Financial Literacy

Names:

Financial Future: Learning Assessment Five   Where to Stash Your Cash: Pick the best place [pick only one option] to put your money based on the needs indicated for the choices offered.  For each response offer a brief explanation as to why you made that pick over the other two options.  

  1. You just got your first paycheck and need a place to put it and start paying your bills.
    1. Money market account
    2. Savings account
    3. Checking account
  2. You need to establish your “stuff happens” fund. You have about $50 to start with and hope to make regular deposits.
    1. Mutual Fund
    2. Money Market Fund
    3. Savings Account
  3. You have money set aside for your small and large/long term emergency funds. You are ready to start making your money work for you.  You want to minimize risk and be certain of a fixed return on your investment.
    1. Savings account
    2. Bonds
    3. Stocks
  4. You have $1,000 saved for your emergency fund and want a place to put it, where it can earn more money and where you won’t be tempted to spend it.
    1. Checking account
    2. Money market account
    3. Certificate of Deposit
  5. You have established both of your emergency funds. You are ready to start making your money work for you.  You feel confident with your finances right now and can afford some risk in the hope of making more money.   You don’t intend to need this money any time soon.
    1. Certificate of Deposit
    2. Stocks
    3. Money market account
  6. You have some money to invest in the long run but you are uncertain of what would be a good company to invest in.
    1. Stocks
    2. Bonds
    3. Mutual Fund
  1. You have about $2,000 saved up and want to keep adding to it for your long-term emergency fund. You are concerned about tying up your cash though, and want to be able to get to it easily in case you need it.
    1. Stocks
    2. Certificate of Deposit
    3. Money market

Stock Market Exercise

Instructions: Part 1.   It’s New Years’ Eve 2013.  You have just inherited $5,000 from your wise and frugal Aunt Tillie.  Having already set up your two savings funds, you want to be sure to use this precious gift in a way she would be proud of.  Using the set of stocks provided below, develop a portfolio of the stocks you intend to invest in.  You can invest in one, all, or select stocks as long as your total portfolio comes to $5,000.  (You can have up to $100 cash left over.)

Name Symbol Industry Price* 12/31/13 #Shares Cost Price* Today Cost
Microsoft MSFT Tech $37
ExxonMobil XOM Oil $101
Amazon Amzn Retail $399
Pfizer PFE Pharma $31
Ford F Auto $15
Wells Fargo WFC Financial $45
Sprint S Telecom $11
Public Storage PSA Prop Rental $151
McDonalds MCD Restaurant $97
Home Depot HD Retail $82
Stock Portfolio
Remaining Cash
Total Portfolio $5000    

Part 2.  Time has gone by.  Using Yahoofinance.com, find the current stock prices* to see how much are your stocks are worth today.  Has your total portfolio gone up or down? *Stock prices rounded off to the closest dollar