Banking

How Financially Literate Are You, Really?

SavvySugar
Posted on Jan 31, 2011

A recent ING survey found that most respondents have only basic knowledge of finance, meaning that even if they understand the simple rules of finance like emergency funds and saving for retirement, they find it hard to practice them. In fact, under 60% even had a retirement plan. The survey also found that emotional health directly corresponded with financial literacy; the more knowledgeable about finances people are, the happier they feel. Do you think you are financially literate, or are you still learning?

How Financially Literate Are You? - Woman in glasses and purple shirtTake this FINRA Financial Quiz and test your knowledge.

If you have $100 in a savings account earning two percent interest a year, after five years, would you have more than $102, exactly $102, or less than $102?




Imagine that the interest rate on your savings account is one percent a year and inflation is two percent a year. After one year, would the money in the account buy more than it does today, exactly the same, or less than today?




If interest rates rise, what will typically happen to bond prices? Rise, fall, stay the same, or is there no relationship?





A 15-year mortgage typically requires higher monthly payments than a 30-year mortgage but the total interest over the life of the loan will be less.



Buying a single company's stock usually provides a safer return than a stock mutual fund.





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