Personal Finance Ch. 5
False
True or False: A CD is considered to be very liquid
False
True or False: A US Savings Bond is the most liquid type of saving plan
True
True or False: A common mistake in managing money is not having enough liquid assets to pay current bills
True
True or False: A credit union and a bank offer many of the same services
False
True or False: A credit union is owned by its shareholders
True
True or False: A debit card transaction should be subtracted from the check register balance
False
True or False: A direct deposit should be subtracted from the check register balance
True
True or False: ATM access is an example of an electronic banking service
False
True or False: An ATM withdrawal should be added to the check register balance
True
True or False: Higher returns on savings usually result in less liquidity
False
True or False: Insurance is not considered to be a financial service
True
True or False: The FDIC and NCUA offer insurance to depositors
True
True or False: When considering the convenience of a financial service, you should also consider the service fees of that service
True
True or False: When interest rates are falling, you want to take out short term loans
True
True or False: When interest rates are rising, use long-term loans to take advantage of current low rates
False
True or False: a regular savings account offers a higher rate of return than other plans
False
True or False: an investment company is a deposit-type financial institution
Check Register
Used to keep track of checking account transactions
Rate of return, compounding interest, inflation, restrictions, fees, liquidity, safety (FDIC and NCUA), tax considerations
What are a few things you should consider when deciding which type of savings plan to choose?
Regular, CDs, NOW, money market, and US Bonds
What are the five types of savings plans?
Cashier's check
A check from a financial institution you get by paying the face amount plus a fee
NOW Account
A checking account that pays interest
Truth in Savings Law
A law that requires disclosure of information and establishes rules for advertising accounts is called...
Certified check
A personal check with guaranteed payment
reconciliation
Bringing your check register in line with the bank's records is
$250,000
How much do the FDIC and NCUA currently insure deposits?