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Financial Literacy Flashcards | StudBud
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Financial Literacy
Financial Literacy
46 terms
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Financial Management, Borrowing, Earning Power, Taxes and Investment
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1
Withdrawals from this account after retirement age can be made without paying taxes on them.
401 (k)
Roth IRA
403 (b)
Traditional IRA
2
This type of account will often give you zero earnings.
Savings Account
Money Market Account (MMA)
Checking Account
Direct Stock Account
3
Maximum annual employee contributions to an employer-sponsored retirement account as of 2019.
$12,000
$8,000
$6,000
$19,000
4
An investment option provided to you by the government.
DRIP Stock
U.S. Savings Bond
Certificates of Deposit (CDs)
Direct Stock
5
FICA tax rate for 2019.
10%
7.65%
2.75%
20%
6
Typically, the largest percentage of your tax dollars go here.
Federal Government
FICA
Unemployment and Disability Insurance
State Government
7
This is your income after taking either the standard deduction or itemized deductions.
Adjusted Gross Income (AGI)
Net Income
Gross Income
Taxable Income
8
Easy access to direct stock and DRIP investment plans.
Morgan Stanley
Vanguard Investments
Chase Bank
Computershare
9
Your tax dollars are used for all of the following except...
Emergency Services
Infrastructure
Education
Mortgage Payments
10
Maximum annual contributions to an IRA (Traditional or ROTH) for the year 2019.
$12,000
$6,000
$8,000
$19,000
11
This is an employer-sponsored retirement account for a not-for-profit organization.
401 (k)
403 (b)
Roth IRA
Traditional IRA
12
An investment plan that lets you defer taxes on dividends by reinvesting them in the company.
Mutual Fund
Money Market Account
Direct Stock
DRIP Stock
13
Your income before adjustments, deductions and taxes.
Taxable Income
Gross Income
Net Income
Adjusted Gross Income (AGI)
14
A cash kick-back given to shareholders by a company in order to share the company's profits.
Capital Gain
Annual Percentage Yield (APY)
Dividend
Interest
15
Social Security and Medicare payments fall into this tax category.
Local Taxes
FICA
State Taxes
Federal Taxes
16
A good guideline for the maximum amount you should owe each month in loan payments.
20% of your monthly gross income
10% of your monthly net income
20% of your monthly net income
10% of your monthly gross income
17
How often can you request a free credit report from each of the credit reporting agencies?
twice per year
monthly
once per year
never
18
Who is allowed to review your credit report without your permission?
your doctor
your parents after you are 18 years old
your employer
an automobile dealer with whom you are setting up a car loan
19
This is your income after making adjustments for things such as retirement plan contributions.
Adjusted Gross Income
Taxable Income
Gross Income
Net Income
20
Which of the following agencies provides free credit reports for consumers
TransUnion
Equifax
Experian
All of These
21
I can contribute to both an IRA and an employer-sponsored retirement account.
False
Pick this if you have no idea...
It depends...
True
22
Tax brackets are a way of levying this kind of tax.
progressive tax
proportional tax
regressive tax
flat tax
23
A good guideline for the maximum total debt you should carry.
20% of your net income
10% of your gross income
20% of your gross income
10% of your net income
24
Which account typically gives you the highest interest rate, or APY (annual percentage yield)?
money market account (MMA)
debit account
savings account
checking account
25
Earnings you receive due to your shares of stock growing in value as the company itself grows.
Capital Gains
Annual Percentage Yield (APY)
Interest
Dividends
26
Which of the following is not something you should be prepared to provide when getting a loan?
your rental or mortgage payments
your medical history
your annual or monthly income
your social security number
27
Which of the following is part of a typical spending plan?
All of These
Income
Expenses
Goals
28
Which of the following can impact your credit score?
paying cash for a used car
making a late car loan payment
checking your credit score
getting bonus pay from your employer
29
Which of the following is not part of the SMART goal acronym?
Specific
Realistic
Attainable
Measurable
30
Money rewarded to you by the bank in return for letting them lend your money out.
Capital Gains
Dividends
Certificate of Deposit (CD)
Interest
31
Which of the following is not a part of the DECIDE acronym for financial decision making?
establish some criteria
define your financial goal
identify the cheapest option
evaluate the results
32
Combination of stocks a broker will invest in for you to help you diversify within one account.
Mutual Fund
Direct Stock
DRIP Stock
U.S. Savings Bond
33
Payments made to a bank in return for them letting you borrow money.
Taxes
Earnings
Interest
Capital Gains
34
Who should report identity fraud?
credit reporting agencies
the victim of the fraud
the company that accepted a stolen credit card
the police
35
As a general rule, how often should a spending plan be re-evaluated and adjusted?
Weekly
Monthly
Once or Twice Per Year
Never
36
Buffers the effect of taking losses in the stock market from "buying high" or "selling low".
Dollar-Cost-Averaging
High-Risk Stocks
20-Year CD
Low APY
37
Guaranteed to double in value from their issue price after a period of 20 years.
Mutual Fund Purchases
Certificates of Deposit (CDs)
U.S. Savings Bonds
Shares of Stock
38
Sales tax collected at a retail store is an example of this kind of tax.
Flat Tax
Capital Gains Tax
Progressive Tax
Regressive Tax
39
Money taken out of your paycheck by your employer as an approximation of the taxes you'll owe.
Interest
Withholding
Deductions
Contributions
40
Your take-home pay. What you actually earn after all taxes have been paid.
Adjusted Gross Income (AGI)
Gross Income
Net Income
Taxable Income
41
A stock purchasing plan that lets you buy stock without going through a broker.
DRIP Stock
Mutual Fund
Money Market Account
Direct Stock
42
Which expenses should be left out of a spending plan?
Variable Expenses
Periodic Expenses
Fixed Expenses
None of These
43
Which of the following is not a type of credit?
Phone Service
Car Registration
Car Loan
Credit Card
44
A loan with monthly payments structured to pay the loan off in full by the end of its duration.
Short-Term Loan
Hard Loans
Amortized Loan
Line of Credit
45
Which one of the following accounts is not tax-deferred?
Traditional IRA
403 (b)
ROTH IRA
401 (k)
46
An investment with fixed earnings and a fixed maturity date.
DRIP Stock
Direct Stock
Certificate of Deposit (CD)
Mutual Fund
