Pros of CD
Cons of CD
Steps to Open CD
CD Basics
Random
100
Can CDs have higher interest rates than savings or MMA? (Yes or No)
Yes
100
Fill in the blank: Early withdrawal can lead to receiving ___________.
Penalty fees
100
What is the lowest minimum for a CD?
$0
100
What does CD stand for?
Certificate of Deposit
100
What is a credit hour?
Unit of measurement used by universities to determine the amount of coursework and time to complete a class.
200
What is one pro of having a CD?
Safe rate of return, rates higher than savings or mma, or reduce spending temptations
200
What is a con of a CD?
Penalties, typically earns less than stocks and bonds over time, or low rates
200
What are the two different payment options?
End of term and Periodic Disbursements
200
What happens if you need to take out money from the CD before the end of the term.
You get charged with an early withdrawal penalty.
200
What is the equation for slope-intercept form.
y=mx+b
300
How do CDs reduce spending temptations?
CDs need to sit there for a long period of time, preventing the individual from spending money.
300
Why are CDs typically considered worse than stocks and bonds?
They typically earn less than stocks and bonds over time.
300
Explain the difference between standard CD and liquid CD.
Standard - Penalties if withdrawn early
Liquid - No penalty for early withdrawals
300
Where can you open CDs?
Banks, credit unions, and brokerages.
300
What is the highest credit score you can achieve?
850
400
Why are CDs a safe financial tool?
They guarantee a positive rate of return.
400
Name one other con of CD that is NOT mentioned in the slide.
Limited liquidity, interest rate risk, inflation risk, taxes, strict requirements to open, etc.
400
What is the last step to opening a CD?
Set Maturity Preferences.
400
What is the difference between fixed-rate CDs and variable-rate CDs?
Fixed-rate CDs have a constant interest rate throughout the term, while variable-rate CDs have fluctuating interest rates.
400
What is the difference between W-2 and W-4 form?
W-4 is an input form you fill out to tell your employer how much tax to withhold from your paycheck, while a W-2 is an output form your employer gives you at year-end to report your total earnings and taxes already withheld.
500
What are the three pros of having a CD?
Safe rate of return, rates higher than savings or MMA, and reduce spending temptations.
500
What are the three cons of having CDs?
Penalties, earns less than other financial tools, and has low interest rates.
500
List all the steps to opening a CD.
Choose CD type and term, find the best bank or credit union, choose your interest payment options, apply and select beneficiaries, fund your CD, set maturity preferences.
500
What is APY (Annual Percentage Yield)?
APY (Annual Percentage Yield) is the actual yearly return you earn on an interest-bearing account, taking compound interest into account.
500
What is the compound interest formula?
