Retirement Diagnostic Quiz

An investment portfolio is made up of

• Stocks & Bonds

• Mutual Funds

• CDs

• All of the above

What is the Rule of 72?

• A rule for determining the best time to buy stocks
• A method for calculating the area of a circle
• A formula for converting Celsius to Fahrenheit
• A formula used to estimate the number of years for an investment to double

What is compound interest?

• Option A: Interest calculated on the initial principal and also on the accumulated interest of previous periods
• Option A: Interest calculated only on the initial principal
• Option C: Interest calculated on the total amount borrowed without any additional accumulation
• Option B: Interest calculated based on the borrower's credit score

What is an Individual Retirement Account?

• A type of credit card
• A retirement savings account with tax advantages
• A form of life insurance
• A checking account for daily expenses

What is the difference between a certificate of deposit (CD) and a savings account?

• A CD typically has a fixed term and higher interest rate compared to a savings account.
• A CD has a lower interest rate compared to a savings account
• A CD allows unlimited withdrawals like a savings account
• A CD does not have a fixed term like a savings account

What is a money market account?

• A type of savings account with higher interest rates
• A type of credit card with cash back rewards
• A type of investment in the stock market
• A type of checking account with no interest

How can people get Social Security when they retire?

What is a 401K?

What do you think a pension is and how is it similar or different from a 401K?

Why should people plan for retirement when they are young? Explain.