A majority of Americans believe that they are in control of their money and investments. According to a "National Assessment of Financial Capability" conducted by the Financial Industry Regulatory Authority Investor Education Foundation, 75 % of People believe they are proficient in managing financial issues in the day-to-day as well as a family investment.
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Family investments are perhaps among the most significant aspects a family has to deal with in their future.
But only around 55 percent (a failing on a common grade scale) had correct answers to five questions in the study that focused on the investments of their families. Are you able to answer them correctly? Let's see…
1.) Let's say that you had $100 saved in your savings bank account earning an interest rate of 2 percent per year. In five years, will your savings account be worth more or less than precisely $102, or do you have less than $102?
2.) Consider that the interest rate of the savings account you have is one percent per year, and inflation is 2 percent per year. After one year, could the funds in the account be used to purchase more than it currently does in exactly the same amount or less?
3.) When interest rates increase then what happens to the bond market? Change, rise, remain the same, or does there exist no correlation?
4.) False or true A 15-year mortgage generally will require higher monthly payments than a 30-year loan, but your total cost of interest for the course of the loan will be lower.
5) False or true buying an individual company's stock typically yields better returns over a mutual fund for stocks.