Stocks
The S&P is
An index of the 500 largest publicly-traded companies in the US
Alma recently started investing in a target-date fund with a planned retirement date that is 38 years in the future. How is the portfolio in her TDF most likely allocated?
Majority stocks and a small percentage of bonds
Zora has $5,000 to invest. When assessing her goals, she decides that she wants to create a low-risk, low-volatility portfolio. Based on this assessment, a good strategy for Zora would be:
Dollar Cost Averaging
Robo Advisor does not have
a higher account minimum than a traditional financial advisor
Which fund will most working American citizens have access to at retirement
Social Secruity
What is a robo-advisor?
An investment management service that uses a computer program to manage assets
Alberto has decided to invest his retirement money into a mutual fund filled with mid-sized US companies. The fund manager is
The person who selects which stocks to include in the fund
In 2022, Noah decided to start investing in a target-date fund at Alpine brokerage. They are 24 years old, have been working for 5 years, and are planning on retiring at 67. Which target-date fund should they choose?
Alpine Target Retirement 2065 Fund
How can compounding increase your investment’s growth?
By reinvesting your earnings to gain additional returns
If you invest money into an index fund that tracks the Dow Jones Industrial Average, you would expect
Your returns to track the performance of 30 large US companies
Ash remembers learning about both 401(k)s and IRAs in his personal finance class during high school. He’s early in his career, and he can really only afford to fund one type of account with about $100 per month right now. What should he do?
Fund a 401(k) because his employer is offering a match, up to 3% of his salary
Trevor has saved $500 in a savings account that earns 0.5% interest annually. What will most likely happen to the purchasing power of his savings over time?
His purchasing power will DECREASE because the interest rate is lower than the historical rate of inflation
How is an exchange traded fund (ETF) different from a mutual fund
An ETF can be traded throughout the day and bought from other investors, like a stock
Kendall completed her med school training 10 years ago and is now a successful highly-paid surgeon at a major hospital. What type of account would be most beneficial for Kendall to use to start saving for retirement, so she can enjoy time off after a stressful career?
A traditional 401(k), because it will reduce her taxable income now
You’ve set a goal of having $10,000 after 15 years. If you estimate that your investment account will have an average yearly growth factor of 1.09, write the equation.
10000 = x(1.09)15