Hree years ago, Isabel got her first job after graduating from college. Once she began earning a steady monthly income, she decided to start saving for a new car. To help her stay on track with her savings, Isabel set up a savings account at her bank and arranged to automatically transfer money into it. On the 15th of every month, the bank transfers $200 from her checking account to her savings account. The interest on her savings account is 1.70% compounded monthly. Part A
Question
Which term best describes the savings account that Isabel has set up, given its purpose?

Select the correct answer.

emergency fund
mutual fund
rainy-day fund
sinking fund

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