FINA 1904 Quizzes
You want to build equity in your home faster by opting for a 15-year mortgage instead of a 30-year mortgage. You bought your home for $200,000 with an APR of 4%. What is your monthly payment?
$1,479.38
You want to buy a new car. You check you budget and know the maximum you can comfortably afford is $250.00 for a monthly payment. You've also researched car loans and found you can be approved for a 5% APR car loan for 4 years. What is the maximum price for a car you are willing to pay if you have no down payment and no car to trade in?
$10,855.74
You deposit $100 in the bank and leave it there for two years. Your account earns 10% compounded annually. At the end of two years, how much is in your account?
$121.00
Mutual fund or ETF, what to do what to do? A possible mutual fund offered through your work retirement account offers an average growth rate of 10% with a 1.7% management fee. Conducting your own research you uncover a Tech industry ETF offering an average annual growth rate of 9% and no fee. If you started late at 30, but choose the most advantagous plan,what should your payment be if you're hoping to hit a minimum of $1.5M when you retire at age 65?
$509.89
When evaluating your credit score, what percentage weight does new credit represent?
0.1
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.
1040-EZ
To find the interest per period, simply divide the interest rate by the number of compounding periods. If it is semiannual, divide by what?
2
Retirement time and you begin to review the two accounts you and your spouse have participated in at work. Your wife's account has $1.3M. You are ashamed to open your account to a measly $800,000. You both made the same $300 monthly payments and have been participating in the retirement accounts for the last 40 years. What was the growth rate difference between the two retirement accounts?
2%
Assume that your grandmother left you an account with $96,462.93 in it. She originally deposited $10,000 at 12% interest. How long did it take for the account to grow this big?
20 years
Children under what age are still eligible to stay on their parentsÕ health care plan?
26 years
Lenders typically approve most borrowers for up to what percentage of their gross monthly income for a total monthly house payment?
28%
Since earnings in these types of retirement accounts are not taxed until you withdraw the funds from your retirement account, highÐturnover ratio funds are an excellent way to minimize the tax consequences of your mutual funds.
401k and IRA
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?
63
There is no real advantage to raising a credit score above what number? Most lenders provide the best loan rates and terms to anyone with this score or above.
760
When looking to buy a home, your net worth statement tells you if you have the ability to obtain a mortgage, sufficient funds to cover the associated closing costs, and what else?
A down payment
Why create a separate budget for each month and not just one budget that applies to all 12 months of the year?
A, B, and C are correct
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?
ATM fees
When looking to buy a home, your net worth statement tells you if you have sufficient funds to cover the costs of a down payment, associated closing costs, and what else?
Ability to obtain a mortgage
Lenders look at two factors before they lend money to you. The first is your willingness to use your resources to repay your loan. The second is what?
Ability to repay your loans
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
This lifestyle force includes your age as well as the age of other family members.
Age
While many students view estates, wills, and powers of attorney as matters to be addressed in their 50s, 60s, or 70s, who's interest should they not neglect to consider?
Aging parents
For a person to get their dream job, they must identify:
All answers are correct
Most people spend money when they:
All 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 answers are correct
What cost do many students and parents worry the most about?
All answers are correct
When it comes to deciding where to keep one's money, investing is:
All answers are correct
When using websites for researching the price of a new car, people should be looking for:
All answers are correct
When negotiating the price of a car the salesperson will:
All of the above answers are correct
To protect children from financial failure parents should:
All of the above are correct
Ultimately when fighting about money it is better to fight for the truth than to fight to __________.
All of the answers are correct
Which of the following statements about risk are true?
All of the answers are true
Which of the following will help someone avoid getting scammed or ripped off?
All of the answers are 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 ___________ as their parentsÕ current home.
Amenities
This term describes 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.
American Opportunity Tax Credit (AOTC)
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?
American opportunity credit
This is the term for fees charged each year that includes management, administrative and 12b-1 costs.
Annual fees
What does a credit card company charge to cardholders simply for the privilege of having the card which can range from $10 per year to hundreds of dollars per year?
Annual fees
A(n) __________ is simply the same amount of money invested or paid on a regular schedule, such as weekly, monthly, or annually.
Annuity
What is a financial term that means equal payments at equal time intervals?
Annuity
Good debt has three common characteristics; last longer than the term of the loan; provide positive financial leverage, and what?
Appreciate in value
What is the term for the collective property you own?
Assets
Good __________ means more than the ability to write well or to deliver a good presentation.
Attitude
The most important trait to move your career forward is the right what?
Attitude
Almost everyone is satisfied with being what? This means that you donÕt have to work much harder to stand out from the rest of the crowd. It doesnÕt take that much more work to be really exceptional.
Average
Receiving direct deposit, average daily balance, basic checking, and avoiding ATM fees are all ways to what?
Avoid checking account fees
If you use your debit or credit card for all of your purchases, what is the easiest way to categorize and track your expenses for the month?
Bank statement
The real power of the budget sheet is people can use the spending they track to do what?
Begin to align their budget sheet to their financial goals
The ease of __________ provided by credit cards makes it very easy to overspend.
Borrowing
If you want to save money or spend it on other things other than coffee, you can quickly save by doing what?
Brew your own coffee
The amount you spend on gourmet coffees, energy drinks, and power smoothies are highlighted on your what?
Budget
What simple financial tool is all we need to figure out what bills must be paid and when, and how much money we have available to pay them?
Budget
Many people purchase a car, usually with payments at least 10% higher than they originally wanted, then try to figure out how to squeeze the payments into their what?
Budget sheet
What is it called when you add up all of your expenses and subtract that number from your income and the result is positive?
Budget surplus
Although this is a process, it does not have to be a complicated one. What is it?
Budgeting
The term for a real estate agent or broker that represents the home buyerÕs interest.
Buyer's agent
An obvious expense included in the transportation category on a budget sheet is a ___________.
Car payment
What is a short-term loan where borrowers use their car title as collateral? If they do not repay, the lender can take possession of the car and sell it to meet the debt obligation.
Car title loan
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(n) __________ .
Career
Because not everyone has the luxury to pay for small and large items using this, debt allows for the economic engine to flourish.
Cash
It is a very good idea to make sure all correspondence with a collection agency is done by __________ mail.
Certified
This is one of the five C's of credit and is the willingness to pay bills on time.
Character
The five C's of credit are what?
Character, capital, conditions, capacity, collateral
A truly smart shopper, by buying price per quantity, realizes that sometimes it may still be what to buy the larger size and throw a portion of an item out?
Cheaper
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
A specific asset of some value that the borrower pledges to the lender is called what? It can be taken away by the lender and sold to satisfy the debt if the borrower does not pay the loan.
Collateral
What entity buys past due accounts from lenders for pennies on the dollar to then turn around and try to collect the full dollar amount plus penalties and late fees?
Collection agencies
Just as your career is something that you manage, this is something that you manage too. It begins with developing the right attitude.
College career
What job site is specifically designed to match employers with recent college graduates? It is designed specifically for college students and graduates. You can search for entry-level jobs based on your college major or search for internships based on your field of study on this site.
Collegerecruiter.com
What is typically beyond the borrowerÕs control, that could affect the borrowerÕs ability to repay the loan?
Conditions
What type of loan is used quite often and is sometimes confusing?
Consumer
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 r sum is the tool that helps secure an interview, a well written what provides the incentive for a potential employer to read further?
Cover letter
This letter is sent with your r sum for purposes of obtaining a job and/or interview by highlighting their skills, experience and interest.
Cover letter
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.
Credit
The availability of money that has not yet been earned is called what?
Credit
__________ cards provide more protection from fraud and poor business practices than cash.
Credit
_____Êis simply an external indicator of how we handle our financial life. It is an attribute or a characteristic about us.
Credit
What two entirely different concepts do most people use interchangeably, and therefore, incorrectly?
Credit and debt
It is expected that interest rates for what type of loans will be higher than car loans, mortgages, or student loans.
Credit cards
The length of your older accounts is important. You should use your oldest what once in a while?
Credit cards
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
You can equate this as your financial report card or your financial transcript.
Credit report
These may come from different credit reporting agencies and may look somewhat different from each other.
Credit reports
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
This term is the risk score assigned to an individual that indicates their creditworthiness and likelihood to repay a loan.
Credit score
There are many ways to reduce the amount of tax you owe. The two most common methods are using tax deductions and tax what?
Credits
Financing of or raising capital for a business venture, project, or social cause by collecting small amounts of money from many individuals via the internet is referred to as _________.
Crowdfunding
Most people start out with good intentions, then they will charge on the credit card and then they take out loans to get a car and then a house and then furniture for their house. Then they will borrow to take a vacation and buy a pool and next thing you know they have accumulated a lot of ____ Ð and this hurts their score.
Debt
The very first step in one's financial plan is:
Develop their goals
When it comes to finding "quarters in the couch", what is one of the deepest and fullest pockets to begin your search?
Dining out
This document makes you marketable, but does not guarantee a job for you when you graduate. It is nothing more than verification from a trusted third-party that you have acquired certain knowledge and mastered certain skills and that you are now trainable.
Diploma
Fixed expenses, variable expenses, and what is vital to building a simple budget?
Discretionary income
The term for income remaining after taxes and other necessary expenses, otherwise know as your spending money.
Discretionary income
Bad debt has one of three common characteristics; depreciates in value, generates negative financial leverage, and what?
Does not last as long as the term of the debt
This lifestyle force uses variables like salaries, interest rates, and unemployment rates that may be rising, falling or remaining steady.
Economic conditions
What agency partners with multiple consumer protection agencies around the world and helps prevent or stop international scams online?
Econsumer.gov
What are automatic payments withdrawn from your checking account, such as for your monthly mobile phone payment?
Electronic Fund Transfers (ETFs)
What is a retirement benefit plan offered by an employer to its employees at little or no cost to the employees?
Employer sponsored retirement plans
If you want to get into a pharmaceutical sales career track, you may have to sell cars or cell phones for a few years to gain experience. The point is that you are going to have to start at an _________ position to gain experience in order to get to your dream job.
Entry-level
When it comes to non-perishable items, who can save by buying in bulk?
Everyone
What is a guaranteed written or verbal warranty that the vehicle will meet a certain level of quality and reliability or the seller will repair it, replace it, or return the cost to the buyer?
Express warranty
A big disadvantage of home ownership is the equity that builds over time.
False
A credit card loan is usually attached to a specific item purchased.
False
A debt-to-income ratio can easily be calculated from a net worth statement.
False
All banks charge their customers each time they use their automated teller machine (ATM).
False
All laws, rules, and regulations vary from state to state, but marriage never affords ?next-of-kin? status to each spouse
False
All the dangers that come with using credit cards outweigh the benefits and so should be avoided.
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 accountant is usually the least skilled of all tax professionals and usually is the most expensive.
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.
False
Businesses buy things because they like them, not because they can make or save money from them.
False
Car loan payments are rarely the budget buster that most people think they are.
False
Changing from one retirement plan to another is always simple to do.
False
Credit does not help the economy grow.
False
Discount warehouses always save buyers money because bulk items are a good deal.
False
Even by adjusting spending levels, debt cannot be eliminated.
False
Even 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 have great difficulty identifying specific employers for which they would like to work.
False
Everyone understands the difference between the words ÒsavingsÓ and ÒinvestmentsÓ and that they can be used interchangeably.
False
For most people, living on less is easy and is usually done the right way.
False
Good planning for a wedding is always easy.
False
Good reasons for buying a new car include many reasons, but not reduced maintenance, warranty coverage, roadside assistance, or peace of mind.
False
Home owners are viewed by the financial industry as being less stable.
False
How to manage a career is not a financial decision.
False
How to protect loved ones at retirement and death should never be addressed in wills and personal contracts.
False
In general, salespeople advise customers never to spend money on things they did not originally intend to buy.
False
In order for debt to be bad the asset or the thing that is purchased should be something that appreciates in value.
False
Investments may be sheltered from taxes by using any regular savings account.
False
Just as it is a good idea to receive the best price for large infrequently purchased items, it is a good idea to receive the best price for everyday purchases.
False
Just as it is a good idea to receive the best value for large infrequently purchased items, it is a good idea to receive the best value for everyday purchases.
False
Landlords pay property tax, renters do not.
False
Leadership skills are important to only a few employers in just a few fields.
False
Legally, a renter has the upper hand based on what is written on the lease, even when there was a verbal agreement only to conditions such as no penalty if a payment is a couple of days late.
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
Most banks charge a small fee for their own customers to use their automated teller machines (ATM).
False
Most checking accounts operate in very different ways.
False
Most credit unions and many banks do not offer free checking even if direct deposit is used.
False
Most people do a very good job of making a wise car purchase.
False
Net worth is not the difference between assets and liabilities or the difference between what is owned and what is owed.
False
New credit represents 20% of a credit score.
False
One great feature of tax preparation forms from the IRS is they provide the ability to accurately estimate next yearÕs tax liability.
False
Only one financial calculator is available to use in time value of money calculations.
False
Sending just a resume without a cover letter when applying for a job is always appreciated by recruiters as they are busy and know the job you are applying for.
False
State birth tax, for those states that have this tax, requires that parents to pay a certain percentage of all wealth that is to be transferred as part of an inheritance.
False
Tax preparation software applications, such as TurboTax or TaxAct, should be avoided.
False
The Independent Insurance Agents and Brokers of America organization provides insurance to the well to do.
False
The difficulty in using credit provided by credit cards makes it harder to overspend.
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 present value of an annuity calculates how much a regular series of payments will be worth at some point in the future.
False
The primary disadvantage of buying a new car is lower maintenance costs and peace of mind.
False
The purpose of the resume is to get a job.
False
The three ÒWÓs of career management are what, where, and why.
False
There is no such thing as good debt or bad debt, all debt is bad.
False
To decide whether to be saving or investing, simply look at whether it is a bank or a credit union.
False
Understanding the affect taxes have on purchasing decisions is not important to reaching personal financial goals.
False
Unlike renter?s insurance, homeowner?s insurance covers personal property, provides liability protection, and pays for other expenses.
False
When beginning to invest it is usually best to avoid simple investments as they generally don't make you any money.
False
You can't distinguish a home buyerÕs market from a sellerÕs market by looking at the average listing time of homes for sale in the market.
False
The mission of the ____________ is to prevent business practices that are anticompetitive, deceptive, or unfair to the consumer.
Federal Trade Commission (FTC)
Not knowing the details of how your debit card works can cost you a lot in ____ over the long run.
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.
Fees
This term describes the duty and responsibility to manage another personÕs money and assets in a responsible and ethical way.
Fiduciary
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?
File a lawsuit
More recently, however, many other industries have discovered that people with messy _______ lives, as indicated by a poor credit score, tend to lead messy lives. Think of it from the employer's standpoint. If you can't take care of your own money, how can you take care of theirs?
Financial
What is it called when you use debt to purchase an asset?
Financial leverage
Credit reports are like report cards or your transcript about your ________.
Financial life
What industry traditionally used your credit reports and credit score to determine if you qualified for a loan and, if so, what the terms of the loan would be?
Financial services industry
The best way for people to find more money is:
Find money that is already there
What term is short for financial technology? It is considered disruptive technology, meaning that it significantly changes the way you bank.
Fintech
If you check your credit report and find accounts that were handled in bankruptcy but still show up as unpaid, you should get them _____.
Fixed
What expenses include rent, car payment, car insurance, student loan payment, and anything else that is obligated or under contract where the payment is the same each month?
Fixed expenses
What is the term for expenses that are the same amount and due each month?
Fixed expenses
What is a non-refundable federal tax credit for income taxes paid to a foreign country as part of foreign income taxes withheld?
Foreign Tax Credit
The SEC is concerned primarily with promoting the disclosure of important market-related information, maintaining fair dealing, and protecting against what?
Fraud
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
Your budget lets you project what, along with expenses, so that you can align your budget sheet to your S.M.A.R.T. goals?
Future income
Practicing time value of money in Excel and on the calculator will help you to better understand these key time value of money concepts: present value of a lump sum, interest rate of a lump sum, investment time period of a lump sum, and what?
Future value of a lump sum
Bad debt has one of three common characteristics; depreciates in value, does not last as long as the term of the debt, and what?
Generates negative financial leverage
Your credit score will go ______, if you cancel an old credit card, which will make your credit utilization go up.
Go down
Setting these are the first step to achieving personal financial success.
Goals
The real key to successful saving and investing is to match financial __________ to the right types of savings and investing accounts.
Goals
When starting out on your independent financial journey, you should focus on what?
Goals
What is the term describing a guarantee that you can renew an insurance policy at the end of its term regardless of your circumstances, as long as the premiums are paid?
Guaranteed renewability
What is the term for a person who is legally responsible with the rights and responsibilities of caring for another individual, usually one who is underage or legally incapable of managing their own affairs?
Guardian
In order for the individual that you designate to advocate on your behalf, they need to be able to: understand information about any treatment options for you, keep in mind your wishes, and what final understanding?
Handle the stress of making those decisions
When it comes to taxes, the five filing statuses identified by the IRS are single, qualifying widow(er) with dependent child, married filing jointly, married filing separately, and what final filing status?
Head of household
What document gives you the legal authority to make healthcare decisions on your parentsÕ behalf?
Healthcare proxy
The key to credit cards is to understand the consumer protections laws governing credit cards, when you should and should not use them, the purpose they should serve, and what?
How they work
This term is used for receiving money in exchange for work or through investments.
Income
What is the term for the easiest portion to complete in your budget worksheet which typically stay the same from month to month?
Income
What is the tax levied by a government directly on income, especially an annual tax on personal income?
Income tax
What is the term describing the rate of increase in the price for goods and services?
Inflation
What is the term for the natural increase in the price of goods and services?
Inflation
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?
Installment loan
A basic understanding of how insurance companies work is important so that you understand how to maximize your protections and reduce your what?
Insurance costs
Because the federal government wants taxpayers to own homes, the tax code allows homeowners to deduct what portion of their mortgage payment from their taxable income?
Interest
This federal agency is even powerful enough that they can garnish wages and seize the bank accounts, retirement accounts, house, car, or boat of someone who owes taxes, and sell the property to satisfy their tax debt.
Internal Revenue Service (IRS)
What is the federal government agency that enforces and administers the federal tax laws?
Internal Revenue Service (IRS)
If you are a new customer, credit card companies will sometimes offer a special lower interest rate, also known as what kind of rate?
Introductory Rate
After your savings plan is in place and your emergency fund is fully funded, where can you now turn your attention?
Investing
How do you achieve your long-term goals and objectives, such as your retirement or your kidÕs college?
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
To be paid for a position or work task completed in exchange for pay is what?
Job
This term describes when two or more people own a piece of property.
Joint Ownership of Real Estate
Why do financial plans still fail? It can be summed up in one simple phrase. What happens?
L.I.F.E.
It is called a career __________, not a career escalator.
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?
Ladder
What will companies do when the employees no longer add value and begin to cost the employer?
Lay off
What is the key to saving?
Learn to live on less
The home loan officer runs numbers based on maximum limits and standard formulas, and then determines the most they are willing to what?
Lend
You must have credit that is reported for at least six months to even have a credit score. This looks at the time between when you opened your accounts and when you last had activity on them. To what is this giving an insight?
Length of history
These are factors that influence how a person chooses to live such as marriage and career choice. Some factors may be outside an individuals control such as age and economic conditions.
Lifestyle choices
In the process of paying down debt, what is it important to list before you create a payment plan?
List all of your debts
The proper order to eliminate debt is:
List one's debts, establish an emergency fund, arrange debts in order, pay off first debt, pay off next debt adding previous debt payments to minimum, etc.
It is human nature to compare ourselves with those who are better off. This can lead to bad spending habits, and going into debt, which is why it is recommended to do what?
Live within your means
This trust type can avoid probate and the details can be kept private and simply means the trust is in place during the grantorÕs lifetime, also called an "inter-vivos" trust.
Living trust
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 longer time period, usually 3 months or more?
Long-term Disability Coverage
What is the first step a person should take when searching for a place to rent?
Look at their budget
It's recommended to review your tax situation in order to avoid the ÒApril 15th surpriseÓ when these events occur: graduation, marriage, divorce, having a baby, adopting a child, significantly reducing or increasing your income, changing jobs, and receiving an inheritance. What are these events called?
Major life events
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
What is the rate of tax placed on each additional dollar of income?
Marginal tax
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, married filing jointly, qualifying widow(er) with dependent child, and what final filing status?
Married filing separately
What is the term for the combined state and federal program that provides health coverage for low income individuals?
Medicaid
Between your ______ and your network you should not lack for someone to turn to for advice or help.
Mentor
LetÕs define our three classes of earners as upper class, lower class, and what final class?
Middle class
As you are beginning to payoff your first debt with everything you can, what should you be paying on the remaining others?
Minimum payment
Banks use depositorsÕ money in a __________ market account to invest in government and corporate investments.
Money
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?
Money market funds
Some institutions require a minimum balance in your checking/savings account or you will be subject to fees. When are these fees typically applied?
Monthly
When creating an expected budget, what should you list first?
Monthly income
What should come off of your credit report automatically after seven years?
Negative items
When it comes time to file taxes a person's goal should be to what?
Neither owe money nor receive a large refund
This is nothing more than the difference between your assets and your liabilities, or the difference between what you own and what you owe.
Net worth
___________ is the difference between assets and liabilities or the difference between what is owned and what is owed.
Net worth
This term refers to the number of new accounts you have and how many times you recently asked for credit.
New credit
This lifestyle force considers you may be caring for children, aging parents, adult children, children with disabilities, etc.
Number of dependents
Where should you begin reviewing car inventories first before physically visiting any dealerÕs lot?
Online
Better interest rates, ease of use, and quicker rollout of new technologies are just three reasons to use ____________.
Online banks
These are virtual banks and are becoming increasingly popular. The consensus is that, without the expense of brick and mortar buildings, they can offer more favorable interest rates whether you are depositing money in a savings account or borrowing money to purchase a new car.
Online-only
All of the following are good goals for most people except which?
Open a home equity line
You can never tell from where lucrative job offers might come. What should you take full advantage of during your college career?
Opportunities
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
Even though debt sometimes comes with zero percent interest, it is still debt because by definition the money is still what?
Owed
___________ loans are some of the most dangerous and expensive loans available.
Payday
What distinguishes an annuity from a lump sum?
Payment
This term includes past due items, how long they are past due, and any delinquencies or judgments that are a result of paying late or simply never paying at all.
Payment history
What must your r sum and e-mail be before you hit send?
Perfect
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. ItÕs not about having more money. It is about managing what you earn and using your money to reach your goals.
Personal finances
What is a tax levied on an individual's personal property by the county or state in which they reside?
Personal property tax
By not understanding the basic concept of the time value of money (TVM) people make __________ financial decisions all the time.
Poor
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 attorney
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.
Prepaid debit cards
This is a financial tool where you can have money direct-deposited onto some of them, access an ATM to withdraw cash, and use them to make purchases, as if there were traditional debit or credit cards. What financial tool is this?
Prepaid debit cards
We face many risks. Not fully inclusive, the list includes: disability, illness, death, financial, identity theft, liability, and what other form of risk?
Property
What is the category of risk where no profits are possible, but only total loss, partial loss, or break-even are the only possible outcomes?
Pure risk
In the long run, proving you can handle different types of credit will ultimately do what to your score and will establish you as a less risky consumer?
Raise
Potential employers are looking for you to demonstrate what kind of examples of how you have acquired certain qualities the employer finds important?
Real-life
At the very least, as you begin to pay off your credit cards, what should you never do even as the minimum required payment amount decreases?
Reduce your monthly payment
The "April surprisesÓ to avoid are either owing a large tax liability because not enough taxes were withheld, or receiving a large tax __________ because too much tax money was withheld.
Refund
For almost all college students and anyone early in their career, what is it better to do in order to be flexible enough to take a new job elsewhere?
Rent
A __________ is a critical document for anyone seeking a new job.
Resume
The longer the time horizon for your investment, the higher the gains you will want. The more time you have, the less up-front investment it will require to achieve your goal. That is true only if you earn an appropriate what?
Return
This is the term for the add-on provision to an insurance policy that increases coverage beyond standard items or amounts.
Rider
Eventually some potential borrowers can get to the point that they present so much ____ that no lender will loan them anything at all.
Risk
Savvy investors avoid unnecessary __________.
Risk
__________ can be managed in a variety of ways.
Risk
This is the term for the amount of volatility (increase and decrease) an investor is willing to endure in relation to the value of their investments.
Risk tolerance
Robert is renting his first apartment. He did a very good job of determining what he could afford by looking at his budget and finding an apartment close to where he works. He completed a walk-through with the landlord and reviewed the entire lease for completeness and reasonableness. He spent the last weekend moving in and hanging pictures on the walls. What final step has Robert neglected?
Robert has neglected to purchase renter's insurance
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's resume and cover letter were better
What can you use to get a simple estimate of how long it will take to double an investment?
Rule of 72
Homeownership is the American dream, but it does not come cheap. There are many advantages to owning a home, but it can send shockwaves through your financial plan if not done right. Setting _________ goals, will help you avoid financial tremors.
S.M.A.R.T.
What is a tax from a state or city on the sales of a product or service, generally collected by the retailer?
Sales tax
The question is not IF something you own will break, but WHEN. So you don't break the bank or borrow money every time something unexpected happens, it's important to put money aside. What is this proactive approach referred to?
Save for emergencies
Where can you find summarized credit card information and key points of the contract, including the annual fee, interest rate, grace period, and other fees?
Schumer box
Checking accounts, certificates of deposit, bonds, and money market accounts are best used for:
Short-term saving goals
Budget sheets with monthly __________ indicate it is time to make adjustments in spending habits.
Shortages
Unlike with a tangible product, what can you not do with a purchased service such as a bad haircut or a sloppy roof repair?
Simple return
Tax preparation software:
Simply asks a series of questions that can easily be answered
What job site is one of the few sites designed specifically for hourly jobs? If your goal is not necessarily to start out in management or in a salaried position, then this job site may be a good alternative.
Snagjob.com
While a used car purchase is less expensive, what else do you risk buying along with the car?
Someone else's problems
Insurance is:
Something many people make a poor decision about when buying
Funds with specialized investment goals are called what?
Specialty funds
What is a fixed amount of money you can deduct from your taxable income, based on filing status and age?
Standard deduction
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?
Step 4
What is the physical or electronic market that brings buyers and sellers together to buy and sell financial instruments?
Stock market
What should your r sum emphasize as it relates to the requirements of the job?
Strengths
What kind of loans should be used only for educational expenses? Using your financial aid to finance your spring break or help make car payments leads to graduating with more student loan debt than is necessary or advisable.
Student financial aid
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?
Successful
What is the term for income received from employer after all taxes and other deductions?
Take home pay
What is a tax imposed on imported goods and services?
Tariff
Although rarely thought of this way, for most people their __________ burden is actually their largest annual household expense.
Tax
What is the term for a range of income taxed at a particular rate?
Tax bracket
This is the term for tax deductions that reduce taxable income and the value depends on the taxpayerÕs marginal tax rate, which rises with income.
Tax deduction
What term reduces the amount of your income that is subject to taxation?
Tax deductions
What is the interest rate percent of income paid as taxes?
Tax rate
This it the term for the amount of income used to calculate taxes owed; the gross income minus eligible deductions.
Taxable income
This type of trust is created under your Last Will and Testament and can only be implemented upon your death and since it is not established until your death, it still has to go through probate.
Testamentary Trust
Every credit card application has a box that summarizes:
The annual fee, the interest rate, the grace period
What is a debt utilization ratio?
The ratio of incurred or actual debt to total debt limit.
Which of the following is true?
There is nothing wrong with spending money if a person learns to spend the right way
What happens when a person uses a debit card?
They are only using money they have already earned
Generally, when there are more homes available for sale than the number of interested and qualified buyers:
This is a buyer's market
If you have solved for PV, FV, and Rate, what is the only thing left to solve for a lump sum amount?
Time
Investments should make investors wealthier over __________.
Time
The four ÒWÓs in your job search are relatively easy questions to ask, but take this to answer.
Time
Sometimes you may have to decide if it is better to make a one-time large investment or regular smaller investments over the same what?
Time period
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)
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
The only money you have available is your discretionary income, so think about expenses in terms of percentage of monthly discretionary income, not the percentage of what?
Total income
You just bought a car at a fair and reasonable price. The next step is to discuss financing and what?
Trade-in values
A Roth individual retirement account (IRA) is different from a traditional IRA in that it does not provide immediate tax deferral like the traditional IRA does.
True
A budget sheet is easily customized so that it makes the most sense for each individual.
True
A certificate of deposit (CD) may be a viable savings option if access to the money is not needed for the length of the CD.
True
A credit card application is a contract.
True
A person can have a negative net worth.
True
A renter should make sure all relevant information is clearly represented on a lease, such as costs, dates, and penalties.
True
A resume is a critical document for anyone seeking a new job.
True
A retail loan is usually unsecured or attached to a specific item purchased, but is offered by either a retail store or a third-party finance company.
True
A will is a necessity for most parents with young children because it is the best way to assign guardianship.
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
According to studies more than 75% of respondents know that their savings, specifically for retirement, are inadequate.
True
All states have lemon laws that apply to new cars.
True
Almost every employer offers professional development courses or workshops on improving communication skills.
True
Although most people want to make a financial rather than an emotional decision when buying a car, determining the best car is a balance between wants and needs for each individual.
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.
True
Any time a major life event occurs a review of one's tax situation is in order to avoid an ÒApril 15th Surprise.Ó
True
Arriving at a job interview late adds stress to an already stressful situation.
True
At first, it may appear counterintuitive to be upset about receiving a large tax refund, but large refunds as well as large tax bills are signs of poor income tax management.
True
Businesses only spend money on things that make them money or add value to the company.
True
Businesses use credit to invest, expand, and hire employees.
True
Buying a new or used car is just one of many decisions faced in the car buying process.
True
By buying quality and extending the productÕs lifetime a product's value is increased.
True
Car loans usually should usually last five years or less.
True
Changing from one retirement plan to another can get very tricky.
True
Completing a degree in the field of a dream job has no impact on the chances of getting the next job on that dream career path.
True
Compounding is the power behind the time value of money.
True
Credit helps an economy grow as consumers can spend money on large purchases that help keep businesses running.
True
Credit reports are like report cards about a person's professional life.
True
Credit unions are insured by another federal government entity called the National Credit Union Administration.
True
Discount warehouses can save buyers a lot of money if they are careful, but not all bulk items are a good deal.
True
EveryoneÕs tolerance for risk is unique to them.
True
FDIC is short for the Federal Deposit Insurance Corporation.
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
How careers are managed is one of the biggest financial decisions most people make.
True
If a 10-year-old car worth $2,500 is wrecked and it costs $4,000 to fix the car, the insurance company will reimburse the owner up to $2,500 and consider the car ?totaled.
True
In general, risk is the probability or likelihood of an unfavorable event occurring.
True
Information gathered for credit reports come from credit and banking agencies voluntarily reporting information about credit habits to credit reporting agencies.
True
Insurance should not be used to smooth out all the little bumps of life.
True
It is easier than ever for most people to do their own taxes.
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
Most people are familiar with sales tax because 45 states plus the District of Columbia have some type of sales tax on purchases.
True
One of the easiest ways to begin saving is by setting aside a small amount of each paycheck into some type of savings account each pay period or month.
True
Over the long run prudent financial planning will slowly eliminate the need for life insurance.
True
Payday loans are some of the most dangerous and expensive loans available.
True
Preparing for a job interview is like cramming for an exam.
True
Pure risk is accidental or unintentional in nature.
True
Spending is what many people do when they are feeling down or depressed.
True
State inheritance tax, for those states that have this tax, requires that an estate pay a certain percentage of all wealth that is transferred as part of an inheritance.
True
Talking about money can be the best area of communication in a relationship.
True
The credit card industry is extremely competitive.
True
The five Cs of credit take into account both the willingness and the ability to repay a loan.
True
The five CÕs of credit are character, capacity, capital, collateral, and conditions.
True
The longer the investment horizon, the greater the level of risk that can be accepted.
True
The real key to successful saving and investing is to match financial goals to the right types of savings and investing accounts.
True
The three ÒWÓs of career management provide a lens through which to view a career plan.
True
The type of investment selected should be linked to time horizon of the financial goal.
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
Wealth is taxed at both the state and federal levels primarily through inheritance taxes.
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.
True
When Ira borrows money to buy new living room furniture he has immediately bought an item that depreciates in value.
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
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
Evaluating how risky you are as a borrower, deciding if, and how much, they will lend the borrower, and determine the interest rate; this is the process lending institutions go through when they are doing what?
Underwriting
This term describes a group of people whose income is above 75% of all income earners.
Upper class
The term for a mortgage loan that is guaranteed by the Department of VeteranÕs Affairs for active duty military, veterans, and reservists to buy a home.
Veteran's Administration (VA) Loan
People should purchase a home:
When the net worth statement, budget, and money personality align
The key to credit cards is to understand the consumer protections laws governing credit cards, how they work, the purpose they should serve, and what?
When you should and should not use them
Once you have prioritized your first three "W"s you can move on to the fourth. This question is a critical one because it helps you see the big picture and think longer term and not just get caught up too much in short-term thinking. What is the final "W"?
Where do you want to be five years after graduation?
Begin to identify specific companies where you can apply for a job after graduation. Since you know these companies already have jobs you will like and they are located in a place you want to live, you can concentrate on determining which ones will be the best fit for you. What "W" are you beginning to address?
Who do you want to do it for?
Many savings accounts typically limit the number of these to usually three to six per month.
Withdrawls
No one else will move you along in your career like __________ will.
You
Who is the number one advocate for your own financial protection?
You
Regardless of how much the car dealer pressures you, never raise your own offer before they have given you a counter offer, otherwise you are negotiating against who?
Yourself
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
