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LET’S PRACTICE
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7. Financial experts recommend saving ____________ of living expenses to use for emergencies. a. 1 to 2 years c. 3 to 6 months b. 1 month d. 2 months 8. T F Your monthly contribution to savings should be an actual, but low priority budget item. 9. In about ten years, Eileen wants to start her own business. She put $5000 to an investment that earns a compounding rate of 6%. She needs $10,000 in 10 years. Will she double her money in that time? What Rule can she use to estimate whether she’ll have enough money? _ ____________________________________________________________________ _ ____________________________________________________________________ 10. An emergency savings fund should have a ___________ dollar amount and should be replenished to that amount whenever it is used. a. (an) approximate c. high b. hundred d. specific 11. Elle has her pilot license. She dreams of one day of owning her own plane. The problem is, all she really does is dream about it. How can she make this a measurable and achievable goal to improve her chances of success? _ ____________________________________________________________________ _ ____________________________________________________________________ _ ____________________________________________________________________ 12. Which of the following is NOT a reason to increase the amount of emergency savings you have on hand? a. adding dependents to your family c. having a freelance job b. moving to a house or apartment with a higher rent d. vacation plans 13. In your own words, explain how a round-up account works. Provide an example. _ ____________________________________________________________________ _ ____________________________________________________________________ 14. Briefly explain the difference between saving and investing. _ ____________________________________________________________________ _ ____________________________________________________________________ _ ____________________________________________________________________ PRODUCT PREVIEW
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Chapter 8 | Super-Size Your Savings 148
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