Finance 1904 ecu final
job/career
A _____ is what a person is doing right now to earn a paycheck, while a _______ is what they are going to do throughout their lifetime.
hybrid
A __________ mortgage consists of a fixed time period, such as 5, 7, or 10 years, after which it becomes adjustable from that point forward.
true
A big advantage to renting is that the home requires little maintenance costs from the renter.
false
A bounced check (not having enough money in one's account to cover the check) may be illegal, but it is not costly.
true
A budget is the primary tool for managing personal expenses.
true
A budget provides the insight to control impulse purchases and plan for big expenses like a used car or an upcoming vacation.
true
A career elevator speech is a 20-30 second summary of who someone is and what they are looking to do.
true
A certificate of deposit (CD) is similar to a savings account and is Federal Deposit Insurance Corporation (FDIC) insured if purchased from a bank or credit union.
true
A cover letter should be customized for each individual job application.
true
A debt-to-income ratio can easily be calculated from a budget sheet.
true
A good way to save money on disability insurance is to increase the waiting period or elimination period.
true
A hybrid mortgage consists of a fixed time period, such as 5, 7, or 10 years, after which it becomes adjustable from that point forward.
true
A hybrid mortgage is a combination of a fixed-rate and an adjustable-rate mortgage.
budget
A large tax bill can be very damaging to the __________.
an advance medical directive
A living will is what?
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.
month
A personal budget statement typically spans what time period because it aligns with how most bills are due?
true
A renter should make sure all relevant information is clearly represented on a lease, such as costs, dates, and penalties.
common goals
A successful couple should not neglect their individual needs entirely, as this can also lead to resentment, but focus on why they are a couple, and how they can help each other achieve their what?
false
A traditional individual retirement account (IRA) is similar to a 401(k) retirement account because of the company match.
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 used car usually is much lower in price, but does not come with the warranty coverage of a new car.
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.
false
According to studies most people think that their savings, specifically for retirement, are adequate.
false
After signing the lease on a house or apartment the next step is to buy homeowners insurance.
debit cards
All of the following are types of debt EXCEPT what?
reacting
All of the following are ways to manage pure risk, except what?
false
All risk is unavoidable.
true
All states have lemon laws that apply to new cars.
true
Almost anyone serious about getting out of debt can do so in a relatively short period of time.
Automobile Insurance
Almost every state requires drivers to carry some minimum level of what?
"Drive-off" price
Also called out-the-door price, what is the total price you pay the dealer that includes the negotiated price of the car, plus any taxes, mandatory fees, and overhead fees (fees that dealer charges its customers)?
personal loan
Also called unsecured loans, what are loans that are based only on the promise to repay and do not require any collateral (collateral is an asset that can be seized in the event of failure to pay back the loan)?
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.
false
Although it is important to talk about money with your children, it is not important to talk to your parents about money.
true
Although numerous commercials advertise access to free credit reports or free credit scores, the only way to get the reports online for free each year is through the annual credit report website (www.annualcreditreport.com).
true
Although the bank will certainly tell a borrower how much the bank is willing to lend, usually it is a much higher number than what the borrower can actually afford.
true
Although there are many different kinds of time value of money questions, there are only four types of time value of money problems that are important for most people to understand.
the individual consumer
Although there are multiple entities performing needed services in educating consumers or advocating for consumer rights, who is ultimately responsible for making wise purchasing decisions?
short-term
Although there is no exact cutoff point, what kind of goals tend to be less than three years in length?
true
An accountant is usually the most skilled of all tax professionals, but usually is the most expensive.
true
An accurate definition of consumer loans is any loan to a consumer which includes car loans and credit cards.
true
An adult child can help ensure their parents wishes will be followed with a health-care proxy where medical power of attorney is assigned to the child.
More from their employee than what the employee costs them
An employer must make:
TVM
An excel spreadsheet, websites such as bankrate.com and autotrader.com, apps for you phone like EZ Financial Calculators, and a financial calculator like Texas Instruments BAII Plus. What are these tools good for calculating?
Can shop around to various insurance companies
An independent insurance agent:
car payment
An obvious expense included in the transportation category on a budget sheet is a ___________.
true
An option to protect from having payments rejected or bouncing checks due to lack of funds is to use overdraft protection.
false
Answering yes to the question: Do I have enough money, or would I like to have more?? means most people are greedy; never practical.
TVM
Answers to such questions as how much you pay for your car, how much you pay for your house, how much your monthly student loan payments will be, how much it will take you to pay off a credit card, and how much you need to invest to retire comfortably are more easily determined by using which financial concept?
false
Any financial goal due in the next five years or less should be achieved through investing.
tax
Any time a major life event occurs a review of one's __________ situation is in order to avoid an April 15th Surprise
speculative
Anyone can choose not to engage in __________ risk and so it can be avoided.
Shopping by price per quantity
Anyone can save money while shopping by:
Silly mistakes
Applicants with a less than perfect resume are the first to go. Because of this, what do you remove from your r sum to stay in contention?
false
As soon as children high school, they can begin to learn about money.
minimum payment
As the balance continues to fall on your credit card, what else will continue to fall making it more difficult to pay your credit card off sooner?
minimum payment
As you are beginning to payoff your first debt with everything you can, what should you be paying on the remaining others?
prioritize
As you begin to answer the first three "W"s, it is important to _______ them in the order that is the most important for you, and no one else.
0.1261
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?
file a lawsuit
Assuming you did not sign an arbitration clause, if you were injured by a product, a product did not perform as promised, or a service was incomplete or inferior, you have the right to what?
budget
At some point most people ask, ÒWhere did my money go? There are countless ways that money seems to leak out of a __________.
true
At some point most people take care of at least one aging parent.
true
Automatic withdrawals or Electronic Funds Transfers (EFT) is when a company automatically deducts payment from a checking or savings account.
false
Bad debt has three common characteristics.
false
Banks generally don't charge a fee if the account balance falls below a certain minimum amount any time during the month.
false
Banks use borrowers' money in a money market account to invest in government and corporate investments.
false
Because of the complexity of the tax code, it is harder than ever for most people to do their own taxes.
true
Because the federal government takes a significant portion of earned income, the key to spending wisely is to understand the tax effect on decision making when spending money.
review your credit report
Before purchasing a vehicle, it's important to do this to make sure that financial history is listed correctly.
What do you want to do?
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"?
checking
Being charged for a __________ account is like having a wallet that charges every time it is opened.
career
Being prepared to take advantage of a new job opportunity is important for good __________ management.
hybrid
Both conventional and government-backed mortgages are available as fixed-rate mortgages, variable-rate mortgages, and what other type of mortgage?
commission
Both the buyers and the sellers real estate agent split the __________ when the house sells.
shortages
Budget sheets with monthly __________ indicate it is time to make adjustments in spending habits.
false
Buying a new or used car is the only decision faced in the car buying process.
$63
By understanding taxes, we can begin to understand how much money we have to earn to purchases what we want after taxes have been applied. For example, if we know we are going to earn $100, and our tax rate is 37%, how much do we have left over to purchase what we want?
true
Car dealers typically have relationships with several finance companies.
risks
Certain types of __________ can be avoided altogether by changes in lifestyle, making different decisions, and being removed from certain situations.
true
Certain types of risks can be avoided altogether by changes in lifestyle, making different decisions, and being removed from certain situations.
5 C's of Credit
Character, Capacity, Capital, Collateral, and Conditions: what are these considered?
Margaret's student loan debt provides positive financial leverage.
Charles and Margaret were discussing Margaret's high student loan balance of $65,000. Charles was wondering if any college degree was worth such a high level of debt. Margaret was sure that it was as she had earned a podiatry degree and was a very successful podiatrist. Margaret considers her student loans good debt for which of the following reasons?
false
Communication and leadership are two sets of skills very few employers value.
true
Compounding is the power behind the time value of money.
reciprocal wills
Couples may wish to make identical wills that leave everything to the other person after the first person dies. This is often referred to as what?
false
Coupons are a marketing gimmick and have no real value.
false
Credit card payments should be made on or after the due date.
true
Credit life insurance pays off a specific debt, such as a car loan, in the event that the policy holder dies.
false
Dining out is done with pre-tax dollars.
false
Discount warehouses always save buyers money because bulk items are a good deal.
risk
Eating properly, maintaining a healthy weight, exercising regularly, and generally leading a healthy lifestyle, reduces the __________ of getting sick.
value
Edmunds (www.edmunds.com) makes it easy to look up true market __________ of new and used cars.
false
Employers do not offer career paths, professional development, and opportunity.
true
Employers offer career paths, professional development, and opportunity.
networking
Engaging with individuals and professionals providing a mutually beneficial relationship, especially as it relates to careers and business and professional opportunities is referred to as ___________.
true
Even people that are very responsible with their money and never spend more than they make can have trouble covering an emergency expense if not planned for in their budget.
credit
Every __________ card application has a box that summarizes most of the key points of the contract, including the annual fee, the interest rate, the grace period, and other fees.
false
Every debit card application has a box that summarizes most of the key points of the contract, including the annual fee, the interest rate, the grace period, and other fees.
false
Extended warranties are nothing like an insurance policy as they only cover repairs.
true
Extended warranties are nothing more than an insurance policy.
false
Few employers offer professional development courses or workshops on improving communication skills.
false
Financial autonomy is never healthy for a relationship.
spend
Financial success is not about how much people make, it's about how much they
variable expenses
Fixed expenses, discretionary income, and what is vital to building a simple budget?
Discretionary Income (spending money)
Fixed expenses, variable expenses, and what is vital to building a simple budget?
true
For almost everyone, it is impossible to separate their financial life from their life.
better
For items that are purchase infrequently and expected to last, it is often worth the extra money to get a __________ quality product.
true
For items that are purchased infrequently and expected to last, it is often worth the extra money to get a better quality product.
financial services
For many people, traditional banks, such as Citibank or Bank of America, and smaller community banks offer all the __________ that they will need.
Digital cash transfer app
For many years, the only way to transfer money was by cash or check. What do we have now which enables you to split a restaurant bill with friends, reimburse your buddy for the concert tickets, or sell your old baseball card collection online.
retirement
For most people, ______ should be their first investing goal.
false
Fortunately, most people budget and plan well for a wedding.
a product to be purchased
From an employer's perspective, an employee is generally considered:
true
Good reasons for buying a new car include reduced maintenance, warranty coverage, roadside assistance, and peace of mind.
24 years
How long does it take an investment to quadruple in value if the investment yields 6% per year?
3
How many pieces must you have in order to answer any time value of money question?
true
If a person knows what kinds of job they want to do and they know the geographic areas that have lots of those kinds of jobs, they can identify specific employers for which they would like to work.
true
If the price break on buying a larger size of any item is a savings of 40% in the price per quantity, then effectively 40% of the item could be thrown out if it went bad and the purchaser would be no worse off financially.
false
If trying to build real wealth over a long period of time a long term certificate of deposit (CD) is a good option.
before the marriage begins
If you are not yet married, but planning to get married in the near future, when should you begin setting financial goals?
Utilization ratio
If you check your credit report and find credit limits that are incorrectly reported as lower than they actually are, you should get them fixed, as they will affect your________.
$26.97
If you deposit $1 per month in an account that pays 12% interest, compounded monthly, what will be the balance in the account after two years if you make no withdrawals?
$15,937
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?
Installment Loan
If you do not have a loan such as a car payment, consider taking out a personal loan and paying it off over several months. What is this type of loan?
$70
If you lend your roommate $50 to go out on Friday night and ask him to pay you back with simple interest in 4 years at 10%, how much will he pay you back?
$1,060.00
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?
seller's
In a __________ market, where there are more buyers than homes, there is less room for negotiation and the buyer may have to make an offer that is very close to the asking price.
financial planning
In four easy steps, you can identify exactly where you spend your money and, more important, you can direct exactly where you want your money to go. What is the term for this process?
risk
In general, __________ is the probability or likelihood of an unfavorable event occurring.
Understand information about any treatment options for you
In order for the individual that you designate to advocate on your behalf, they need to be able to: handle the stress of making those decisions, keep in mind your wishes, and what final understanding?
maximize your contributions to 401k
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: review all possible credits for which you may apply, contribute funds to a traditional IRA, 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?
annuity
In time value of money, what is the term for a series of equal payments or deposits over equal periods of time?
credit card companies
Including banks and other lending institutions, who will take a broad look at your financial situation to make sure you are someone to whom they want to lend money?
true
Information gathered for credit reports come from credit and banking agencies voluntarily reporting information about credit habits to credit reporting agencies.
false
Information gathered for credit reports come from individuals voluntarily reporting information about credit habits to credit reporting agencies.
risk
Insurance companies pay a lot of attention to the relationship between __________ and cost.
a larger risk management plan
Insurance is just one piece of __________.
true
Insurance policies that have multiple restrictions and few opportunities to redeem the policy or only cover very specific circumstances should be avoided in most cases.
true
Insurance should not be used to smooth out all the little bumps of life.
annual
Interest rates are always stated in what kind of terms?
unnecessary
Investing in a single asset is taking __________ risk; risk that will not be compensated by the financial markets.
Time Horizon
Investing is not always just about price. Make sure that you are investing based on how much risk you can tolerate as well as with your what?
mutual funds
Investing with this type of investment allows you to take advantage of the large gains that are possible in the stock market, while managing your risk through diversification without having to be super wealthy.
RuAnn focused on answering the "Three W's" while in college while Ira focused on his classroom work only.
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?
Ira did not tailer his resume for each individual employeer
Ira has applied for similar jobs at three different companies. He spent hours developing his resume and cover letter. He had many knowledgeable people read his resume and make suggestions for improvement. He made sure his resume reflected his current skills and experience in the best possible way. Ira thinks his resume is perfect and uses it to apply for all 3 jobs. What mistake did Ira make when he sent his resume to the three companies?
Ira should open an account with UCU Credit Union since credit unions typically have lower fees
Ira needs to open a new account with a debit card and online banking. He plans to use the account primarily to pay his bills, make purchases, and withdraw cash from ATM machines. Robert is a new accounts officer with BGB Bank and wants Ira to open an account with his bank. Charles works for UCU Credit Union and tells Ira that since he is employed by the local university that he should open an account with the credit union. Ira is very frugal and wants to minimize his fees. What should Ira do?
Ira should review his budget first to determine how much car he can afford.
Ira needs to replace his car. It is nine years old with 168,000 miles on it. The maintenance and repair costs are now as much as a monthly car payment. Ira visited several local car dealerships and each has told him he qualifies for $27,500 car. Should Ira shop for cars at this price since more than one dealership told Ira he can afford a car in this price range?
unnecessary
It is __________ to pay the full asking price of an extended warranty when purchasing a car.
true
It is a good idea to keep automated teller machine (ATM) receipts.
false
It is a good idea to wait until parents are comfortable with money to begin teaching children good money habits.
true
It is easier than ever for most people to do their own taxes.
true
It is expected that interest rates for consumer loans will be higher than car loans, mortgages, or student loans.
true
It is never too early to begin teaching children good money habits.
false
It is not important for taxpayers to understand the difference between tax credits and tax deductions since both reduce your tax liability.
false
It is not substantially important to be prepared for the next job along the way in a good career path plan.
true
It is not uncommon to buy a home with a beautiful view of a forest or of a peaceful farm landscape only to find the view turned into that of a grocery store parking lot or a 500-unit apartment complex a few years later.
ladder
It is up to the individual to take the steps necessary to succeed and stand out above everyone else so that they can advance in their job; that is why it is called a career what?
Negotiate better terms
It's easy to call your current credit card company to do what?
balance
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.
career
Just as it is a good idea to plan financially it is a good idea to plan for a __________.
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
Just like a diet is easier to stick to when there is a goal such as an upcoming class reunion or a trip to the beach, it is easier to stick with a budget when there are well defined financial goals.
true
Just like any other purchase, it is a good idea to shop around for mortgage companies that have the best rates and the best service.
true
Leadership skills are very important to almost every employer in almost every field.
true
Legally, a landlord has the upper hand based on what is written on the lease, even if there was a verbal agreement to conditions such as no penalty if a payment is a couple of days late.
28%
Lenders typically approve most borrowers for up to what percentage of their gross monthly income for a total monthly house payment?
declined
Let's say you have $100 in your account and you only get $18 in gas. You expect $82 to still be available. But if you try to buy something for $50 your card is _______ because you have access to only $25 thanks to the $75 block.
low
Let's take a look at the relationship between unemployment rates and education level. When you understand this relationship, you see an encouraging trend. If the education level is high, what should the unemployment rate be?
false
Life insurance should be used to protect the insured from financial loss.
long-term goals
Lifestyle forces have a profound impact on your short-term, mid-term, and even _________.
false
Maintaining good physical health does not impact your financial health.
true
Maintaining good physical health is also an investment in good financial health.
agents
Many more people are involved in a real estate transaction than just the real estate __________.
forgotten bills
Many people forget to take into account bills that do not come due every month, because they do not use a budget. For instance, many automobile insurance policies are due every six months. These are just a few examples of __________.
true
Many people routinely overbuy and overpay for vehicles that are more car than what they need or more car than they can afford.
withdrawals
Many savings accounts typically limit the number of these to usually three to six per month.
the advantages of renting vs owning a home
Mobility, no maintenance, and very low carrying costs refer to:
protection against future losses
More car for the money, predictable costs, and what are advantages of leasing a vehicle?
predictable costs
More car for the money, protection against future losses, and what are advantages of leasing a vehicle?
false
Most Americans plan well for retirement.
false
Most banks charge a small fee for their own customers to use their automated teller machines (ATM).
true
Most experts agree that 5% profit on the sale of a car is fair to both the automobile dealer and the buyer.
false
Most organizations that have a defined benefit or traditional pension retirement plan open these plans to all employees.
Credit Scores
Most people understand that ________ are important, but they don't necessarily understand how they work - or sometimes life just gets in the way.
false
Most people understands how their housing needs are closely tied to their other goals and objectives.
initiate contact
Never provide your credit card number, social security number, or any other information to anyone unless you do what first?
false
No financial expert advocates to pay off the loan with the highest interest rate first.
money
Nobody updates their Facebook page with a status about saving this term, however, people always post about spending what?
true
Normally a debit card is linked to a checking account, but it can be linked to a savings account or money market account as well.
fees
Not knowing the details of how your debit card works can cost you a lot in ____ over the long run.
depreciate
On average, cars __________ about twenty percent of their value each year.
$200,000 and $250,000
On average, how much will you spend on cars during your working life?
true
On nearly all real estate contracts there are contingency clauses.
fees and other charges
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?
investment goals
Once your emergency fund goal is achieved, you will work to strike a balance between your savings goals and your____________.
false
One easy way to control spending is never to use the envelope system.
return
One of investing's truisms is the more you are willing to risk, the greater your expected what?
dining out
One of the easiest categories to find extra money in someone's budget that they can control is:
true
One type of overdraft protection banks offer is to automatically deposit a set amount into a checking account when the account is overdrawn.
1040-A
Out of the three tax forms you should concern yourself with, this is for those with a slightly more complicated tax situation.
1040EZ
Out of the three tax forms you should concern yourself with, this is the easiest form and is for those with very basic income and tax situations.
false
Parents may pay an unlimited amount for medical or educational expenses for their adult children whether paid to the child or the provider so long as there are receipts.
illness
People use insurance to help protect themselves, and the people they care about, from financial loss due to disability, legal liability, property loss, and what other scenario?
false
People who are frequent users of automated teller machines (ATM) and their bank charges them to use their ATM should try to get the fees waived.
under-banked
Prepaid debit cards, or reloadable debit cards, are especially popular among these individuals. They typical do not or cannot obtain a typical bank account.
more car for the money
Protection against future losses, predictable costs, and what are all advantages of leasing a vehicle?
150,000
Quite simply, a car is a steel box with wheels that contains about _________ total miles.
extended warranty
Rather than purchasing this, which researchers have determined is not a good value for consumers, an emergency fund is a better way to pay for an unplanned for repair or replacement.
false
Regardless of the debt elimination approach selected, it is usually wise to pay off any federal student loans or any mortgage first, even if they have the lowest rate.
none
Regardless of what you may have been told, according to recent studies, how many of us are special?
false
Renters build equity in their home.
saving
Safety or low risk, convenience or easy access, and minimizing fees are all main objectives of what?
6.86 years
Sam refuses to retire until his retirement account has a balance of at least $300,000. Sam refuses to make any more deposits in the account. The account currently has a balance of $200,000 and earns 6% per year, compounded semi-annually. How long does Sam have before he will retire?
short-term
Save enough money to establish an emergency fund is what kind of financial goal?
false
Sending just a resume without a cover letter when applying for a job is always appreciated by recruiters.
cover letter
Sending just a resume without this when applying for a job makes it likely that the application will be ignored, set aside, or trashed.
price per quantity
Shopping price per ounce, pound, quart, serving, etc. is what type of shopping?
budget sheet
Simply learning where money is spent needlessly and then purposefully directing where money goes in the future will balance almost any __________.
month
Since most bills are due monthly, a personal budget sheet should typically span how long?
ATM fees
Some banks charge each time you use their ATM. If you are a frequent user of ATMs and your bank charges you to use its ATM, you may consider finding a bank that does not. What should you try to avoid?
basic checking
Some banks offer this type of account that pays no interest and typically requires no minimum balance and no fees.
true
Some financial autonomy is healthy for almost any relationship.
true
Some people think coupons are worthless, but it is easy to save at least $10 per trip to the grocery store.
difficult
Sticking to a budget can be __________ because it does not simply involve numbers.
planning
Summarized in one word, how do you get the most out of your college education?
false
Talking about money is always the best area of communication in a relationship.
true
Talking about money with parents may be more difficult than talking about money with children.
false
Tax avoidance 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 on purchases include sales taxes and excise taxes.
Roth 401k
Term for a retirement investment account where contributions to an account are taxed (made with after-tax dollars), qualified withdrawals during retirement are tax free, and available to employees of for-profit entities.
residual value
Term for the estimated value of a car turned in at the end of the lease.
buyer's remorse
That bad feeling you get when you spend too much money and the stress and worry you have when your account is too low is often referred to as what?
safe deposit box
The FDIC and NCUSIF do not insure every type of account that a bank or a credit union offers. They typically do not insure money invested in stocks, bonds, mutual funds, or life insurance policies or other annuities, even if you have them invested with or bought them from an insured bank. What other financial service do they NOT insure?
Consumer Financial Protection Bureau (CFPB)
The ________ focuses on enforcing federal consumer finance laws. They take consumer complaints, write rules regarding consumer finance, promote financial education, and enforce consumer protection laws.
find money that is already there
The best way for people to find more money is:
false
The discount 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.
overspend
The ease of credit provided by credit cards makes it very easy to do what?
credit union
The first place most people turn to for a loan is a bank. Others may turn to who?
net worth
The first step in the home-buying process is to consult the __________ statement.
on time
The first, and easiest, way to keep a good credit score, is to pay your bills how?
false
The four "W's of career management provide a lens through which to view a career plan.
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.
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.
tax avoidance
The goal of estate planning is to practice what by utilizing the available tax laws to minimize your estate tax liability?
$1,560.00
The innocent $6.00 Starbucksª coffee when purchased just twice a week adds up to over $624 a year. Buy one every week day and how much will it cost you in a year?
index
The interest rate of a variable-rate mortgage varies over time and is tied to a specific what?
false
The last step to achieving personal financial success is setting personal financial goals.
false
The last step to getting out of debt is to stop getting deeper into debt.
false
The location or venue of a wedding an insignificant expense when paying for a wedding.
Securities and Exchange Commission
The mission of the this agency is to protect investors, maintain fair, orderly, and efficient markets, and to facilitate capital formation.
specific
The more ________ you make your financial goals, the easier it is to track movement towards achieving them.
true
The more specific financial goals are made, the easier it is to track movement towards achieving them.
true
The need for instant gratification can easily lead to a personal debt crisis.
true
The old argument that a tax refund is like having a built-in savings plan is a very poor argument as there are better ways to save.
true
The power of compounding is how a small amount of money, such as a one-time deposit of $2,500, grows into a million dollars.
true
The present value of a lump sum is used to calculate what a future dollar amount is worth today.
true
The present value of an annuity calculates how much a regular series of payments will be worth at some point in the future.
advantage
The primary __________ of buying a new car is lower maintenance costs and peace of mind.
true
The purpose of the resume is not to get a job, but to get an interview.
false
The purpose of the resume is to get a job.
financial goal
The real difference between saving and investing is that we save to spend and we invest to grow wealth. And the real key to successful saving and investing is to match what to the right type of saving or investment instrument?
begin to align their budget sheet to their financial goals
The real power of the budget sheet is people can use the spending they track to do what?
report to a consumer protection agency
The steps to resolution of product defects or poor service include contacting the company, filing a lawsuit, utilize mediation or arbitration, and what?
Buyer's Market
The term for the general description of the housing market when supply of homes by sellers is greater than demand for homes by buyers.
Arbitration
The term for the settling of a dispute by using a neutral third party to make a binding decision on both parties.
true
The three W's of career management are what, where, and who.
true
The three W's of career management provide a lens through which to view a career plan.
financial life cycle
The three primary financial phases individuals transition throughout their lifetime are referred to as what?
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.
resale value
There are many other hidden costs to home ownership of which you at least need to be aware, like school districts, zoning restrictions, and what final hidden cost?
mortgages
There are three types of __________: fixed-rate, adjustable-rate, and hybrid.
term
There are two basic types of life insurance: __________ and cash value.
true
There can be a lot of emotional energy in a money conversation.
Credit monitoring services
These aim or claim to monitor all three of your credit reports and to do everything from notifying you on a monthly basis about any activity on your reports, to repairing your poor credit, to restoring your identity should it be stolen. They heavily advertise their free services to get you to view their website. Once you are on their site, they offer you other services for which they charge.
goals
These can be short-term, mid-range, or long-term.
budget sheet
These should be kept simple while still being useful.
speaking
These skills will improve with the more presentations you give in class which is why it is important to volunteer in group projects, but this may not be enough.
debit card
This card uses the same networks as credit cards. You may also find the VISAª or MasterCardª logo on most of them and you swipe them through the same machine at the store.
prepaid debit cards
This is a debit card that is not linked to a bank account and can only be used to spend the amount of money pre-loaded onto the card in advance. They are generally accepted the same as any major debit card if affiliated with a particular network such as Visa, Discover, MasterCard or Amex.
American Association of Retired Persons (AARP)
This is a member organization dedicated to helping people aged 50 and older. They focus on all aspects of life for their members, including advocacy in areas, such as Social Security and health care.
capital
This is one of the five C's of credit and refers to total assets (things owned) and net worth (the difference between what is owned and what is owed).
underwriting
This is the process of reviewing a customer's risk level by conducting a thorough review of their credit worthiness along with other financial documents.
Renters Insurance
This is the term for a form of property insurance that covers the belongings and liability of the individual renting a dwelling.
fixed annuity
This is the term for a type of annuity that pays the same amount of payout to the purchaser during their lifetime.
annual fees
This is the term for fees charged each year that includes management, administrative and 12b-1 costs.
tax deduction
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.
rider
This is the term for the add-on provision to an insurance policy that increases coverage beyond standard items or amounts.
medicare part D
This is the term for the optional portion of Medicare that covers only prescriptions at an extra premium.
medicare part C
This is the term for the optional portion of Medicare that covers prescriptions, dental costs, vision care, etc. at an extra premium.
career
This is the term for what you are going to do throughout your lifetime, something that you manage. It is not what you do right now to earn a paycheck.
middle class
This term describes a group of people whose income is between 75% and 25% of all income earners.
home care
This term describes services that take place inside the home such as bathing, and light housework, provided for otherwise independent adults with mobility or disability issues.
probate
This term describes the court process where a will is validated or invalidated.
primary care physician
This term describes the doctor chosen as the first primary contact for any health issues.
Estimated taxes
This term describes the periodic advance payments of taxes based on an estimation of expected income and the tax liability on that income.
Medicare Part B
This term describes the portion of Medicare that covers outpatient stays, physician charges, some medical equipment, and parts of services not covered by Part A.
money market account
This term is a savings account that generally pays higher interest than a standard savings account and has a higher minimum balance requirement.
price per quantity
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.
executor
This term is the person designated by the testator to carry out the terms of the will, such as distributing property.
discretionary income
This term is what is left over to spend after you have paid your necessary expenses including taxes, insurance, and other obligations.
TVM
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.
values
This term refers to the things you believe are important in the way you work and live. Beyond what you do, they affect the way you wish to do them as well.
personal floater policy
This type of insurance policy typically covers a specific item that is easily moveable from loss or theft, and unlike a rider, it may also cover you from loss of the item from your own negligence.
all of the above
To avoid spending more than necessary, while maintaining safety with paper checks, you should do what?
true
To determine a comfortable car payment, the two pieces of information needed are monthly principal plus finance costs and insurance costs.
1
To find the interest per period, simply divide the interest rate by the number of compounding periods. If it is annual, divide by what?
365
To find the total number of compounding periods, you multiply the number of years by the number of compounding periods. If it is daily, multiply by what?
52
To find the total number of compounding periods, you multiply the number of years by the number of compounding periods. If it is weekly, multiply by what?
plan one's purchases
To keep financial plans from failing you should do what?
their office
To make a great impression, where should you visit your professor?
disability
Typically, when early in a career both short-term and long-term __________ coverage are needed.
false
Understanding time value of money is not necessary to making good financial decisions.
Unlike your resume and cover letter, which are very formal documents, this online profile should be written in the first person. This profile should be more personal and speak passionately about the things you want to highlight about your professional life.
People can easier control their spending since they can watch their cash diminish
Using the Envelope System for budgeting means:
false
Very few people are involved in a real estate transaction.
illness
We face many risks. Not fully inclusive, the list includes: disability, identity theft, death, financial, property, liability, and what other form of risk?
Reduced Maintenance
What advantage is there to owning a new car (not needing new tires, a battery, or new brakes) during the first few years of ownership?
U.S. Postal Inspection Service
What agency is charged with protecting the infrastructure of the postal system as well as its employees and customers?
Internet Crime Complaint Center
What agency is part of the FBI and is charged with receiving reports of, and dealing with, cybercrimes including online fraud?
capital
What are assets owned by the borrower?
overspend
What are couples more likely to do, usually by accident, when they do not communicate about their goals and finances?
estate planning
What concept is about properly managing your assets while you are alive and transferring them upon your death?
Variable Rate Mortgage
What do many experts see as one of the causes of the housing crisis of 2008, as too many homeowners were barely able to afford their payments during the low teaser rates?
minimum balance
What do some institutions require in your account to avoid monthly service fees?
block
What do some merchants often do to your account that you should be careful of when purchasing gas?
mobility
What do you lose when you buy a home, which is a real hidden cost to homeownership, that potentially can prevent you from progressing in your career?
true
What do you want to do? Where do you want to do it? And who do you want to do it for? These are three easy questions to ask, but can be difficult to answer when managing a career.
living will
What document establishes your parents wishes for medical decisions, such as desired quality of life, resuscitation, and types of end-of-life treatments that they do or do not wish to receive?
estate tax
What federal tax is a one-time tax the government charges for your right to transfer your property upon your death?
cash
What gives you the greatest advantage when negotiating a car purchase?
Casualty Insurance
What is a broad category coverage of insurance against loss of property, damage, or other liability?
small claims court
What is a court within a local jurisdiction where small-dollar cases can be tried quickly for a small fee and without legal representation?
People cannot access their money for a period of time without penalty
What is a disadvantage of certificate of deposits?
mint
What is a good online app that allows you to link your financial information from multiple accounts and institutions to an online budget? All your information from your checking account, savings account, car loan, payments, deposits, etc., are automatically updated and linked to your financial goals that you input. Essentially, it automates tracking and maintaining your budget.
Automatic direct draft
What is a good strategy to make sure you make all your monthly bill payments on time?
futures
What is a legal agreement to buy or sell a specific asset, usually a commodity, for a specific price at a point in time?
mortgage
What is a loan for a house, where the house itself is collateral for the loan?
zoning laws
What is a local law that restricts the use of land or real estate?
load funds
What is a mutual fund that has sales charges or commissions?
Lifetime Learning Credit
What is a tax credit for qualified higher education tuition and expenses paid for an eligible student?
non-refundable tax credits
What is a tax credit that you may not receive as a refund and can only receive this credit up to the amount you owe in taxes?
real estate tax
What is a tax levied on an individual's non-movable property by the county or state they reside?
addendum
What is a written addition to a previously executed contract which becomes enforceable as part of the original contract?
scam
What is an endeavor purposefully design to defraud or swindle an unsuspecting individual or group of some resource, also known as a sham?
property insurance
What is an insurance product that covers the financial loss on a structure and/or its contents?
money market funds
What is an investment fund, that is comprised of short-term securities designed to generate interest for the shareholders while maintaining a net asset value (NAV) of $1 per share called?
long-term care insurance
What is designed to provide benefits, such as payment assistance for a nursing home facility, assisted living, adult day care services, home care, home modifications, care coordination, and future service options?
$814.50
What is future value of $500 deposited today at 10% interest compounded semi-annually for 5 years?
rates of return
What is gain or loss calculated as a percent of original value of an investment beyond the original value of the investment?
Private Mortgage Insurance (PMI)
What is insurance paid by a home buyer or home owner to secure a home mortgage when the mortgage is 80 percent or more of the value or purchase price of the home?
debit card
What is issued by a bank that can be used to make purchases, similar to a credit card, or withdraw cash from ATMs? They typically can only be used to spend the amount of money the cardholder has in the associated bank account.
speculative investing
What is it called when you invest with a high degree of risk based on the volatility or price fluctuations of the investment?
escrow account
What is money that is held by a third party to make payments on someone's behalf? In real estate, this usually includes real estate taxes, homeowner's insurance, and mortgage insurance, if applicable.
missed payments
What is one of the first ways people begin to fall behind and ultimately hurt their credit score?
Federal Deposit Insurance Corporation
What is the FDIC?
National Credit Union Administration
What is the NCUA?
Letter of Last Instruction
What is the best way to ensure that your survivors know what you want written in your obituary and have access to important documents, such as life insurance policies and other benefits?
matching contributions
What is the dollar amount an employer matches to an employee's retirement account through work, usually a percentage of the amount an employee contributes to his or her own account?
interest
What is the fee charged by a lender of money to the borrower? It is also the rental fee to use someone else's money.
balance
What is the key to debt and debt levels so you do not put your personal finances at too much risk?
learn to live on less
What is the key to saving?
after tax multiplier
What is the mathematical formula used to easily calculate the amount of money remaining, or the net interest rate cost after adjusting after adjusting for the marginal tax rate?
FICO
What is the most common credit score formula used?
$729.10
What is the present value of $300 received at the end of year 1, $400 received at the end of year 2, and $200 received at the end of year 3, assuming an interest rate of 12%?
$533.36
What is the present value of $800 received at the end of year six, assuming a 7% interest rate?
marginal tax
What is the rate of tax placed on each additional dollar of income?
contact the company
What is the simplest way to resolve an issue with a product or service?
Income tax
What is the tax levied by a government directly on income, especially an annual tax on personal income?
tax avoidance
What is the term describing someone legally arranging finances in a manner to minimize tax liability?
universal life
What is the term for a cash value life insurance policy that builds a value that can be returned to the insured upon surrendering or canceling the policy or used to reduce the premiums?
American Opportunity Credit
What is the term for a partially refundable tax credit for qualified education expenses with a maximum of $2,500 during the first four years of postsecondary education for an eligible student?
Catastrophic Injury
What is the term for a serious and permanent injury to the spinal cord or brain that would prevent you from working again?
no-fault state
What is the term for a state with laws that require a minimum level of no-fault automobile insurance?
Letter of Last Instruction
What is the term for an informal letter providing extra instructions on the details of a will or regarding issues outside of the will?
long-term care insurance
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?
Guaranteed Renewable
What is the term for an insurance policy that the insurance company must allow the insured to renew at the end of the policy term?
itemized deductions
What is the term for listed, or itemized, expenses or contributions you are permitted to deduct from your federal taxable income as calculated on Form 1040, Schedule A?
conforming
What is the term for mortgage loans that meet certain limits, terms, or conditions as required by Fannie Mae, Freddie Mac, or the Federal Housing Finance Agency (FHFA)?
bounced check
What is the term for not having enough money in your account to cover the check? It is not only illegal, but it is also costly. Almost all banks and merchants charge a fee when this happens, usually around $35 per occurrence.
estate taxes
What is the term for taxes levied on the net value of the estate of a deceased person before distribution to the heirs?
Assests
What is the term for the collective property you own?
beneficiary
What is the term for the individual designated to receive benefit from the payout of a life insurance policy, will, etc.?
After-tax dollars
What is the term for the net amount of money remaining after deducting marginal taxes?
average tax rate
What is the term for the percent of taxable income paid in income taxes?
Adjusted Gross Income (AGI)
What is the term for your total income minus specific deductions?
good debt
What kind of debt is it when the purchased asset appreciates in value, provides positive financial leverage, and lasts longer than the debt?
silver plan
What plan covers 70% of healthcare costs, and has higher premiums with lower average deductibles, of just under $3,000?
excel
What powerful computer software application already has the TVM functions built into the product?
Workers Compensation
What program, paid by your employer, will financially assist you if you are injured while at work?
fees
What should you be aware of that may be charged to use prepaid debit cards? Some are as much as $20 to activate the card, then a recurring $4 just to keep the card.
credit report
What should you check annually to make sure there are no errors?
advantages and disadvantages
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?
for deposit only
What should you include on your check as a restrictive endorsement to ensure not just anyone can cash your check?
inheritance tax
What taxes are one-time transfer taxes, similar to estate taxes, but are levied by individual states?
Joint Tenancy
What term describes when ownership of property is transferred to last surviving owner which is common among married couples?
retirement
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?
personal
What type of loan is generally unsecured?
defined contribution plan
What type of retirement plan is one where you and your company contribute a defined amount of money to your retirement fund?
true
When adding payroll tax (FICA) rates to the marginal federal tax rate and the marginal state tax rate it is easy for wage earners to pay 37% or more of their marginal income in taxes.
true
When beginning to invest it is usually best to start with simple investments.
true
When buying a car it typically is better to make a financial decision rather than an emotional one.
how many hours would I have to work at my job to pay someone else
When deciding if you should pay someone else to do something for you, you should consider the following: can I do this myself, how difficult would it be to learn to do this myself, can a friend or someone else assist me instead of a professional, and what?
Can a friend or someone else assist me instead of a professional
When deciding if you should pay someone else to do something for you, you should consider the following: can I do this myself, how difficult would it be to learn to do this myself, how many hours would I have to work at my job to pay someone else, and what?
highest
When developing your plan to pay off debt, many financial experts advocate to pay off the loan with this interest rate first.
Step 4
When developing your plan to pay off debt, you should focus on one loan at a time. Make the minimum payment amount on every loan except the one you decide to pay off first. Which step is this on your journey to reducing debt?
full security deposit
When ending your lease on your apartment, you should vacuum, wipe the floors, clean the refrigerator and the oven, and scrub the bathrooms. These are all recommendations to get what back?
nobody
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?
Married Filing Jointly
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?
go on sale
When making almost any purchase, there is no need to pay full retail price. Just wait for the product to do what?
cashiers check or money order
When making payments to a debt collections company, how should all payments be made?
It can be hard to discern a bargain for people who are not shopping price per quantity
When making purchases in bulk:
all of the above
When most people know how to properly use a net worth statement and a budget sheet they find themselves well on their way to taking what over their money?
Always get everything in writing, otherwise the deal does not exist
When negotiating with lenders and collection agencies people should:
transferring financial risk only
When people practice 'Shifting' risk they are doing what?
emotional
When purchasing a car people want to avoid making a(n) _______ decision
extended warranty
When purchasing a vehicle, an insurance policy that the dealer will fix any covered item for an expressed length of time is referred to as what?
ego
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?
Compounding Frequency
When solving for an interest rate in a time value of money problem or question, you should multiply the answer by what to convert it to an annual rate?
false
When someone is approved for a loan it means they can afford it.
Annual Percentage Rate (APR)
When someone uses the term APR, they mean what?
lower fees
Which features generally refer to a credit union when compared to a bank?
cable hook-up fee
Which of the following is NOT required at closing on a home purchase?
monthly cost
While each month should be treated separately as a budget is developed, non-monthly expenses can be estimated by using their average of what?
Manguson-Moss Warranty
While each state's vehicle lemon law vary, the federal lemon law is consistent across all states and is known as what?
you
Who is responsible for upgrading yourself to the luxury edition while you're in school?
insurer
Who is the individual or organization that underwrites and agrees to pay for the covered financial losses of the insured?
an accountant
Who is the most skilled of all tax professionals, but also the most expensive?
real estate angent
Who should you contact once you begin shopping for a new home?
nobody
Who should you pay to do things that you are capable of doing for yourself?
speculative
With __________ risk there is a chance of loss, but there is also a chance of significant gain.
true
With direct deposit, money is wired or electronically transferred directly into an account.
true
With such a large investment in a home and all the cash outlays to make the purchase, it only makes sense to protect it with a good homeowners insurance policy.
successful
You are often measured by how you look to others. If you drive a nicer car or have a bigger house or more toys then you are "perceived" to be more what?
credit report
You can equate this as your financial report card or your financial transcript.
$177.14
You decide against purchasing a new car, and go for the used car instead. You find one for $6,000.00 and have a car loan with an APR of 4%. What is your payment if you are trying to pay the loan off in three years?
10.16 months
You friend just purchased a new car and you have a feeling she got ripped off. She told you she paid $19,999.99 and her car should be paid off in 5 years. You happen to be interested in the same vehicle, and based on your research, she should have paid a maximum of $15,999 (including the dealer commissions). She could squeeze out a $500 car payment, which is a lot, and she's been approved at a 7% APR. How much time could she have saved if she did her homework?
$1,124,786.25
You've have two retirement accounts. The first was an original deposit of $100,000 that earned 6% annual interest. The second is one that you've been contributing $250 for the last 35 years into your company's retirement account and earned a 6% growth rate. You started both accounts 35 years ago. How much are you retiring with based on your two plans?
$532.80
Your best friend has written you an IOU for last nights bar tab agreeing to pay you $800 at the end of 6 years at the same interest rate you now earn on your savings account. You currently are earning 7% interest compounded annually. What was your friends bar tab?
32.84 years
Your bonus room needs a big screen TV. You think $50 a month for that 70" big screen TV for $2,500 from a rent-to-own company sounds like a great bargain. And the company is charging you only a 30% annual interest rate. How long will it take you to pay off that TV?
saving
Your financial goal determines if you should be investing or what?
$729.10
Your mom needs to borrow grocery money from you to feed you and your eight brothers and sisters. You agree to lend her the money at 12% interest compounded annually. She agrees and tells you she can pay you $300 in one year, $400 in two years, and $200 in three years. How much are you going to lend her?
goals
Your stage in the financial life cycle and other external lifestyle forces have a significant impact on your what?
collision
__________ insurance coverage pays for damages to a car when it is involved in an accident.
pure
__________ risk is accidental or unintentional in nature.
avoidance
___________ is the cheapest and easiest way to manage risk.
risk
every insurance has its own type of
