resume.
cover letter
What is the term that allows people to buy things now instead of having to wait until they have saved enough cash to pay for them?
credit
_____ is simply an external indicator of how we handle our financial life. It is an attribute or a characteristic about us.
credit
In 2009, which laws changed many of the rules of the credit card industry in an attempt to protect consumers?
credit CARD act
What two entirely different concepts do most people use interchangeably, and therefore, incorrectly?
credit and debit
Information that is gathered for your credit reports comes from credit and banking agencies voluntarily reporting information about you and your ________ to one or more of these agencies.
credit habits
This company offer relatively new services, such as free credit reports and credit scores. Even though they do not require your credit card number, your personal information (including your Social Security number) is sold to third parties who attempt to use this information for marketing and sales purposes.
credit karma
These may come from different credit reporting agencies and may look somewhat different from each other.
credit report
You can equate this as your financial report card or your financial transcript.
credit report
Did you know, employers now use this term to determine if they want to offer you a job? Even landlords use it to decide if they want to lease an apartment to you.
credit score
Most people understand that ________ are important, but they don't necessarily understand how they work - or sometimes life just gets in the way.
credit scores
In order to pay less in taxes, you need to either earn less or maximize the use of what?
credits and deductions
This card uses the same networks as credit cards. You may also find the VISA or MasterCard logo on most of them and you swipe them through the same machine at the store.
debit card
By casually adjusting spending levels slightly lower, __________ can gradually be eliminated.
debt
What should you pay off sooner rather than later, giving you more money at the end of the month to focus on the things that are important to you?
debt
Many banks waive account fees if your paycheck is ________ into your account, so you don't have to wait in line to cash your paycheck. Many employers no longer write checks and instead require this service.
direct deposited
When purchasing that new vehicle, the dealer will work tirelessly to get you to make a decision based on your what instead of what is in your best interest?
ego
This is a fund, or pot of money, you should start while in college. After college, this fund needs to be larger to get you through a period of unemployment or unexpected repairs for your car or house.
emergency fund
What is a small reserve or cushion to get you through the hard times, whether it is an unexpected repair for your car or a very large utility bill one month?
emergency fund
What concept is about properly managing your assets while you are alive and transferring them upon your death?
estate planning
What is a tax levied on the net value of the estate of a deceased person before distribution to the heirs?
estate tax
What is the term for taxes levied on the net value of the estate of a deceased person before distribution to the heirs?
estate taxes
This term describes the periodic advance payments of taxes based on an estimation of expected income and the tax liability on that income.
estimated taxes
This type of will is a non-legally binding document where you pass on wisdom, advice, or stories to future generations.
ethical will
This term is the person designated by the testator to carry out the terms of the will, such as distributing property.
executor
A big disadvantage to renting is that the home requires little maintenance costs from the renter.
false
A resume is an insignificant document as it is how you sell yourself in the interview that really matters.
false
A will is not a necessity for most parents with young children because there are better ways to assign guardianship.
false
Almost no lender looks at anyone applying for a loan based on the risk presented to the lender, they look at them using the five C's of credit.
false
An express warranty is simply one that is inferred.
false
As soon as children high school, they can begin to learn about money.
false
As soon as children start learning to say please and thank you, they can begin to learn about money.
false
Budgeting is a process, but it is always a very complicated one.
false
Charitable donations are not a good way for most people to reduce their estate.
false
Charitable gift funds let parents make a tax deductible donation, but only the child benefits on their taxes.
false
Dinning out less is one of the hardest ways to reduce expenses.
false
Estate planning only needs to be done by wealthy people only.
false
Even though all renters signed the lease, each is only responsible for their share of the rent.
false
FDIC is short for the Federal Deposit Investment Corporation.
false
Financial autonomy is never healthy for a relationship.
false
Fortunately, many marriages never end.
false
Generally, anyone planning to replace their car every five years or less may be better off leasing lower-mileage used cars.
false
Generally, the shorter the length of the certificate of deposit (CD) the more interest is paid.
false
In most cases, the total cost of a new car is less expensive than a used one.
false
In order to lure more customers to using their debit card, many debit card companies offer zero percent interest for a short time such as the first six months.
false
It is more important to get what you want than to get value while spending money.
false
It is not a good idea to be the first person the boss thinks about when they have a critical project as it usually means unpaid overtime.
false
It is not important for taxpayers to understand the difference between tax credits and tax deductions since both reduce your tax liability.
false
Leadership skills are important to only those few employees that employers want to advance in the company.
false
Make sure to include a reasonable amount of money for car maintenance on the net worth sheet when determining how much monthly car payment is affordable.
false
Money market accounts usually earn a little less interest than that paid on typical savings accounts.
false
Most banks charge a small fee for their own customers to use their automated teller machines (ATM).
false
Most experts agree that 15% profit on the sale of a car is fair to both the automobile dealer and the buyer.
false
Most people realize how much they actually spend on each budget expense category.
false
Property insurance coverage pays for damages to a car when it is involved in an accident.
false
Renters build equity on a house lease but not on an apartment lease.
false
Savings accounts do not work well for emergency funds and other very short-term goals.
false
Since all credit cards work the same there is no need to shop around for a credit card.
false
Term life insurance pays off a specific debt, such as a car loan, in the event that the policy holder dies.
false
The future value of a lump sum is used to calculate what a future dollar amount is worth today
false
The future value of an annuity allows easy calculation of what a series of regular payments to be received in the future is worth today.
false
The option of overdraft protection to protect from having payments rejected or bouncing checks due to lack of funds is no longer available.
false
The present value of a lump sum calculation is used to determine what a given amount of money today will be worth at a certain point in the future.
false
The three important things to consider when buying cash value life insurance is a renewability option, restrictions on pay out, and if it is a level term policy.
false
There are always lots of chances to impress a potential employer or hiring manager so the resume is not that important.
false
There are few opportunities to gain valuable leadership experience in most positions within most companies unless you are in management training.
false
There are no reputable online lenders that offer car loans.
false
There is only one basic type of life insurance.
false
Unlike like a financial plan, a career plan does not include setting career goals and objectives.
false
When buying a car it typically is better to make an emotional decision rather than a financial one.
false
When talking about credit scores it is common to hear the term budget.
false
What is the term for charges if it is a transaction between a consumer and a business or if your account is linked to a credit card?
fees
Once you know what standards you are looking for in your investments, you can compare your options and see which ones offer the returns you are seeking based on what?
fees and other charges
We face many risks. Not fully inclusive, the list includes: disability, illness, death, identity theft, property, liability, and what other form of risk?
financial
Along with a full understanding of time value of money, what other simple tool will greatly improve your financial capabilities?
financial calculator
Time value of money concepts equip you to answer or determine what successfully?
financial choices
Learning to communicate about money in any relationship is crucial to your what?
financial health
Regular monthly shortages require you to either borrow money and get further into debt or remove funds from savings to cover the shortfall. Both are detrimental to your long-term what?
financial health
What term is short for financial technology? It is considered disruptive technology, meaning that it significantly changes the way you bank.
fintech
The advantage of this type of mortgage is the security of knowing the amount of your monthly payments will not change.
fixed-rate
When solving for how much some amount today is worth tomorrow in a time value of money problem, you are solving for what value?
future
Good financial __________ are S.M.A.R.T. goals.
goals
Setting these are the first step to achieving personal financial success
goals
What is the term for the total value of a deceased person's assets before liabilities and any other eligible deductions?
gross estate
A basic concept of investing is to start investing early; you want to give your investments as much time as possible to what?
grow
What document gives you the legal authority to make healthcare decisions on your parents' behalf?
healthcare proxy
The term for the amount of money, usually 2-3%, that manufacturers add to the invoice price of a vehicle and then reimburse back to the dealer after the vehicle has sold.
holdbacks
What is the tax levied by a government directly on income, especially an annual tax on personal income?
income tax
Don't calculate your net worth at the end of the month one time and the middle of the month the next. You want to compare your net worth at the same moment each time. Your objective is to track your net worth and see it ________ over time. Then you know you're on track to achieve your goals.
increase
If you lose purchasing power when investing, it's because your investment did not grow enough to keep pace with what?
inflation
What is the term for the natural increase in the price of goods and services?
inflation
What is the amount charged or paid for the use of money based on a percentage of a loan or deposit?
interest rate
What of a lump sum time value of money question determines the amount the investment will earn, or how quickly the amount will grow?
interest rate
When you're evaluating your investment options, the one that has the highest risk probably pays the highest what?
interest rate
How do you achieve your long-term goals and objectives, such as your retirement or your kid's college?
investing
Saving and what are related, but very different financial tools, used to accomplish very different financial goals?
investing
What financial concept is about building wealth over the long term?
investing
Once your emergency fund goal is achieved, you will work to strike a balance between your savings goals and your____________.
investment goals
The process of choosing a large purchase like a vehicle or home is the same process as choosing what?
investments
A will that couples can create that stays in place, even after the first person dies, is referred to as what?
joint will
When purchasing a vehicle, you need to be clear on three things: fair price you should pay, true total cost of ownership, and what?
kind of car you need
It is up to the individual to take the steps necessary to succeed and stand out above everyone else in their job; that is why it is called a career _____
ladder
These, along with collections, or accounts listed as 'settled', 'paid derogatory', or 'paid charge-off' can be and should be disputed if they are not accurate.
late payments
People often get discouraged and stop long-term investing because the bulk of the interest is earned when?
latter years
Legally, a landlord has the upper hand based on what is written on the __________, even if there was a verbal agreement to conditions such as no penalty if a payment is a couple of days late.
lease
This is a finance term that simply means cash or easy to convert into cash.
liquid
In the process of paying down debt, what is it important to list before you create a payment plan?
list all of your debts
Before you can lock in the interest rate and other terms for a period of time on real estate, what must first be approved?
loan
Before you begin investing you should ask yourself how much money you can tolerate to do what?
lose
Bottom line is that cars are expensive. They are expensive to buy, insure, finance and what?
maintain
What are many service providers willing to do in order to protect their reputation by repairing an issue with your product or service, or by offering some free additional service or some other resolution?
make it right
What is the rate of tax placed on each additional dollar of income?
marginal tax
What word in S.M.A.R.T. goal setting emphasizes how much? For example, not "I want to save more money", but "I will put $10 each week in the cookie jar."
measurable
As soon as children start learning to say please and thank you, they can begin to learn about __________.
money
Banks use depositors' money in a __________ market account to invest in government and corporate investments.
money
Contrary to popular belief, not everyone who has _____ is responsible with it.
money
This term is a savings account that generally pays higher interest than a standard savings account and has a higher minimum balance requirement.
money market account
Most ___________ have a higher minimum balance requirement and are much more restrictive with the number of withdrawals per month, but they pay a higher rate of interest than a savings account
money market accounts
Another term for a mutual fund portfolio investing in high-quality securities, liquid debt and monetary instruments that mature in less than one year, sometimes called money market funds.
money market mutual funds
Reviewing and updating your budget this often will help make you more aware of where your money goes.
monthly
Just as you did your homework before moving in to a new apartment, you have homework before when?
moving out
It is possible for a person to have a negative one of these.
net worth
When buying a home, what financial statement tells you if you have sufficient funds to cover the costs of a down payment, the costs associated with closing on the home such as attorneys' fees, home inspections, and property taxes, and the cost of obtaining a mortgage?
net worth statement
Purchasing insurance is similar to purchasing any other product, but with one significant difference. You are buying something you hope to what?
never use
To prevent yourself from being scammed, remember "if they need a decision right away," then your decision should be always be what?
no thanks
What is the term for a state with laws that require a minimum level of no-fault automobile insurance?
no-fault state
Another type of __________ banks offer is to automatically deposit a set amount into your checking account, such as $500, when you spend more than is in the account. This type of protection is a loan from the bank.
overdraft protection
Almost every __________ needs a will.
parent
___________ loans are some of the most dangerous and expensive loans available.
payday
There is absolutely no connection between a person's net worth and their worth as a ___________.
person
It is important to take proactive steps to keep a career balanced and in line with __________ goals and objectives.
personal
As you know more about your ________ and employ more tools like a budget to control them, you will make fewer and fewer unnecessary purchases. Think about famous actors, actresses, and athletes who have made millions of dollars but still end up bankrupt. It's not about having more money. It is about managing what you earn and using your money to reach your goals.
personal finances
In all personal financial decisions, it is a good idea for a person to remember his or her money __________.
personality
Most people do a __________ job of making a wise car purchase.
poor
What is a group of financial assets held by an investor such as stocks, bond, real estate, etc.?
portfolio
Assigning one of these to someone you trust, such as a responsible child or other family member, allows that individual to become your agent and advocate.
power of attornney
This term is a way to look at purchasing items by breaking down the cost in easily comparable quantities such as per ounce, per quart, or per unit.
price per quality
What is the amount of money called that is borrowed or lent and does not include interest? It can refer to the original amount or the amount remaining to be paid.
principal
Although they are convenient, these digital cash transfer apps provide little or no ________ against fraud.
protection
Historically, prices increase an average of 3% to 4% per year. That means if your investments average a 4% return or less, you lose what?
purchasing power
The four ways in which to manage __________ risks faced each day are: avoidance, assumption, reduction, and shifting.
pure
Any time a major life event occurs, a review of your tax situation is in order to avoid the "April 15th surprise." A major life event includes: graduation, marriage, divorce, having a baby, adopting a child, significantly reducing or increasing your income, changing jobs, and what other major life event?
receiving an inheritence
The steps to resolution of product defects or poor service include contacting the company, filing a lawsuit, utilize mediation or arbitration, and what?
report to a consumer protection agency
What type of accounts have tax advantages such as an immediate tax break and a deferral of taxes on your gains, or a tax break upon withdrawal, depending on your plan?
retirement
Debt allows an economy to appear very large but debt also creates more __________ in an economy.
risk
One of investing's truisms is that the greater the probability of higher returns, the more __________ that is incurred.
risk
Savvy investors avoid unnecessary __________.
risk
This up and down change, or volatility, in value over a period of time with an investment is how we define what?
risk
What is it that almost all lenders evaluate of anyone applying for a loan?
risk
When evaluating investment options, the one that pays the higher interest rate (or has the greater return) also has higher __________ associated with it (the chance of loss of some or all of the money invested).
risk
What rule can be used to estimate how long it will take to achieve a goal with a certain investment rate of return assuming a single lump sum investment?
rule of 72
Safety or low risk, convenience or easy access, and minimizing fees are all main objectives of what?
saving
This is not about making money or outpacing inflation; it's about ensuring that your money will be there tomorrow, next week, and next year.
saving
When someone is setting aside or retaining money specifically to meet short-term financial goals, they are what?
saving
Your financial goal determines if you should be investing or what?
saving
What should you do immediately if you start to get into trouble with your credit cards?
seek assistance
Budget sheets with monthly __________ indicate it is time to make adjustments in spending habits.
shortages
In your budget, what allows you to choose where to allocate the additional money by going through the categories and deciding what areas are your greatest priorities?
surplus
This term is an incentive that subtracts a set amount from your local, state, or federal tax liability.
tax credit
This is the term for tax deductions that reduce taxable income and the value depends on the taxpayer's marginal tax rate, which rises with income.
tax deduction
A traditional IRA is similar to a 401(k), without any company match of course, and you contribute up to a maximum amount each year and deduct your contributions from your what?
taxable income
Can be a recurring tax, paid year after year on property someone owns
taxable income
Investments may be sheltered from __________ by using an Individual Retirement Account (IRA).
taxes
Since __________ are infused into almost everything most people do it is important to understand what effect they have on everyday purchases and decisions.
taxes
The term for a person who has established or made a will.
testator
If you make an emotional decision, instead of a financial decision, when purchasing your vehicle, who always wins?
the dealer
When it comes to deciding where to keep one's money, investing is for:
the long-term
When it comes to deciding where to keep one's money, savings is for:
the short-term
When it comes to savings and investing, risk and return are tied together by __________.
time
The term for when the investment begins to return as much money in interest as you are investing.
tipping point
What is the term in the investment process when the investment begins to return as much money in interest as you are investing?
tipping point
If someone had invested $1 in 1930 they would have the most amount of money today if they had chosen:
to invest stocks
This term describes the total amount of income calculated before adjusting for deductions, credits, and exemptions.
total income
The easiest way to negotiate the __________ value of a car is simply to bring the printouts from several online automotive sites like Consumer Reports to the automobile dealership and to argue the case for why the car is in excellent or good condition.
trade-in
A big advantage to renting is that the home requires little maintenance costs from the renter.
true
A major life event includes things like marriage, divorce, having a baby, adopting a child, receiving an inheritance, changing jobs, or significantly reducing or increasing one's income.
true
A new car owner is contacted when something is recalled and even has legal recourse if he or she encounters a problem that the automobile dealer or manufacturer is unable to resolve.
true
A truly smart shopper realizes that sometimes it may pay to buy the larger size and throw a portion of an item out.
true
A will can be changed at any time.
true
A will is nothing more than a legal document that lets everyone know how and to whom money and other possessions are distributed upon death.
true
All states have lemon laws that apply to new cars.
true
Although a resume is the tool that helps secure an interview, a well written cover letter provides the incentive for a potential employer to read the resume.
true
An elusive goal is to balance the use of credit and debt level so oneÕs personal finances are not put at too much risk.
true
Any wage earner in the 25% federal marginal tax bracket gets to keep 75 cents of every marginal dollar earned.
true
At some point most people take care of at least one aging parent.
true
Before beginning to search for car loans it is a good idea for people to review their credit report.
true
Businesses do not buy things because they like them, but because they can make or save money from them.
true
Buying a new or used car is just one of many decisions faced in the car buying process.
true
Car dealers often show customers the invoice price during a purchase negotiation.
true
Character is one of the five C's of credit and is the willingness to pay bills on time.
true
Charitable donations are a good way for most people to reduce their estate and make sure their favorite charities and foundations are supported after their death.
true
Credit card payments should be made prior to the due date.
true
Depending upon the complexity of a parents' financial situation, an adult child can use do-it-yourself form kits, download do-it-yourself forms from online websites, or can enlist the help of an attorney to help manage their parents' finances.
true
Discount warehouses can save buyers a lot of money if they are careful, but not all bulk items are a good deal.
true
Fair Isaac Corporation (FICO) credit scores are determined from five main pieces of information: payment history, amounts owed, length of credit history, new credit, and types of credit.
true
For items that are purchased infrequently and expected to last, it is often worth the extra money to get a better quality product.
true
Health insurance should be part of almost everyoneÕs overall risk management plan to safeguard their and their familyÕs economic security.
true
How to protect loved ones at retirement and death can be addressed in wills and personal contracts.
true
If trying to build real wealth over a long period of time it is better to consider other investment options than a certificate of deposit (CD).
true
Information gathered for credit reports come from credit and banking agencies voluntarily reporting information about credit habits to credit reporting agencies.
true
It is a good idea to find ways to reduce expenses to create the largest budget surplus possible so more money can be allocated to achieving financial goals.
true
It is important for taxpayers to understand the difference between tax credits and tax deductions if they want to minimize their tax liability.
true
It is never too early to begin teaching children good money habits.
true
Just as it is a good idea to plan financially it is a good idea to plan for a career.
true
Just as it is important to talk about money with your children, it is also very important to talk to your parents about money.
true
Many first time renters with a roommate(s) assume they are only responsible for their portion of the rent.
true
Many people are surprised by how much they spend on clothes after having tracked the expense for a while.
true
Most banks do not charge their own customers to use their automated teller machines (ATM).
true
Most people are familiar with sales tax because 45 states plus the District of Columbia have some type of sales tax on purchases.
true
Most people have just one or two sources of income and it is relatively level.
true
Net worth is the difference between assets and liabilities or the difference between what is owned and what is owed.
true
On average, most people easily spend between $200,000 and $250,000 on car purchases before retirement.
true
One of the advantages of a debit card is getting additional cash back when making a purchase at the grocery or convenience store.
true
Parents may pay an unlimited amount for medical or educational expenses for their adult children as long as the parents pay the hospital, doctor, or university directly.
true
People work in a pre-tax world, but live and play in a post-tax world.
true
Quite simply, a car is a steel box with wheels that contains about 150,000 miles.
true
Risk management is a long-range, organized, systematic, planned strategy to protect assets, families, and individuals.
true
Some young couples who come from relatively affluent or even middle class homes expect to buy their first home with the same level of amenities as their parentsÕ current home.
true
Talking about money can be difficult.
true
Talking about money can be the best area of communication in a relationship.
true
Tax evasion means not paying all taxes that are legally owed, such as not reporting all income or making false claims for ineligible credits or deductions.
true
Tax preparation software applications, such as TurboTax or TaxAct, are easy to use, accurate, and inexpensive.
true
Taxes can be difficult and confusing.
true
The amount of money owed represents 30% of a credit score.
true
The credit card industry is extremely competitive.
true
The first step in developing a positive attitude at work is to believe in oneÕs self.
true
The future value of a lump sum calculation is used to determine what a given amount of money today will be worth at a certain point in the future.
true
The opportunity to earn interest is lost for every year waited to start investing.
true
The top 10% of U.S. wage earners carry almost 70% of the U.S. tax burden.
true
The waiting period on a disability insurance policy is the amount of time from when a disability is first incurred to the time when the first benefit payment begins.
true
There are many small paper registers available that allow easy tracking when writing a check or making an automated teller machine (ATM) withdrawal.
true
There are two types of warranties, express and implied.
true
There is a big difference between a debit card and a credit card.
true
There really is no advantage to raising a credit score above 720 as most lenders provide the best loan rates and terms to anyone with a score of 720 or above.
true
To answer any time value of money question, at least three of the five pieces of information must be known.
true
Understanding the affect taxes have on purchasing decisions is crucial to reaching personal financial goals in as short a time as possible.
true
Waiting to start investing significantly reduces the amount of money available later on.
true
While paper checks seem to be going the way of the dinosaur they still serve their purpose on some occasions.
true
Prepaid debit cards, or reloadable debit cards, are especially popular among these individuals. They typical do not or cannot obtain a typical bank account.
under-banked
A __________ car usually is much lower in price, but does not come with the warranty coverage of a new car.
used
What is a written guarantee issued by the manufacturer or service provider with the promise to repair or replace the purchase within a specified time period?
warrenty
What should you determine first before deciding what kind and make of car you wish to buy?
what you can afford
To help reduce spending, stop focusing on what you don't have and start focusing on what?
what you do have
Some car repair shops take cars that were flooded or in a hurricane, clean them up (cosmetically), and sell them to who?
wholesalers
A __________ is a necessity for most parents with young children because it is the best way to assign guardianship.
will
