Which of the following financial products is good to have so that a person can cover cash needs today?

Master personal finance with the DECA Personal Financial Literacy Exam. Use flashcards and multiple choice questions to deepen your understanding. Prepare for success with detailed explanations and expert tips!

A regular checking account is an excellent choice for covering immediate cash needs because it is designed for daily transactions and provides easy access to funds. With a checking account, individuals can deposit their income, pay bills, and make purchases without having to worry about withdrawal limits or penalties. The funds are typically available immediately, allowing for quick access when needed, which is essential for managing everyday expenses.

In contrast, other options, like a certificate of deposit, require locking in funds for a fixed period, making them less suitable for immediate cash needs. High-yield savings accounts can also pose limitations on the number of transactions allowed each month and may not be as readily accessible as a checking account. Retirement accounts are specifically designed for long-term savings and have restrictions on withdrawals, which makes them unsuitable for immediate cash needs. Thus, a regular checking account provides the necessary liquidity and flexibility to meet current financial obligations effectively.

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