Can you correctly answer these 3 very basic financial questions?
Most 20-somethings in a recent survey could not.
(1) Do you think that the following statement is true or false? Buying a single company stock usually provides a safer return than a stock mutual fund.
(2) Suppose you had $100 in a savings account and the interest rate was 2% per year. After 5 years, how much do you think you would have in the account if you left the money to grow: More than $102, exactly $102, or less than $102?
(3) Imagine that the interest rate on your savings account was 1% per year and inflation was 2% per year. After 1 year, would you be able to buy more than, exactly the same as, or less than today with the money in this account?
(answers below)
Yeesh. How sad.
Out for now.....
Matt
(1) false
(2) more than $102
(3) less than today