Prompt You have $2,000 and want to invest in two savings goals: a short-term goal (less than one year) of saving for
textbooks during your first year of community college, and a longer-term goal (over 1 year) of saving for a
car when you graduate from college. Use the information in the chart below to explain how much you would
choose to save for each goal, where you would save it, and why. When explaining your choices, be sure to
consider the liquidity of each investment, the potential for interest earned, and any potential fees or
penalties.
Savings Account
0.09% APY
No minimum deposit
MMA
24-Month CD
US Savings Bonds (Series EE)
1.05% APY
2.9% APY
0.1%
$500 minimum deposit $250 minimum deposit $25 minimum purchase
$15 fees for
$15 fees for
Penalty for early Cannot redeem during
any withdrawals in any withdrawals in withdrawal is 3 months first 12 months;
excess of 6 per month excess of 6 per month of interest or $25,
before five years,
whichever is greater loss of 3 months of interest