Fp 101 Week 2 Dqs

FP/101 Week 2 DQ's

DQ 1

Refer to p. 87–93 of Personal Finance. Identify two cash management products and provide a short description of each. Do you have any experience with these products?

Checking accounts are demand deposit accounts, giving you the right to deposit, and withdraw funds at your own will with little or no notice to the bank. Checking accounts allow you to pay bills and make deposits without the hassle of handling cash all the time. I currently have two checking accounts, one is for my personal use and the other is business use only.

CD accounts are like regular savings accounts, only you have to wait until the maturity before you can use any of the money that you deposited. CD’s generally pay a higher interest rate than other savings options; the longer the commitment, the higher the interest rate. I have never had a CD account and my experience is limited.

DQ2

Review Section 4.4.1 of Personal Finance. What are some questions you should consider when opening a checking account?

Will you earn interest on your balance? If so, at what rate?

Will you be required to keep a minimum balance in the account? If so, how much is it, and what is the penalty for going below that minimum?

Is there a monthly fee? If so, how much?

Can you access the account with a debit card (i.e., a card that enables you to withdraw money from your account electronically)?

Does the account offer overdraft protection?

Are there any other fees?

DQ3

What are some ways to save and store your personal financial information?

Some ways to save and store your personal financial information are keeping them in a file cabinet, keeping the in a lock box, and keeping them in a safe deposit box.

DQ 4

Review Mary’s balance sheet. Do you think Mary is saving enough money for emergencies, college, or retirement? What Rule of Effective Cash Management should Mary use to improve this situation?

She is definitely not saving money. First she...