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*Financial Literacy - Ch 1 - Introduction to Personal Finance Flashcards | StudBud
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*Financial Literacy - Ch 1 - Introduction to Personal Finance
*Financial Literacy - Ch 1 - Introduction to Personal Finance
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New Ramsey Classroom curriculum
Flashcards
36 cards
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Practice quiz
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Host live
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Questions
36
Answers
1
Which one is NOT one of the 5 Foundations?
Pay Cash for College
Save Up a $500 Emergency Fund
Give Money to Your Friends
Get Out of Debt and Stay Out of Debt
2
What is The Fifth Foundation?
Build wealth and give
Pay cash for your car
Get out and stay out of debt
Fina a financial professional
3
A short-term financial goal is investing for your retirement.
True
False
4
What are The Five Foundations?
A starting point for adults regarding finances
a Financial Literacy Technique
A common conclusion for debt
A personal financial action plan
5
It is possible to pay for college with cash.
True
False
6
Financial Literacy is
the possession of skills that allows people to make smart decisions with their money
.
True
False
7
Personal Finance is dependant on your behavior because even though you know the plan, you have to control your spending
False
True
8
Savers have a tendency to be . . .
Strict with money and not spend any of it.
Strict with purchases but spend money without a plan
Strict with what they spend their money on, other than groceries
Strict with purchases for only themselves
9
If your assets total more than your liabilities, you will have a(n) _____ net worth.
Unknown
Positive
Negative
Equal
10
A money principle to keep in mind is to live on _______ you make.
less than
the same as
more than
exactly 20% below what you make
11
What is the best way to avoid running out of money too quickly?
You can put your money in a safe place, like a bank, and not spend it.
You can make it a habit to plan and set goals for your money
You can invest in college
You can avoid making any purchases for the next 30 days
12
FDR( Roosevelt) passed the New Deal because of the Great Depression in the 1930s. What was the purpose of this program?
To promote economic recovery and social reform
To alleviate financial concerns with the United Nations
To divide the national budget in half and distribute it
To create a borrowing system within the country
13
What does living paycheck to paycheck mean?
A person's income is devoted to expenses, little to no$ put into savings.
When a person chooses not to deposit their paycheck.
A situation when you eagerly await the next paycheck to plan for expenses
Not being able to plan past the next payck due to outside circumstances
14
Without any debt, you can be outrageously _______.
Generous
Cautious
Selfish
Thrifty
15
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 appropriate transactions listed
Consumer decisions will affect your account
Planning, saving, spending and investing will define your portfolio
16
Personal finance is 20% _______ and 80% _______
Reactions; behaviors
Behavior; head knowledge
cause; effect
Head knowledge; behavior
17
In 1972, what association made borrowing money to attend college much easier than it had been?
Student Loan Marketing Assoc (SLMA)
Student Federal Funding Association (SFFA)
Federal Loan Approval Association (FLAA)
Student Loan Approval ASsociation (SLAA)
18
Using credit has not always been a socially accepted practice, but it has become . . .
Normal in American culture
Necessary for life in AMerica
Less Acceptable
A practice used by the wealthy
19
When you set financial goals, they should be . . .
Only time-sensitive
Specific and measurable
Timely, bank-based, specific and yours
Specific, measurable, time-sensitive, yours and written
20
Your money personality impacts . . .
How you handle money
Your understanding of bank transactions
Your financial literacy level
What you plan for as an adult
21
Knowing if you are a spender or a saver is important so you learn to control behaviors to make smart decisions.
False
True
22
Personal finance is all the financial decisions a(n) _______ must make in order to earn, budget, save, spend, and give.
Company or organization
Individual or Company
Individual or family
Bank
23
What is financial literacy?
The content provided in bank statements for consumers
The skills to read financial docs for finance classes, goals and statements
The knowledge + skill base for consumers to manage finances effectively
The curriculum provided to college students about finances
24
Banks got into the credit business before 1920 because charging exceptionally high interest was LEGAL
True
FALSE
25
To gain an understanding of your personal finances, you should know . . .
How much income you have
Your financial goals
Your investment portfolio and your financial advisors contact info
Where you stand financially, how much $ you have, goals & how to reach them
26
After World War I, demand for products increased, people began getting credit without loan sharks. Due to this, credit…
Increased so rapidly, loan sharks became obsolete
Was offered at even higher interest rates by loan sharks
Started to become more socially acceptable
Was devalued in the marketplace
27
As a single adult, you should . . .
Beware of planned and budgeted buying
Keep managing your money as a priority
Never seek financial advice from others
Seek a financial couselor by the age of 25
28
Avoiding debt can lead to financial freedom and hope.
True
False
29
You are either only a natural saver or a natural spender. You cannot have a balance of both.
True
False
30
What is the FIRST Foundation?
Save a $500 Emergency Fund
Open a Checking Account
Build wealth and give
Pay Cash for College
31
You should always make sure you have a...
Direct Deposit
Budget
Credit Line
Credit Card
32
An important money principle to consider is that you should _____ and _____ your money.
invest; endow
Spend; invest
Save; invest
invest, lay out
33
A _____ financial goal takes up to two years to reach.
Long-tem
Medium-term
Short-term
Five-level
34
Being a spender has many more positives than being a saver.
True
False
35
To know your net worth, subtract your liabilities from your _____.
Other liabilities
Assets
Net Income
Previous Net Worth
36
Net Worth is All Assets minus All Liabilities.
False
True
