Assignment 4
1.If someone had a serious illness that required a long hospital stay with large medical bills and left them unable to work, they would have to use money from a financial reserve like a savings account or a 401k to pay bills.
2. Three to six months of income in a emergency savings account only to be used in the case of an emergency.
3. A savings that offered compound interest because not only will you earn money on what you have saved, but you also earn money on the interest you received on that money.
4. Daily compounding because you would have the best annual return, the amount would grow faster than annual or quarterly compounding. Each day the savings grow a little bit, building upon the growth from the previous days.
5. Making a monthly budget and saving a percentage of what is left over after bills and other personal needs.
6. I would want an emergency fund with enough money to live on for months, in case I were fired from my job or have a family emergency.
7.1. Describe a real or made up but realistic situation that could cause you or someone you know to have to use money from a financial reserve. (3-6 sentences. 2.0 points)
2. How many months' worth of expenses do you think your financial reserve should include? Describe at least two reasons for this decision. (3-6 sentences. 2.0 points)
3. Would you rather have a savings account that offered simple interest, or an account that offered compound interest? Why? (3-6 sentences. 2.0 points)
4. If you were opening a savings account with compound interest, would you prefer an account that offers annual compounding, quarterly compounding, or daily compounding? Why? (3-6 sentences. 2.0 points)
5. Which strategy for saving do you think would work best for you? Why? (3-6 sentences. 2.0 points) 6. Describe two financial goals that you would want to meet before you begin investing. Explain why you would want to reach those goals first. (2-4 sentences. 2.0 points)
7. Describe
2. Three to six months of income in a emergency savings account only to be used in the case of an emergency.
3. A savings that offered compound interest because not only will you earn money on what you have saved, but you also earn money on the interest you received on that money.
4. Daily compounding because you would have the best annual return, the amount would grow faster than annual or quarterly compounding. Each day the savings grow a little bit, building upon the growth from the previous days.
5. Making a monthly budget and saving a percentage of what is left over after bills and other personal needs.
6. I would want an emergency fund with enough money to live on for months, in case I were fired from my job or have a family emergency.
7.1. Describe a real or made up but realistic situation that could cause you or someone you know to have to use money from a financial reserve. (3-6 sentences. 2.0 points)
2. How many months' worth of expenses do you think your financial reserve should include? Describe at least two reasons for this decision. (3-6 sentences. 2.0 points)
3. Would you rather have a savings account that offered simple interest, or an account that offered compound interest? Why? (3-6 sentences. 2.0 points)
4. If you were opening a savings account with compound interest, would you prefer an account that offers annual compounding, quarterly compounding, or daily compounding? Why? (3-6 sentences. 2.0 points)
5. Which strategy for saving do you think would work best for you? Why? (3-6 sentences. 2.0 points) 6. Describe two financial goals that you would want to meet before you begin investing. Explain why you would want to reach those goals first. (2-4 sentences. 2.0 points)
7. Describe