part iii: apply your knowledge! congratulations - you now have a deeper understanding of how various types…

part iii: apply your knowledge! congratulations - you now have a deeper understanding of how various types of savings accounts can be used for different savings goals! now that you know more about the details on these different accounts, apply your learning by helping out the following characters by reading each scenario below and selecting which type of savings account, from the 3 youve chosen above, fits best. 5. robert wants to get serious about saving for a new car. which account would you recommend? why? 6. cindy has been working for 8 years, and shes built up a huge emergency fund -- $45,000, which would be 6 months of her salary. shes hoping to earn a bit more interest than she currently is with that $45,000 just sitting in her traditional banks savings account. which account would you recommend? why? 7. janelle likes to keep all her savings goals separate, so she has an account for each one, including an account to save for her college textbooks every semester. she buys books about every 6 months, with roughly $550 due each time. she likes to save the money up in installments, with auto - deposits from each of her twice monthly paychecks. shes wondering if her online savings account, earning 0.75%, is still her best option for monthly deposits toward her textbooks. which account would you recommend? why?

part iii: apply your knowledge! congratulations - you now have a deeper understanding of how various types of savings accounts can be used for different savings goals! now that you know more about the details on these different accounts, apply your learning by helping out the following characters by reading each scenario below and selecting which type of savings account, from the 3 youve chosen above, fits best. 5. robert wants to get serious about saving for a new car. which account would you recommend? why? 6. cindy has been working for 8 years, and shes built up a huge emergency fund -- $45,000, which would be 6 months of her salary. shes hoping to earn a bit more interest than she currently is with that $45,000 just sitting in her traditional banks savings account. which account would you recommend? why? 7. janelle likes to keep all her savings goals separate, so she has an account for each one, including an account to save for her college textbooks every semester. she buys books about every 6 months, with roughly $550 due each time. she likes to save the money up in installments, with auto - deposits from each of her twice monthly paychecks. shes wondering if her online savings account, earning 0.75%, is still her best option for monthly deposits toward her textbooks. which account would you recommend? why?

Answer

Brief Explanations:

  1. A high - yield savings account could be recommended as it offers better interest rates than a regular savings account, helping Robert grow his car - buying funds faster.
  2. A money market account might be a good choice. It typically offers higher interest rates than traditional savings accounts and still provides some liquidity for Cindy's emergency fund.
  3. Her current online savings account with auto - deposits could still be a good option as it allows for regular, automated savings which fits her need to save in installments for textbooks. However, if there are no minimum balance requirements and better interest - earning options with similar flexibility, those could be considered.

Answer:

  1. Recommend a high - yield savings account. Reason: Higher interest to grow funds faster for car purchase.
  2. Recommend a money market account. Reason: Higher interest than traditional savings with some liquidity for emergency fund.
  3. Current online savings account could be fine. Reason: Allows for regular, automated savings for textbook purchases.