216 - Investments and retirement quiz - Coopling.com.br

What is the primary goal of investing?

• To minimize all financial risks.

• To allocate money into assets to generate income or profit.

• To save all income for future use.

• To avoid inflation entirely.

How are saving and investing different?

• Saving involves earning interest, while investing only involves spending money.

• Saving sets aside income for future use, while investing uses those funds to purchase assets that can grow over time.

• Saving is risk-free, while investing is illegal without a financial advisor.

• Saving is short-term, while investing is for retirement only.

Which investment option is generally considered to have the highest potential returns?

• Bonds.

• Real estate.

• Stocks.

• Savings accounts.

What is a key benefit of starting retirement planning early?

• Avoiding the need to diversify your portfolio.

• Maximizing employer matches and allowing investments more time to grow.

• Eliminating all market risks.

• Avoiding the need for professional advice.

What is the risk-return tradeoff?

• The process of avoiding all high-risk investments.

• The balance between an investment’s potential risk and its potential return.

• The relationship between savings interest rates and inflation.

• The guarantee that high-risk investments always succeed.

What type of retirement account is commonly recommended for long-term growth?

• Checking account.

• 401(k) or IRA.

• Savings account.

• Certificate of deposit.

What are some challenges of investing for retirement?

• Market volatility, potential loss of principal, and the need for ongoing management.

• Guaranteed losses and penalties for diversification.

• Lack of professional advice and high employer match limits.

• Inability to invest in multiple asset types.

Why is diversification important in investments?

• It eliminates the need for risk management.

• It spreads investments across asset types to reduce overall risk.

• It guarantees consistent high returns.

• It minimizes contributions to retirement accounts.

What advice do experts give about retirement planning?

• Avoid all employer retirement plans.

• Start early, diversify, maintain a long-term perspective, and stay informed.

• Focus exclusively on high-risk investments for faster growth.

• Avoid professional advice to reduce fees.

Why is it essential to regularly review and adapt your retirement plan?

• To completely eliminate risk.

• To ensure it aligns with your changing financial goals and market conditions.

• To avoid paying premiums on insurance policies.

• To increase annual contribution limits automatically.