U.S. News & World Report posted an excellent six-question financial literacy quiz that most 12th graders can pass. Can you?
The quiz is produced by the Jump$tart Coalition for Personal Financial Literacy and asks several surprisingly complex questions about credit, savings, and loans.
There’s no shame in missing a question. U.S. News & World Report’s very own Alpha Consumer missed one, and in the interests of fairness and besmirching our own (good?) name on the internet, we had to guess (correctly!) on one or two ourselves.
Share your results in the comments.
Quiz: Are You Smarter Than a 12th Grader? [U.S. News & World Report]
(Photo: Getty)
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God… If 8th graders (me) can pass this, then 12th graders should be able to…
6/6
Suck it twelfth graders.
6/6. I am so smart. I am so smart. S-M-R-T. I mean S-M-A-R-T.
@bluewyvern: Most 12th graders didn’t pass. Carey made that up. Someone needs at least 5/6 to pass in my book (one gimme, no more).
@sriver: Gig ‘em.
@char: But it said “rate”, which isn’t affected (in theory) by the amount of money you’re borrowing. So while the finance charges might be higher, the percentage rate is not.
Also, to everyone who says the stocks thing is “not definite”, that’s why they qualified it with “tends to”. The questions aren’t great, but there’s generally an obviously correct answer if you read the questions carefully.
Got me a 6/6. I think the people reading consumerist are smart enough to get this right. Let’s put it on as a facebook app and see.
6/6 easily. I don’t see how people could get confused over #6 since all the other choices either barely keep up with inflation or give virtually no interest at all.
@humphrmi: OMFGROTFLMFAO! That was funny!
5 out of 6 correct for me!
I missed the fourth question (the college loan question).
Not bad eh?
@all those people who think that 12th grades can’t pass this:
You are right. I have a natural affinity for numbers and can see risk all the time. When I was in high school(3 years ago). I remember the normal economics class was a joke and the teacher was only trying to get the kids to pass so they can graduate. It’s not something easy and intuitive for someone who is not apt at math. As a result of my affinity for math and numbers, I have become the quintessential ‘money bitch’ so whenever someone needs to work numbers on their money, they always gimme a ring a ding ding and ask away. I remember doing a budget but then there was no guidelines of where to go in terms of what is and what isn’t too much.
I believe the problem lies with parents not interacting with their kids when it comes to their education, specifically math. My brother teaches in a lower income school in a nice suburb of San Francisco. Unfortunately it is math that he teaches and realized at the first day that these high schoolers who he should teach geometry and algebra cannot even do multiplication correctly or addition(no 5×0 is not 5). A parent just passes the kid off and it is sad that the teachers have to do the same.
A quick Google search netted the full 30-question quiz, which is totally 5 times the fun!
I got 28/30. I’m taking a mulligan on one of the wrong answers, so I really got 29/30. (Of course I knew the answer to #1. It was just a brain fart.)
6/6. Question 4 was worded horribly.
Eep…I got 3/6. In my defense, though, I tend to research things before I do them, and I’ve never borrowed for a car or a vacation, and don’t have anything invested beyond my 403b and a high-yield savings because I just recently started my career job.
(For the record, the one that got me was question No. 5, on earning interest on savings accounts.)
She missed THAT one? Has she ever filed a tax return?
6 out of 6, although the last one almost got me.
Stocks also have the most risk. What’s better to know in 18 years? That you’re definitely going to have a return (CD Savings account or bonds) or that you might have a return (stocks)?
6/6…I was thinking there would be more generalized questions, for some reason.
@FromThisSoil: As I said above, that’s why it said “tends to” and didn’t make an absolute statement. Risk and return are generally related…you have to take higher risk to get a higher return, and if you’re not getting the higher return you shouldn’t take the higher risk. So low risk things are going to have a lower return over time. There are of course ways to manage risk while investing in stocks, mainly by diversifying your investments.
I wonder how many of these six out of sixes really got six out of six. As a freshman in college, I got 5. So, no I’m not smarter than a 12th Grader. And while my high school was top in it’s area, we didn’t learn a thing about credit and personal finance, and I took AP Micro and Macro economics.
Just because this material may not be taught in High School, doesn’t mean that 12th graders shouldn’t be expect to know the basics of personal finance and credit. Where is the parental responsibility in preparing their children for real world issues?
The questions on the quiz were taken from a larger test on money matters. The 52% represents the average score on the larger test.
@MykalBloom: I wonder how many of these six out of sixes really got six out of six.
My guess is all 20 of them, since posting here is a self-selected group of at least 7,000 viewers. I suspect the readers who got scores lower than 5 are not reporting (except for the alleged t-sip above).
@FromThisSoil: What’s better to know in 18 years? That you’re definitely going to have a return (CD Savings account or bonds) or that you might have a return (stocks)?
If you invest in an index fund, it’d be unlikely that you’d invest in 18-year span where stocks didn’t beat savings. You’d pretty much have to invest during an 18-year period that includes the great depression. Even so, the best is to diversify.
Information is provided ‘as is’ and solely for informational purposes, not for trading purposes or advice, and may be delayed.
6/6, that was pretty easy… though I did just do my taxes, which probably helped.
5/6, and I missed the third one due to misreading. I felt good that I got some of the others right, because frankly, I’m still a financial idiot
6/6. I think the last question regarding stock return was fair. In general terms, 18 years is a long enough timeline to mitigate the risk of investing in, say, an index fund.
Of course, that is not the same as a guaranty of a return. However, the only conceivable scenario where that would not be the case is if some economic disaster occurred. In the face of a correction that large, it would matter very little where you placed the money– the investment would be impacted. Even in the most stalwart savings institution, a correction that would wipe out a significant chunk of 18 years of market gains, would negate the 0.25% – 1.5% that you might earn annually from a statement savings account.
6 of 6… why does your photo show 6th graders?
I’m so bad at math, I can’t even tell you how many I got right. Now that’s a liberal arts education. Just kidding, I got 5/6, but if I had known that stuff about college loans maybe I wouldn’t have gone to a better school.
4/6
I know nothing about college loans.
I missed the stock one too, for the same reason as everyone else. I figured risk would be a factor in the correct answer.
4/6 and I teach college!
6/6.
BUT, I think number one should have another option. Most credit cards offer a promo rate of 0% for 6-15 months, and if the person plans on paying it off within that time period they would pay no finance charges (however they would likely face foreign currency conversion fees if they used the card overseas).
Embarrassing, but 3/6. Finishing up my first year of college. Though I did go to a newly-established public hs, in which all I did in Econ was watch documentaries.
6/6 and that really wasn’t hard.
@jhuang: stop making excuses. lmaoz
@The Instructor: obviously not finance, or english. (couldn’t let it pass)
The “college loan” question isn’t actually about college, it’s about collateral. Three of the options mean the loan is now backed by something more than just the borrower’s promise. It’s a cop-out to complain about that one just because it’s college-related
Still, don’t feel bad. 1, 4, 5 and 6 were among the hardest questions of the original 30. A 3/6 on this quiz would definitely put you ahead of them.
Also fascinating is the breakdown of average scores by various other questions. The single best predictor of the students’ score was their answer to the following question:
What do you think happens to older people when they retire if they haven’t saved much money and don’t have a good pension from their former jobs?
a) They live pretty well on Social Security.
b) They get by on Social Security by keeping their expenses down.
c) They find it tough to live on Social Security.
Just behind it was household income, and then race (which is probably just correlated with income).
Check the complete breakdown here: [www.jumpstart.org]
@richcreamerybutter: same reason I got a 5/6 – I think stocks and I think of people jumping out of windows because the market crashed. This is why, when I start making real money, I’m putting my paycheck between my teeth and running to a reputable advisor.
@BlondeGrlz: I only got three out of six, but then it’s late, I’m tired, and I never do well on pop quizzes.
6/6 correct. Can I have Alpha Consumer’s job? (On the other hand, would I want it?)
6/6 yay! Guess that college paid off.
Wow that’s awesome, I got 2…and in my defense we never covered anything even remotely close to that in high school. I mean, that’s no excuse for not knowing it but the assertion that 12th graders know that stuff…no, it was never apart of any required curriculum. The very closest thing would be calculating interest in math class. That test only serves to remind me how ill-prepared I am for this adult world full of credit and loans and things. Thanks, Ohio Department of Education.
5/6 and I’m in 11th grade, a lot of this really was common sense.. Though, I was surprised by number 2…
@mr.tank: Mine did.
Anyway, I’ve also taken two Accounting courses in college and a course in finance, so 6/6 was easy…and I am an awful test taker.
There ain’t no one smarter than a twelth grader. Just ask one.
BTW, I, uh, skipped twelth grade and still got 6:6. I guess I learned those things in the real world where I’ve run a business, gotten loans, purchased stocks and paid taxes.
5/6 — Not bad for a non-American, I’d say.
@weave:
I agree.. it’s like trickery. “Asking questions that look for the affirmative, then another that asks for a negative, makes one have to shift their brain’s gear 180 and if you’re not careful you can make a stupid mistake.” If there were a time limit it may have been a little harder.
It’s kinda funny how everyone is patting themelves on the back because they got questions right that when in high school they probably would have gotten them wrong. I wish they would teach a full semester in high school “financial preperation for the real world” as well as a refresher course in the first year of college when those dirtbags are trying to sign fresh 18 yr olds up with a credit card on campus. tsk tsk.
4/6..
@PryncessLayah: “those dirtbags are trying to sign fresh 18 yr olds up with a credit card on campus.”
I had no income while in school, but they didn’t mind. They got so annoying that I started avoiding the student union my last semester of school. Two months after graduating and getting a salaried job, one of those idiot companies had the nerve to deny my credit application. I sent them a letter pointing out their hypocrisy, and got my freaking credit card.
6/6. But I have a degree in economics.
I’d be stunned if 12th graders really got those questions right on a regular basis.
I got 3/6. It must matter though that I a) Just graduated grade 12 last year and b) am Canadian, so these questions aren’t really directed towards me.
5 out of 6, I got the college loan one wrong. In my defense I never thought about going to a state college and my parents arranged the loans and stuff for college, so I’m not familiar with the regulations behind it all.
I graduated high school last year, and really didn’t know the answer to any of those questions. We just weren’t taught it.
@richcreamerybutter:
#6 is rather misleading, though.
Stocks have the best average rate of return but the worst “worst-case” rate of return. You aren’t insured against any losses like you are with savings/checking accounts and bonds, but you’re guaranteed to get at least whatever money you put into the bank/bond, usually up to $100,000 for the bank accounts and a practically infinite amount for the bond (unless the government repudiates its debt).