Investment
What are the five different types of investments?
Shares, Fixed Interest, Cash, Government Bonds, Property
What is 17% of $3000
$510
What is the savings formula?
Savings = income - expenses
What are the three different time frames for goals?
Short, Medium, Long
What are shares?
a small portion of a business that fluctuates in price
What is the simple interest formula?
SI = PRT
If Sarah gets paid $4,000 per week. How much does she make in a year?
$208,000
What are SMART goals?
S M A R T
What is the purpose of diversification
to minimise risk within investments
Sally invests $5000 in a term deposit for 6 year at 7%. What is her total investment?
$7,100
If Sarah makes $700 per week and spends $2,300 per month. How much is she savings per month?
700 x 4 = 2,800
2800 - 2300 = 500
What time frame of goal is this?
Sally wants to save for her house in 6 six.
Long
What is diversification?
The division of money across several investment options to minimise risk.
What percentage did the investment increase by?
Sally invested $6000 and after 7 year had $8,300.
SI = PRT
2,300 = 6000 x 7 x R
0.38 = 7 x R
0.05 (5%) = R
If Sarah makes $600 per week and spends $800 per fortnight. How much savings will she have by the end of the year?
600 x 52 = 31,200
400 x 52 = 20,800
31,200 - 20,800
= 10,400
What is a financial institution?
Somewhere that stores and redistributes wealth to its members. It also makes critical decisions around risk and managing finances
What are government bonds?
Investing in your/or another governments currency and economy to then receive more later in time.
What percentage did the investment increase by?
Daniel's investment went from $50,000 to $54,000 in the space of 1 year.
SI = PRT
4,000 = 50,000 x 1 x R
0.08 = 1 x R
0.08 (8%) = R
What is financial independence?
When you have accumulated enough savings to support yourself for a reasonable amount of time and can complete your goals in a timely manner and do not have to worry about debt.
What are the three parts of the managing finances flowchart?
goal setting
savings and investing
minimising risk