When you set financial goals, they should be. . .

Specific, measurable, time-sensitive, yours, and written.

Savers have a tendency to be. . .

Strict with their money and not spend any of it.

Franklin D. Roosevelt passed the New Deal because of the Great Depression in 1930s. What's the purpose of this program?

To promote economic recovery and social reform

After World War I, the demand for products increased & people began getting credit without loan sharks because credit

Started to become more socially acceptable

In 1972, what association made borrowing money to attend college much easier than it had been?

The Student Loan Marketing Association (SLMA)

What is Financial Literacy?

Knowledge/skills needed for people to be informed consumers & mange their $

Making the right choices with your money-managing your money-involves knowing how. . . .

Earning, budgeting, saving, spending, and giving affect your money.

What does living paycheck to paycheck mean?

When a person's income is devoted to expenses leaving little to no money.

What is the best way to avoid running out of money too quickly?

Make it a habit to plan and set goals for your money.

To gain an understanding of your personal finances, you should know. . . .

Where you stand financially, how much $ you have, set goals & reach them.

What are The Five Foundations?

A personal financial action plan

As a single adult, you should. . . .

Keep managing your money as a priority

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Ramsey Classroom Chapter 1 Review

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Questions 30

Answers

1
Using credit has not always been a socially accepted practice, but it has become. . .
A practice used by the wealthy.
Normal in American culture.
Less acceptable
Necessary for life in America
2
When you set financial goals, they should be. . .
Only time-sensitive
Timely, bank-based, specific, and yours
Specific, measurable, time-sensitive, yours, and written.
Specific and measurable
3
Savers have a tendency to be. . .
Strict with their purchases but spend monety without a plan
Strict with their money and not spend any of it.
Strict with what they spend their money on, other than groceries
Strict with only purchases for themselves
4
Personal finance is all the financial decisions a(n)___must make in order to earn, budget, save, spend, and give money.
Bank
Individual or company
Individual or family
Company or organization
5
Franklin D. Roosevelt passed the New Deal because of the Great Depression in 1930s. What's the purpose of this program?
To alleviate financial concerns with the United Nations
To promote economic recovery and social reform
To create a borrowing system within the country.
To divide the national budget in half and distribute it.
6
Your money personality impacts. . . .
Your understanding of bank transactions
What you plan for as an adult.
Your financial literacy level
How you handle money
7
What is The First Foundation?
Save a $500 emergency fund
Build wealth and give
Open a Checking Account
Pay cash for college
8
A ____ financial goal takes up to two years to reach.
Five-level
Short-Term
Medium-Term
Long-Term
9
You should always make sure you have a. . .
Budget
Credit Line
Direct Deposit
Credit Card
10
Personal finance is 20% _____ and 80% _____.
Reactions; behaviors
Behavior; head knowledge
Head knowledge; behavior
Cause; effect
11
It is possible to pay for college with cash.
True
False
12
You are either a natural saver or a natural spender. You cannot have a balance of both.
False
True
13
An important money principle to consider is that you should ____ and ____ your money.
invest; lay out
Save; invest
invest; endow
spend; invest
14
Without any debt, you can be outrageously ______.
Generous
Cautious
Thrifty
Selfish
15
Avoiding debt can lead to financial freedom and hope.
False
True
16
Banks got into the credit business before 1920 because charging exceptionally high interest rates was legal.
False
True
17
After World War I, the demand for products increased & people began getting credit without loan sharks because credit
Was offered at even higher interest rates by loan sharks
Started to become more socially acceptable
Was devalued in the marketplace
Increased so rapidly, loan sharks became obsolete
18
In 1972, what association made borrowing money to attend college much easier than it had been?
The Federal Student Approval Association (FSAA)
The Student Loan Approval Association (SLAA)
The Student Loan Marketing Association (SLMA)
The Student Federal Funding Association (SFFA)
19
To know your net worth, subtract your liabilities from your ------.
Previous Net Worth
Other liabilities
Assets
Net Income
20
What is Financial Literacy?
The curriculum provided to college students about finances for their degree
The content provided in bank statements for consumers.
The skills to read financial documents for personal finance classes & goals
Knowledge/skills needed for people to be informed consumers & mange their $
21
Making the right choices with your money-managing your money-involves knowing how. . . .
Earning, budgeting, saving, spending, and giving affect your money.
to make bank deposits using registers with the appropriate transactions
Planning, Saving, Spending, & investing will define your financial profile
Consumer decisions will affect your accounts
22
What does living paycheck to paycheck mean?
A person who can't plan past the next paycheck due to $$ & budgeting issues
A description of one who awaits their next paycheck to plan for expenses.
When a person's income is devoted to expenses leaving little to no money.
When one chooses not to deposit their paycheck, they are living PC to PC.
23
Being a spender has many more positives than being a saver.
True
False
24
What is the best way to avoid running out of money too quickly?
Avoid making any purchases for the next 30 days.
You can invest in college.
Put your money in a safe place, like a bank, and not spend it.
Make it a habit to plan and set goals for your money.
25
To gain an understanding of your personal finances, you should know. . . .
Your financial goals
Your investment portfolio and your financial advisors' contact information
Where you stand financially, how much $ you have, set goals & reach them.
How much income you have
26
If your assets total more than your liabilities, you will have a(n) _____ net worth.
Negative
Positive
Unknown
Equal
27
What are The Five Foundations?
A personal financial action plan
A common conclusion for debt.
A starting point for adults regarding finances
A financial literacy technique
28
As a single adult, you should. . . .
Keep managing your money as a priority
Seek a financial counselor or advisor by age 25
Beware of planned and budgeted buying
Have an accountability partner you trust somewhat
29
What is The Fifth Foundation?
Pay cash for your car.
Build wealth and give.
Get out and stay out of debt.
Find a financial professional
30
A money principle to keep in mind is to live on _____ you make.
Exactly 20% below what
The same as
More than
Less Than

Ramsey Classroom Chapter 1 Review Flashcards | StudBud