BANKING AFFAIRS

Detailed explanation-1: -Suppose you had $100 in a savings account and the interest rate was 2% per year. After 5 years, how much do you think you would have in the account if you left the money to grow? Answer: C, more than $102.

Detailed explanation-2: -Buying a single company’s stock usually provides a safer return than a stock mutual fund. Answer: False. A mutual fund is an investment pool that purchases securities. Think a basket of stocks; some mutual funds include stocks from tens or hundreds of companies.

Detailed explanation-3: -Diversification is a common investing technique used to reduce your chances of experiencing losses. By spreading your investments across different assets, you’re less likely to have your portfolio wiped out due to one negative event impacting that single holding.

Detailed explanation-4: -Being financially literate means having the knowledge and confidence to efficiently and effectively manage, save and invest money for you and your family. This can include everything from getting out of debt, budgeting, insurance, investments, real estate, college and retirement planning to and tax and estate planning.