Savings & Investing Terms

Question 1

Income from an investment paid in a series of payments for a number of years

Answer 1

Annuity

Question 2

Time deposit where a fixed rate of interest is earned for a certain time

Answer 2

Certificate of deposit

Question 3

A defined-contribution plan for employees of companies that operate for a profit

Answer 3

401K

Question 4

Retirement savings plan

Answer 4

Individual retirement account

Question 5

Type of savings account that offers more competitive interest rate

Answer 5

Money Market Account

Question 6

Defined-benefit plan which an employer makes contributions for the employee

Answer 6

Pension plan

Question 7

Interest earned on interest added to an account

Answer 7

Compound Interest

Question 8

Bank account that generally pays a low rate of interest on deposits

Answer 8

Savings Account

Question 9

Firm that provides access to the stock markets

Answer 9

Brokerage

Question 10

Fee charged by a broker for carrying out a transaction

Answer 10

Commission

Question 11

Spreading of risk among many types of investments

Answer 11

Diversification

Question 12

Money paid to stockholders from the corporate earnings

Answer 12

Dividend

Question 13

Something acquired with the goal of making money

Answer 13

Investment

Question 14

How quickly you can turn something to cash without losing value

Answer 14

Liquidity

Question 15

Interest earned only on the original amount or principal

Answer 15

Simple Interest