Master the Art of Saving
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Questions and Answers

What is the recommended amount of money to have in your emergency fund?

  • 7-9 months of fixed expenses
  • 10-12 months of fixed expenses
  • 1-2 months of fixed expenses
  • 3-6 months of fixed expenses (correct)

    • What is the purpose of setting up 'overdraft protection' against your checking account or credit card?

  • To earn competitive interest rates
  • To prevent accidental check bouncing or withdrawal (correct)
  • To avoid paying monthly fees
  • To transact easily back-and-forth

    • What factors should be considered when determining the size of your emergency fund?

  • Number of years until retirement
  • Amount of money saved in a 401k
  • Number of credit cards owned
  • Amount of liquid assets and fixed monthly expenses (correct)

    • Which of the following is a reason why some people prefer to have their savings account at a separate institution?

    <p>They feel that their savings is less accessible</p> Signup and view all the answers

    What is the benefit of using multiple accounts for different purposes?

    <p>It helps you keep track of your different financial goals</p> Signup and view all the answers

    When might CDs be a suitable option for saving?

    <p>When you have additional savings for future use</p> Signup and view all the answers

    What is compound interest?

    <p>Interest that is calculated on the balance</p> Signup and view all the answers

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