Mastering Personal Finance Flashcards

1

True or false: budgeting is unnecessary for everyone.

True
False

2

What is compound interest?

Interest on interest earned
Fixed interest rate
Interest on principal only
Simple interest calculation

3

True or false: credit cards always help your credit score.

False
True

4

Which is a sign of financial health?

No savings at all
High debt-to-income ratio
Living paycheck to paycheck
Emergency fund saved

5

What is a credit score?

A measure of income
A measure of creditworthiness
A measure of savings
A measure of debt

6

True or false: all debts are bad debts.

False
True

7

What does diversification mean?

Focusing on stocks only
Spreading investments across assets
Investing in bonds only
Investing in one asset

8

Which is a common retirement account?

Money market account
401(k)
Checking account
Health savings account

9

Which is a fixed expense?

Rent
Clothing
Entertainment
Groceries

10

Which investment is considered high risk?

Bonds
Savings account
Cryptocurrency
Real estate

11

Which is a good saving habit?

Ignoring savings
Only saving when possible
Saving a portion regularly
Spending all income

12

True or false: you should always pay off debt first.

False
True

13

True or false: saving is more important than investing.

True
False

14

What is a common budgeting method?

50/30/20 rule
Envelope system
Cash flow analysis
Zero-sum budgeting

15

Which is a benefit of investing early?

More time to grow
Higher fees
Less risk
Guaranteed returns

16

What is an emergency fund?

Savings for emergencies
Retirement savings
Money for vacations
Investment fund

17

What is a financial goal?

A wish for money
A debt to pay
A random number
A plan for savings

18

True or false: financial literacy is only for adults.

False
True

Mastering Personal Finance

Questions 18

Mastering Personal Finance

Questions 18