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Checking and Savings Pre-Test

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True or False

1. It does not matter which kind of checking account you open. Just get the one with the lowest service charge.

True or False

2. Some checking accounts pay interest but the interest rates vary from bank to bank. It pays to shop around.

True or False

3. You can any type of savings account for your IDA account.

True or False

4. You always have to pay a service charge on a checking account regardless of the balance.

True or False

5. What is a senior account?

a) a checking account you open your last year of high school

b) a bank account that is specially designed for older customers

c) an inactive or dormant account

6. Why should you always write your checks in ink?

a) So the amount on the check cannot be altered.

b) So the signature on the check cannot be erased.

c) Both a and b.

7. What is the first thing you should do if you reconcile (balance) your checkbook against your checking account statement and you find your balance is different from the bank’s balance.

a) Make sure you entered all AMT withdrawals and subtracted them in your checkbook.

b) Double check all additions or subtractions in your checkbook.

c) Call the bank and complain

8. Why should you write the words “for deposit only” on checks you are endorsing?

a) That guarantees the check cannot be cashed by someone else if lost.

b) Because that makes you look smarter than you would if you just used a blank endorsement.

9. If you have $1,000 deposited into an account that pays 6% interest, how long would it take for that account to be worth $2,000 or double the balance now.

a) 20 years

b) 12 years

c) 4 years

d) forever

10. When is the best age to open an IRA to provide for your retirement?

a) When you are age 55

b) When you have put all the money you can in your company’s retirement plan

c) As early as you can and as young as you can be so the money has time to grow

d) Never if your have a retirement plan at work

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