Strategy Beginner: Automatic Savings and Investment Plans

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1.
If you are averse to risk and you want to save money for a purchase three months from now, why would a savings account be a good choice to put your money into?
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It has a low risk of loss. This may make it an ideal choice.
2.
Using an automatic investment plan to fund a retirement account is only for the young.
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False. Even later in life, you can still build up a sizable amount of money.
3.
Regular purchases of stock with money taken out of an existing account are an example of an _______.
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Automatic investment plan. In this case, money is going toward buying investments.
4.
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.
5.
A good way to determine how well you can afford to participate in an automatic savings plan is to find out where you are spending money needlessly in your budget.
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True. This can become a new source of funds for you.