CPF Chapter 3 Study Guide

45% of Americans have less than $1000 saved for

Emergency Fund

An investment's _________ is its percentage of gain or loss over time

rate of return

________ is the average rate of growth for an investment over a period of time

Compound Growth

The price of goods and services increases over time due to_______

Inflation

The initial amount of money you deposit or invest is called the______

principal

You save for a(n)________ when you don't have the cash to buy it now

Large purchases

_________deals- such as 90-days-same-as-cash--are often used to get you to buy higher-priced items

Interest rate

The_______refers to the earning potential of money

time value of money

A great principle for saving money is "Stat paying yourself and

plan ahead to get ahead

The First Foundation is:

Save $500 emergency fund

If you make a late credit payment you might see the lender add

interest so you have to pay more.

The three reasons to save money are

emergencies, large purchases, and wealth building.

What is considered an emergency fund expense

Lost cell phone

"Rate of return" is a phrase used to describe what aspect of investing

Compound growth

What is the Third Foundation

Pay cash for your car

When you make a purchase but wish you hadn't done so; you experience:

Buyer's remorse

What three questions can help determine if something requires the use of the emergency fund?

Is it urgent?, Is it necessary? Is it unexpected?

What two elements do you need to build wealth through compound growth?

Money invested and time.

What causes you to have money is you_______some of it.

kept

Morphy's law:

if it can go wrong, it will.

Saving is______a part of your budget

always

Nearly 8 out of 10 families live

paycheck to paycheck

You will have a financial_______at some point in your life

emergency

The first reason to save money is to build your_______fund

emergency

The second reason to save money is for_______purchases

large

The third reason to save money is for_______building

wealth

Start saving while you're______?

young

Money come from_______?

work

An emergency fund turns a crisis into an________?

inconvenience

If you invested $_______ per month in mutual funds from age 25 to 65 you could have $3.6 million in a mutual fund.

554

$100________per month from age 25 to 65 at 11% interest is 1 176.00

invested

48% of Americans have less then $10000 saved for_______?

Retirement

Self-discipline will lead to a high________of life.

quality

The power of__________interest says to get started as soon as you can.

Compound

What percentage of Americans have $0 saved?

14%

Debt steals your future

but saving secures your future.

What percentage of millionaires said they live on less than they make?

94%

What percentage of millionaires say they plan and save in advance for big expenses?

95%

67% of the general population never plan on doing what in the future?

Saving for a big expense.

True or Fales: 94% of students who complete this course feel much more confident in being able to save money.

True

True or False: One out of every three Americans experienced a job loss or income disruption during the COVID-19 pandemic.

True

What percentage of Americans said they would be unable to cover a $400 emergency.

39%

What percentage of Americans have $0 saved for retirement.

25%