UGBA 135 Midterm question n answers rated A+ 2023/2024

UGBA 135 Midterm Emergency fund - correct answer in a savings account 3-6 months living expenses Definition of millionaire - correct answer financially independent Rule of 72 - correct answer The number of years it takes for a certain amount to double in value is equal to 72 divided by its annual rate of interest. Each time you get paycheck, what is % goal you should put away (savings goal) - correct answer 20% What does being frugal mean - correct answer not spending freely or unnecessarily, but considering quality, value, needs and benefits along with price Opening checking accounts, bank accounts → fees and balance requirements are different - correct answer checking: 2 months savings: 4-6 months monthly fees Survey 25 - 65, % of them become financially indpt. After reaching retirement age - correct answer start working at 25, by 65: 1 will be rich 4 will be financially independent, able to take care of themselves 45 will have some funds but will still need some form of continuing financial aid 50 will essentially be broke 5% households financially indpt. What is a spending plan - correct answer An income and expense statement sometimes referred to as a budget which records both planned and actual income and expenses over a period of time Biggest reason to start saving as early as possible - correct answer compound interest What is compound interest - correct answer Earning interest on interest What is rule of fred - correct answer I get paid first In times of inflation, do interest rates go up or down - correct answer interest goes up What is a notary public - correct answer A public official authorized to attest to the authenticity of signatures. 401k plan - correct answer a tax-deferred investment and savings plan that acts as a personal pension fund for employees made by employers employer contributing/match, always put in enough to maximize what employer puts in - correct answer for 401k plans to maximize money Most important factor in determining credit score - correct answer payment history Highest credit score you can get? - correct answer 850 Best way to establish good credit - correct answer Borrow money and pay it back on time according to its terms and when you dont need it Debt:credit ratio - correct answer total balance on your credit cards and other loans compared to your total credit limit