Strategy Beginner: Automatic Savings and Investment Plans

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1.
Automatic savings and investment plans are often used to fund _______.
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All of the above. These are the most common uses for automatic plans.
2.
An advantage of using an automatic investment plan to fund a retirement account is that it can benefit from compounded earnings as it grows.
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True. Most retirement plans benefit from compounded growth of earnings.
3.
Automated transfers of money between two accounts require that those accounts be from two different institutions.
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False. You can set up an automated transfer between two accounts at the same institution.
4.
An automatic savings plan withdraws money from an existing savings or checking account on a periodic basis and deposits it into another account.
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True. The period is usually monthly or weekly.
5.
Some certificates of deposit accept additional deposits.
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True. Add-on certificates allow them, which makes them ideal for some peoples automatic investing plans.