ugba 135 midterm 1 Questions and Answers Fully Solved 100%

When are credit card payments due in order not pay a penalty? - ️️To avoid a late payment fee alway make sure your credit card payment is made two days before the due date if paying online, or five days before if paying by mail. What is a prenup agreement? - ️️A prenuptial agreement is entered into before marriage. This agreement can set forth what will happen to your and your spouse's assets and income in the unfortunate event of divorce, separation or death. What types of accounts does the FDIC insure up to $250,000 - ️️CD, checking accounts, savings accounts, IRA (Individual Retirement Accounts) and certain other retirement and trust accounts ALL Bankruptcy are handled in federal court - ️️TRUE Should you always try to contribute enough to your 401K to get the employer match? - ️️Yes Are community property laws established by the IRS or states? - ️️States What is a notary public? - ️️A public officer constituted by law to witness the execution of certain classes of documents like mortgage documents, wills, trusts, deeds By filing for bankruptcy, do you get rid of all of your debts? - ️️All debts EXCEPT taxes, alimony, child support, student loans Who said compound interest is the greatest discovery of mankind? - ️️Albert Einstein Times of inflation, what happens to the interest rate? (up or down) - ️️Higher interest rates What's the definition of compound interest? - ️️Interest paid on both the principal and accumulated interest Does it take a dollar of wages to pay back $1 of debt? - ️️No, it takes more than a dollar due to taxes What is the concept of the time value of money? - ️️Money is worth different amounts at different timesWhat is the biggest reason to start saving ASAP? - ️️Compounding interest As people get closer to retirement, how should they adjust their portfolio? - ️️Adjust portfolio to be less risky, more bonds less stocks According to the nightingale survey, What % of the people who people who start working at 25 become financial independence by 65? - ️️5% Everytime you get a paycheck, our goal is to save what percent? - ️️15% of total income The RULE OF FRED!!!!!!!!!!!! - ️️I GET PAID FIRST What's the first step in saving money? - ️️Creating a budget or spending plan What's our definition of being frugal? - ️️Not cheap but value oriented, working toward their goals, budgeting, and controlling expenses What is the rule of 72? - ️️Estimate how long it takes a sum of money to double, 72/interest rate If you have different types of debt, which is your first priority? (CC) - ️️Pay off the loan with the highest interest How do we define a millionaire in this class? - ️️Financially independent, living the life they want to lead, and able to take care of themselves without financial help from government sources What's the purpose of an emergency fund (security fund)? - ️️Cover 3-6 months of living expenses in the event of illness, job loss, or other emergency. Are bonds issued by our govt considered risky? - ️️No Interest rates rise.... - ️️Bonds Prices go down Bond prices up.... - ️️interest rates down (inverse relationship) In some states, some bonds are free from taxes on a federal and state level. - ️️TRUEHow do we define what a bond is? - ️️Bonds are like loans that obligate the issuer to pay a specified amount of interest for a specified period of time and then repay the bond holder the face amount of the bond What happens when a bond is in default? - ️️A bond default occurs when the bond issuer fails to make an interest or principal payment within the specified period. Defaults typically occur when the bond issuer has run out of cash to pay its bondholders.