How Financially Literate Are You?

Even if you think you know a lot about money, you can always go the extra mile to increase your financial literacy.

Being financially literate means making smart choices about money and your finances consistently. And it includes understanding some basics, like knowing how your debt accrues interest, how to manage your credit card spending and credit score, and building enough savings for retirement. Financial literacy can also help you save money. In fact, lacking essential knowledge about money costs the average consumer nearly $1,634 in 2020, according to the National Financial Educators Council, a nonprofit group devoted to achieving financial literacy.

Test your financial literacy with Stash’s quiz:

1/12

How Financially Literate Are You?

 

In the year 2000, you could buy lunch for $5. In 2017, that same lunch cost $7.24. What can you attribute this to?

Interest

Inflation

Import tax

2/12

How Financially Literate Are You?

 

How much should you aim to have in an emergency fund?

2-3 weeks worth of expenses

3-6 months worth of expenses

1 year worth of expenses

3/12

How Financially Literate Are You?

 

True or False: A brokerage account can help you keep up with inflation.

True

False

4/12

How Financially Literate Are You?

 

If inflation is 2% and the money in your bank account earns 1% interest, after a year you would:

Earn money

Lose money

Stay the same

5/12

How Financially Literate Are You?

 

Suppose you need to borrow $100. Which is the lower amount to pay back?

$105

$100 plus 3% interest

I don’t know

6/12

How Financially Literate Are You?

 

If you had $1,000 to invest in a moderate performance fund, what could you expect the average rate of return to be after 1 year?

0-15%

16-30%

31% or more

7/12

How Financially Literate Are You?

 

What is the most reliable tactic when it comes to credit card balances?

Pay off your balances in full every month

Always maintain a balance to boost your score

Only pay minimum

8/12

How Financially Literate Are You?

 

When you open a retirement account, you’re putting your money in:

A brokerage account

A regular savings account

A checking account

All of the above

9/12

How Financially Literate Are You?

 

True or false: 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.

True

False

10/12

How Financially Literate Are You?

 

Which of the following can affect your credit score?

Total amount you owe

Types of credit you have

Payment history

All of the above

11/12

How Financially Literate Are You?

 

True or false: A single stock provides more diversification than an ETF (an Exchange-Traded Fund).

True

False

12/12

How Financially Literate Are You?

 

If you borrow $1,000 at 20% compound annual interest rate, and you make no payments, it will take how long for the amount you owe to double?

1-2 years

3-4 years

5-6 years

7-9 years

 

How Financially Literate Are You?

 

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