personal finance

Nora bought a used car and was told that she needed a personal check with guaranteed payment. She obtained a

certified check

Earning interest and previously earned interest is called

compounding

Future value of competitions are often referred to as

compounding

A budget is a record of how a person or family has spent their money

false

A commercial bank is the same thing as a credit union

false

A savings account is also known as a demand deposit

false

Birther certificates , wills, and Social Security data should be kept for up to seven years

false

Financial documents that you may need quick access to should be kept in a safety deposit box

false

Financial plans are only created by financial planners

false

Individuals are allowed to give money or items of any value to a person without being subject to estate taxes

false

liquidity and rate of return refer to the same thing

false

A home file should be used to keep

financial records for current needs.

Which of the following refers to the opportunity to withdraw your money on short notice without incurring a loss in value

liquidity

which of the following appears as a cash outflow on a cash flow statement

loan payment

A credit card is a type of

loan, borrowing

The goal of investing 50 per month for the next 12 years for your nephews college find is a ____ goal

long term

Athena wants to determine if she should itemize her deductions. She has identified several possible deductions . Which of the following is not a proper itemized deduction

miscellaneous expenses less than 2% of AGI

Aidenwants to be able to tap or waive his phone at the point of sale terminal sensor to complete purchases. Which of the following tool should he use

mobile transfer

Discretionary income equals

money left over after paying for housing, food, and other necessities

Take-home pay is also called

net pay

The amount you would have left if all assets were sold and all debts were paid in full is called your

net worth

And advantage of investing in a 401(k) plan is the

possibility of receiving an employer match on your contributions

Earnings on savings can be measured by the

rate of return

The tax that is a major source of revenue for local government is called

real estate property tax

shelby has an account at a financial institution that will waive the monthly fee if she keeps a certain amount in savings what kind of account does she have

regular checking account

Zoe signed the back of a check with the words for deposit only. She used a

restrictive endorsement

common payment choices for every day activities include all the following except

short term loan

Which of the following is a deduction to determine take home pay

social security taxes

Margaret signed the back of a check with the words pay to the order of Penelope. She used a

special endorsement

If a check is lost or stolen you should use a

stop payment order

Victor read the fine print for checking account he was thinking about using. The fine print said a minimum balance of 500 is required. if your balance falls below this level you'll be addressed a of a monthly fee of $10. Since Victor was planning to keep only $50 balance in this account how much could he be charged each year

$120

using the following table calculate the taxes for an individual with a taxable income of $20,800

$2,695

If you begin saving $2000 a year at 5% for nine years what will these funds grow to in this time.

$22,054

Brandon lost his debit card. When he realized it was gone his account had $238 and in unauthorized charges. Since he was embarrassed about his loss he didn't contact his financial situation for 45 days. What is the most he is liable for?

$238

Income that is taxed at a later date is

tax deferred income

The saving component of financial planning focuses on long-term security and includes:

A regular savings plan for emergencies

Will wants to open an account with $500 that will allow him easy access to his funds (by checks, ATMs, or debit card usage) from many locations. He also wants to earn at least a low interest rate and have federal deposit insurance. What kind of account should he open?

An interest-earning checking account

which of the following situations describes a person who could be insolvent

Assets $40,000; Liabilities $55,000

According to tax service warnings, who is responsible for supplying accurate and complete information for completing a tax return

taxpayer

Jim Johnson was laid off from his job two months ago. He just received an offer for a position that pays 3/4 the salary of his old job. Why should he set up a financial plan?

to increase the effectiveness of obtaining, using, and protecting his financial resources

Which of the following is not a valid form for filing federal income taxes

1040Z

At the end of the year Yvonne received a form from her bank the reported income from her savings. that form is called a

1099

Randy hell wants to retire in 20 years with $1 million. If he can earn 10% per year on his investments, how much does he need to deposit each year to reach his goal

17460

Financial experts recommend a debt/payments ratio of less than ____ of take-home pay

20%

The insurance coverage provided by the FDIC for a savings account is ___ per depositor per insured financial institution

250,000

how long should you keep tax documentation from the date you file your return

3 years

what should Jason's adjusted checkbook balance be?

440

Place the following steps for a personal financial plan in order

4: determine 1:review &revise

Financial experts recommend monthly savings of _____ gross income

5-10%

Brenda lost her debit card. When she realized it was gone her account had $173 in unauthorized charges. She notified her financial institution within two days. How much she potentially liable for

50

Fred has been completing his own tax returns for years. The IRS has recently contacted him with questions about some of his prior returns. How many years back is he responsible for providing documentation?

6 years

The number of personal financial records a household has organize may seem overwhelming how long do you keep copies of your tax returns

7 years

If you want $1000 3 years from now and you earn 4% on your savings how much do you need to deposit

889

which of the following will increase the net worth of a household

Decrease spending by five dollars per day

to develop financial goals one should

Identify specific, realistic goals that are measurable along with a time frame and an action plan

Patrick recently graduated from college with $20,000 in student loans and $5000 in credit card debt. He usually makes minimum payments on his debt and has been late with three payments in the last year. He wants to buy a car but was told that that his interest rate on the loan would be very high. What is most likely the reason this might be so

His credit rating is poor which results in a higher interest-rate

A joint account with Sarah and John allows

John and Sarah to both write checks on the account

A worker's primary goal should be to

Pay his or her fair share of taxes while taking advantage of appropriate tax benefit

Which of the following would increase the interest rate for a loan

Poor credit rating

Many Americans have money problems because of

Poor planning and weak money management habits

Which of the following goals would be the easiest to implement and measure

Save $100 a month to create a $2,400 emergency fund in 2 years.

Franklin is planning for a purchase of a vehicle in two years since he wants to be certain that his funds are safe which of the following should he use

a savings account

Claudettes grandchildren are seven and nine years old. One Claudette passed away, her grandchildren inherited her money. However, the will stipulated that they should not get to control the money until age 25. Which of the following should be set up to provide for the management and control the funds

a trust

A budget deficit will result when a persons or families

actual spending exceeds the planned spending

Gross income less adjustments to income equals

adjusted gross income

Which of the following is a component of money management

all of the above

Items with monetary value are referred to as

assets

Chloe signed the back of her check with just her signature she used a

blank endorsement

The problem of bankruptcy is associated with overuse and misuse of credit in the ______________ component of financial planning.

borrowing

The document they'll be most useful to plant spending and saving to achieve financial goals is the

budget

Quinton wants his retail purchases to be deducted directly from his checking account. Which of the following tools should he use?

debit card

Which of the following ratios indicates the amount of a person's earnings that goes for payments for credit cards auto loans and other debt

debt payment ratio

When calculating federal income taxes gross income include all of the following except

earned credit income

A tax imposed on the value of a person's property at the time of death is called a(n)

estate tax

Increase consumer saving and investing is likely to be accompanied by

higher interest-rates

When Paul complete his taxes he can include all the following as exemptions except

his 20 y/o son who is working full-time and living in an apartment

Which of the following is a cash inflow

income from employment

The number of personal financial records a household has to organize may seem overwhelming. How long should you keep documents relating to the purchase and sale of real estate

indefinitely

The amount levied on the value of property bequeathed by deceased person is

inheritance tax

The difficulty of converting savings and investments to cash is referred to as ____________ risk.

liquidity

A loan from a pawnshop will be more expensive than one from a bank

true

A tax credit has a full dollar affect in lowering taxes

true

Cash and prizes one on television game shows are subject to federal and state taxes

true

In an organized system of financial records birth and marriage certificates belong in a safe deposit box

true

Inflation is a rise in the general level of prices and it reduces the buying power of the dollar

true

Money management refers to day to day financial activities necessary to manage current personal economic resources or working toward a long-term financial security

true

Money market funds are not covered by Federal deposit insurance

true

Tax freedom day represents how long the average person works to pay his or her taxes each year

true

The life situation of a household includes a combination of personal factors such as age income household size and personal beliefs

true

personal financial planning Is the process of managing your money to achieve personal economic satisfaction

true

short term goals are usually achieved within the next year or so

true

when Marissa completes her taxes, she can include her qualified dependent children, her husband, and herself as exemptions.

true

The rule of 72 is

used to estimate how fast prices will double using a given annual inflation rate

at the end of the year employees receive a _____form that reports annual earnings and the amounts deducted for taxes from their employers

w-2