Budgeting
What can you use to be aware of where your money is going?
Budget, journal, bill pay schedule, bank statements
Why is working “under the table” risky and not recommended?
It's illegal, fewer protections if employer does anything wrong or illegal, no benefits, might get paid below legal minimum wage, not paying towards Social Security, fines from IRS, and no workman's compensation and short-term disability
What are things to help your credit score?
Pay bills on time, don't use or borrow too much debt (under 30%), keep accounts/cards open, don’t apply to a bunch of credit cards or loans at once
Name at least 4 types of Debt?
Credit cards, school loans, mortgage, auto loans, mortgages, government debt, personal loans, and medical debt
What at least 2 things people typically save for?
Emergencies, personal goals, irregular savings, retirement
What the “3 Golden Questions” of personal finance that can help anyone make a solid financial plan?
What are your goals?
What are your priorities?
What are your values?
What are at least 2 examples of passive income?
Investing, real estate, renting, YouTube channel, affiliate marketing, reselling, royalties, art, etc
What does APR stand for?
Annual Percentage Rate
Give an example of secure and unsecure debt?
Secure - Auto loan or home mortgage loan
Unsecure - Credit card
What are at least 3 reasons to use banking to save?
FDIC insured, your money will grow, keeps you organized, automate savings, round up expenses to save
If your household loses income, what expenses are recommended to prioritize? (Answers should be by importance)
Needs (housing, food, things you can't do without); Wants (things we like to have but can live without)
What things are deducted from your gross pay in your paycheck?
FICA, local, state, and federal taxes, insurance, and retirement contributions
How long does a late payment stay on your credit report?
7 years
Name 3 ways to make sure not one is using your information to make fraudulent purchases
Check your Credit Reports periodically, Review bank & credit card statements periodically, Don’t share your banking, social security #, passwords, & personal data, place a fraud alert, credit freeze, avoid scams, use Federal Trade Commission (FTC) to learn, Use smart password hygiene, contact the Consumer Protection Team
What is the recommended amount for people to save for emergencies?
20% of income, 6-9 months of bills or expenses, 3 months of income
Name at least 3 types of bank accounts
Savings, checking, 401k, 403b, IRA, Roth IRA, Money Market, Certificate of Deposit
How can social security help you in the future?
Monthly retirement income
Social Security Disability
Name the 3 credit bureaus
Equifax, Experian, TransUnion
What are 3 examples of "predatory" financial products?
Check cashing stores & services, Payday Loans, Debt Repair Companies, Credit Repair Companies, Debt Settlement Companies
Name 3 types of retirement accounts
IRA, Roth IRA, 401K, 403B, Social Security
What is the 50-30-20 rule? Explain what goes into each?
50% goes to needs
30% goes to wants
20% goes to savings
Why invest in your retirement?
Best way to build wealth over time, Social Security is not enough, pensions are not as common as before
What is the credit score range? What is the lowest credit score you can have to be considered to have good credit?
Credit scores start from 300 to 850
670 is the lowest score to be considered to have good credit
What are the 3 most important things a lender wants to see to qualify you for a loan?
Stable income, good credit, not too much debt (debt-to-income)
If you invested $100 every month when you turn 18 years old until you retire at age 65 (47 years of investment at 10%, compounding monthly), what is your estimated earn at 65 years old.
Compound interest will give you
$1,495,355
Total spend: $57,600