Personal Finance Basics Quiz

What is the primary goal of personal finance according to Dave Ramsey?

• To accumulate as much debt as possible

• To achieve financial peace and security

• To invest in high-risk stocks

• To spend all your income

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Which of the following is a basic concept of Dave Ramsey's personal finance principles?

• Using credit cards for all purchases

• Living below your means

• Taking out multiple loans

• Ignoring budgeting

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According to Dave Ramsey, what is the first step in his "Baby Steps" plan?

• Pay off all debt

• Save $1,000 for a starter emergency fund

• Invest 15% of income in retirement

• Save for children's college fund

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What does Dave Ramsey suggest you should do with your credit cards?

• Use them for emergencies only

• Cut them up and stop using them

• Use them to build credit

• Transfer balances to lower interest cards

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Which term refers to the total amount of money you owe to creditors?

• Net worth

• Debt

• Equity

• Asset

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What is the purpose of an emergency fund according to Dave Ramsey?

• To invest in the stock market

• To cover unexpected expenses

• To pay off student loans

• To buy luxury items

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Which of the following is NOT one of Dave Ramsey's "Baby Steps"?

• Save $1,000 for a starter emergency fund

• Pay off all debt using the debt snowball

• Save for a down payment on a house

• Build a fully funded emergency fund

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What does Dave Ramsey recommend for paying off debt?

• Debt avalanche method

• Debt snowball method

• Minimum payments on all debts

• Ignoring small debts

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According to Dave Ramsey, what percentage of your income should be invested in retirement once you are debt-free?

• 5%

• 10%

• 15%

• 20%

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What is the final step in Dave Ramsey's "Baby Steps" plan?

• Pay off your mortgage early

• Build wealth and give

• Save for children's college fund

• Invest in mutual funds

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