Download Financial Literacy Test

Financial Literacy Test
List the 5 steps in the Decision Making
Process
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Identity the problem
Gather information and list possible alternatives
Consider consequences of each alternative
Select the best course of action
Evaluate the results
• Financial planning is a ___thinking process____________
______________________ that helps achieve goals
List the five steps in creating a Financial Plan?
• Determine your current financial situation
• Develop your financial goals
• Identify your options
• Evaluate your alternatives
• Create and use your financial plan of action
What does a SMART goal stand for?
• Specific
• Measurable
• Attainable
• Realistic
• Time-Limited
What is Gross Income?
• Hours times rate of pay
What is Net Income?
• Gross income minus tax deduction
What are the four taxes employers must
deduct from your paycheck?
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Federal Withholding
FICA
Medicare
Utah State Withholding
What does FICA stand for?
• Federal Insurance Contribution Act
What is a W-4 used for?
• Used to tell employer payroll department the amount of allowances for
employee.
What is an I-9 used for?
• Evidence of illegible work status
What does a W-2 show?
• Reports taxable income and taxes withheld
How is a 1040 EZ different from a 1040?
• Shorter version of 1040
What is an Entrepreneur?
• Self-employed person
What is a spending plan?
• A tool used to record and track projected and actual income and
expenses over a period of time.
• Also called a budget.
What is a check?
• Access to funds in checking account
What does it mean when you bounce a
check?
• Insufficient funds
What is a checking account register?
• Tracks checking account transactions
What does ATM stand for?
• Automated Transaction Machine
What is a Debit Card?
• Checking account access using card
What is a PIN?
• Personal Information Number
What is Direct Deposit?
• Paycheck deposit directly from employer to employee checking
account
What is Bankruptcy?
• All debt removed
What is Debt?
• Amount owed to company
What is the Time Value of Money mean?
• Money value in the future
What is insurance?
• Damage coverage
What is an insurance premium?
• Amount paid for insurance coverage
What is compound interest?
• Interest amount growing over period of time
Banks and Credit Unions are FOR PROFIT
• True
• False
Define the word Usury.
• The illegal action or practice of lending money at unreasonably high
rates of interest.
Damon Williams loved to buy New Balance
basketball shoes.
• True
• False