Upgrade to remove ads
Financial Peace Chapter 2 Study Guide
Terms in this set (15)
Interest paid on interest previously earned
Five hundred dollars in readily available cash to be used only in the event of an emergency
Percentage paid to a lender for the use of borrowed money
The five steps to financial success
Saving money over time for a large purchase
An account that generates interest income on the available balance in the account
The persistent increase in the cost of goods and services or the persistent decline in the purchasing power of money
What are the five foundations?
1. Save a $500 emergency fund
2. Get out of debt
3. Pay cash for car
4. Pay cash for college
5. Build wealth and give
What are the three basic reasons to save money?
1. Emergency Fund
3. Wealth building
Is building wealth described as a marathon or a sprint?
What are two things to consider when evaluating the time value of money?
The inflation rate and rate of interest
What is the key ingredient when it comes to wealth building?
What should you do instead of borrowing money for large purchases?
Set it aside in a sinking fund over time and pay with cash
Does your income level greatly affect your spending habits?
What should a fully funded emergency be at your age?
YOU MIGHT ALSO LIKE...
PF Ch. 2
Foundations in Personal Finance Chapter 2 Savings
Personal Finance Chapter 2