QuizMe

1: Why is the importance of savings emphasized?

To impress friends and family

To have funds for emergencies and future goals

To fund luxurious vacations

To donate to charity

2: What is the primary purpose of building an emergency fund?

To invest in high-risk stocks

To have money set aside for unexpected expenses

To buy luxury items

To pay off existing debt

3: What does a “sinking fund” involve?

A fund that’s losing value over time

Putting all your money into stocks

Saving for a specific future expense

A fund for sinking ships

4: Which example best fits a sinking fund goal?

Going on a spontaneous shopping spree

Saving for retirement

Saving for a new car in 2 years

Funding a world tour

5: What’s a key advantage of a high-yield savings account?

It offers low interest rates

It provides easy access to your funds

It offers higher interest rates compared to regular savings accounts

It’s only for experienced investors

6: Why is an emergency fund important before investing?

Investing requires no initial funds

Investments are guaranteed to profit

It provides a safety net for unexpected situations

It’s a requirement for tax purposes

7: How should you prioritize your savings goals?

Focus only on retirement savings

Allocate funds equally to all goals

Prioritize emergency fund, then sinking fund, and finally long-term goals

Put all your savings into short-term goals

8: What’s the recommended amount for an emergency fund?

Three to six months’ worth of expenses

One week’s worth of expenses

It varies based on your daily spending habits

Twice your annual income

9: How does a sinking fund differ from an emergency fund?

A sinking fund is for planned expenses, while an emergency fund is for unforeseen situations

An emergency fund is for retirement, while a sinking fund is for vacations

A sinking fund is only for luxury purchases, while an emergency fund is for daily expenses

An emergency fund is for debts, while a sinking fund is for long-term investments

10: How can you maximize the benefits of a high-yield savings account?

By withdrawing funds frequently

By keeping a low balance to minimize risk

By consistently adding money and letting it accumulate over time

By investing in high-risk stocks