Saving for the Future

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# Saving for the Future - PowerPoint PPT Presentation

Saving for the Future. Types of Savings Accounts. Passbook Savings Account. Minimum balance required to open Withdraw/deposit at anytime ATM/debit Pays lowest interest rate. Money Market Account. Minimum balance required Limited number of withdrawals/deposits per year

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## PowerPoint Slideshow about 'Saving for the Future' - hermione

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Presentation Transcript

### Saving for the Future

Passbook Savings Account
• Minimum balance required to open
• Withdraw/deposit at anytime
• ATM/debit
• Pays lowest interest rate
Money Market Account
• Minimum balance required
• Limited number of withdrawals/deposits per year
• Slightly higher interest rate than a passbook account
Certificate of Deposit (CD)
• Large minimum balance required to open
• Time based – lock in money for a certain period of time
• Pays the highest interest rate of any savings account
• Penalty for early withdrawal
Which One?
• Depends on your financial goals
• How much interest you want to earn
• How you plan to use the money
• How much money you have at the time of opening the account

### Saving for the Future

Review Quiz

1. Saving is
• (a) putting money aside for future use.
2. When a person saves money, he/she is creating spending__________
• (a) power.
• (b) security.
3. Money in a savings account earns
• (a) dividends.
• (b) interest.
4. Dividing 72 by the interest rate is known as
• (a) Rule of 72.
• (b) doubling by 72.
6. Liquidity is
• (a) the ability to move money from one account to another.
• (b) the ability to quickly withdraw money and turn it into cash.
7. Banks pay interest because
• (a) they are using your money to loan to others.
• (b) they make money by paying you.
8. Stock is
• (a) a portion of profits paid to shareholders.
• (b) an investment and ownership in a company.
9. A mutual fund is
• (a) a stock listed on the NYSE.
• (b) an investment in a collection of stocks.
10. Stocks are
• (a) more risky than savings.
• (b) less risky than savings.