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1.
A home equity line of credit is the same thing as a second mortgage.
False. The two are different. The former involves a revolving line of credit, while the latter involves a fixed amount of money repaid over a fixed period.
2.
Using a growth investment to build up money for a major purchase is most appropriate for a _______ time horizon.
Long. Although it is possible to profit from growth investments in the short term, they tend to fluctuate in value. Keeping them for the long term can smooth out those fluctuations.
3.
Budgeting for a major purchase has many advantages; one of them is that _______.
You may be able to avoid the use of debt. Avoiding debt can save you a lot of money, as well as give you time to think over the purchase.
4.
How does an automatic savings program work?
Money is withdrawn on a regular basis from an existing account and transferred to another account. The process is automatic, which makes it relatively easy for you.
5.
A major purchase is a _______ expense.
Variable. It is variable because you dont normally buy it on a regular basis.