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1.
One advantage of using a home equity line of credit to finance a major purchase is that the interest paid may be tax-deductible.
True. Check the details to be sure, but tax deductibility is common.
2.
A major purchase is a _______ expense.
Variable. It is variable because you dont normally buy it on a regular basis.
3.
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.
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Money is withdrawn on a regular basis from an existing account and transferred to another account.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.
If you want to save for a big purchase over the long term, which of the following options is likely to fluctuate in value the least?
Certificates of deposit. As a general rule, certificates of deposit are the least likely of these to fluctuate in value.