12 Questions
What is the recommended amount of your paycheck to put into savings?
20%
What is the purpose of an emergency fund?
To cover unexpected life events
What distinguishes credit unions from commercial banks?
Non-profit nature and high loan rates
How do online-only institutions differ from traditional banks?
Higher interest rates
What is the concept of 'pay yourself first' in money management?
Putting money into savings before spending on bills
Which type of depository institution aims to make a profit?
Commercial banks
What is the purpose of the FDIC and NCUA?
To provide protection to financial accounts in case of a bank or credit union failure
What is the key characteristic of a savings account?
Safe and reliable for short-term cash storage
What is the main difference between electronic payments and writing a check?
Checks involve physically writing an order to the bank, while electronic payments are done online
What feature distinguishes Money Market Accounts (MMAs) from other accounts like savings accounts?
MMAs have variable interest rates and require a minimum balance
What is the primary characteristic of a Certificate of Deposit (CD) compared to savings accounts?
CDs lock in money for a fixed period with penalties for early withdrawal
What is the key motivation for individuals to invest in Certificates of Deposit (CDs) rather than traditional savings accounts?
Higher interest rates on CDs as an incentive for lost liquidity
Learn about the importance of savings, recommended amount to save, 'pay yourself first' concept, interest, and building an emergency fund. Discover how to manage money efficiently and secure your financial future.
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