Money $mart Review Questions:
How to Get There…

1. What does it mean when we refer to the “time value” of money? How did this affect the two savers on page 20?
2. People often put off starting a savings plan, because the “timing isn't right,” “the kids are young,” or “there are other priorities.” Knowing what you do about compounding interest and the time value of money, what might you tell someone who is delaying saving?
3. What does “pay yourself first” mean?
4. Look at the things you spend money on. List five “needs” and five “wants.”
5. What is compound interest?
6. Which earns you more money: a savings account with daily compounding, or a savings account with monthly compounding?
7. When comparing different accounts, should you compare the interest rates, or the Annual Percentage Yield (APY)?
8. What are ways that you organize your bill-paying and financial record keeping? In what ways does your system work well, and what are some of the problems with it? Name three adjustments that you could make to improve your system.

Exercise 1: List your long and short-term goals, their approximate costs, and when you would like to purchase them. Use that information to make a plan to save. Adjust your Income and Expenses worksheet to accommodate these goals.

Items to return to CEI upon completion:

• Answers to review questions
• List of long and short-term goals
• Revised Income and Expenses worksheet

These items will be reviewed and returned to you for your use and reference.