The Interest-ing Stuff
This type of interest is calculated only on your original amount, not on the interest it earns.
This type of account is used to store money safely and earn a small amount of interest.
What is a savings account?
The maximum contribution to this kind of retirement savings is currently $8,000 for those over 50.
What is a Roth IRA?
This short-term fund is used for car repairs and surprise bills.
What is an emergency fund?
Skipping this daily purchase for a week could easily save $20 or more.
What is coffee, boba, lunch out, etc.?
This term describes earning interest on interest.
What is compound interest?
This type of savings account earns more interest, but you agree to leave money in it for set period of time.
What are certificates of deposit (CDs)?
This type of retirement must be sponsored by an employer organization.
What is a 401(k) retirement plan?
Having part of your monthly check deposited directly to your savings account is an example of this concept.
What is automated savings?
These vary from one savings account to another and can affect your financial growth over time.
What are interest rates?
What is an annuity?
Avoid impulse buys and cancel subscriptions are both examples of this.
What is ways to save money?
This penalty applies if you withdraw from most retirement accounts too early.
What is a 10% early withdrawal penalty?
Experts recommend saving 3 to 6 months' worth of these.
What are living expenses?
This phrase explains why money today is worth more than money tomorrow.
What is the time value of money?
Starting early lets interest accumulate longer. This is why this group has the biggest advantage in saving.
What is young people or students?
Someone who wants to purchase a $2000 refrigerator in the next 10 months and puts aside $200 per month is using this method.
What is the sinking fund approach?
This kind of retirement account typically has some level of employer matching contribution.
What is a 401(k) plan?
This phrase means you should put money into savings before spending elsewhere.
What is pay yourself first?
This government program provides retirement income, but you probably shouldn't rely on it alone.
What is Social Security?
The Rule of 72 says you can find this answer by dividing 72 by your interest rate.
How quickly will your investment double?
What are the interest rate and the number of compounding periods?
This type of contribution to a retirement plan will be subject to tax when it is withdrawn instead of when it is made.
What is a pre-tax contribution?
The amount you would set aside today to have $6,600 in 10 years at 6% annual interest.
What is the Present Value?
73 years old
What is typically the age for required minimum withdrawals from retirement accounts?