Question

Which investment is best for someone who is likely to need cash soon?

A. mutual fund
B. CD
C. 401 (k)
D. savings account

Answer 1

D. savings account is the answer.

Explanation:

Saving account is the only option that can be used by someone who is likely to need cash soon.

The mutual funds cannot be withdrawn before three years as the amount will be taxable. The CD or certificate of deposit also cannot be broken before its intended term length and the money via 401(k) also cannot be withdrawn before retirement. So, only savings account is the account where a person can deposit and withdraw money at any point of time.

Answer 2

Answer: Savings account.

Step-by-step explanation: Unlike other modes of investment like mutual funds,etc, a saving account is one in which we can easily deposit and withdraw cash at any time, now-a-days, with the help of ATM card, online banking, etc. So, if a person is likely to need cash soon, he or she should invest money in savings account.

So, the correct option is D. savings account.