ECONOMICS
BUDGETING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Saving for retirement
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Saving for a down payment on a home
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Saving to buy a car
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Saving to go on vacation
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Detailed explanation-1: -Short-term goals are within a five-year window, while long-term goals are at least five years out. CDs, money market accounts, and traditional savings accounts are best served for short-term goals. Investing is generally reserved for long-term goals so there’s time to withstand performance fluctuations.
Detailed explanation-2: -A regular savings plan will keep you focused on your goals and allow you to choose how you invest your money depending on your attitude to risk. You can also choose the appropriate term (short-term or long-term) and contributions based on your circumstances.
Detailed explanation-3: -Through saving money, your money is kept safe, and easy to access should you need it. By investing early over time, your money grows in value, benefiting from the magic of compounding. Remember that investing early, along with compound interest, can result in higher investment amounts versus a late investment start.
Detailed explanation-4: -Eliminate Your Debt. Set Savings Goals. Pay Yourself First. Stop Smoking. Take a “Staycation” Spend to Save. Utility Savings. Pack Your Lunch. More items