Are you financially literate? Most Americans aren't.

Are you financially literate? Most Americans aren't.

Investor · Peachtree Corners, GA · Member since 2014 · 1k+ posts · 1k+ votes

I feel to succeed at real estate in the long term it requires at least a fundamental understanding of finances.  The WSJ recently ran a piece about the lack of financial literacy in this country, Three question financial literacy test 

This test designed by professors at MIT and Wharton ask some very basic financial literacy questions (no they aren't trick questions) and only 44% of college graduates got all three right. 

I'm not asking anyone to share if you got the questions right, but if you didn't get all three right, in fact if you didn't think they were trick questions, you almost certainly need to hone your financial literacy skills.  Again, I'm not trying to shame anyone, I'm just trying to make people realize that they may be among the majority in  America who don't have basic financial literacy skills and the need to do something about it. 

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Scott TrenchPro Member
Rental Property Investor · Denver, CO · Member since 2014 · 2k+ posts · 6k+ votes
11y

And everyone wonders why income inequality is increasing...

See this reply in the discussion

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  • Scottsdale, AZ · Member since 2014 · 659 posts · 536 votes
    11y

    This can't be right....  I am a high school dropout and these questions were beyond easy.

  • Investor · Peachtree Corners, GA · Member since 2014 · 1k+ posts · 1k+ votes
    11y
    Originally posted by @Steve Olafson:

    This can't be right....  I am a high school dropout and these questions were beyond easy.

     That's precisely why I wrote this "in fact if you didn't think they were trick questions, you almost certainly need to hone your financial literacy skills."

  • Jersey City, NJ · Member since 2015 · 280 posts · 98 votes
    11y

    Wow. This is beyond imagination.  Unless the other 56% think these are trick questions.

  • Investor · Canton, GA · Member since 2014 · 727 posts · 500 votes
    11y

    This should not really be a surprise. 

    At what point are students taught about personal finance? Not in K-12, not even in the University. I wasn't. Taught by our parents? Maybe, if they know what to even teach. This is a glaring huge gap in the middle of our education system, and those with the money in this country like it that way. Keeps the population dumb, easily malleable, vulnerable, and they don't put up a fuss when they are screwed over by our politicians elected to "represent" us in our state capitals and in DC.

  • Investor · Peachtree Corners, GA · Member since 2014 · 1k+ posts · 1k+ votes
    11y
    Originally posted by @Che Chiu Wong:

    Wow. This is beyond imagination.  Unless the other 56% think these are trick questions.

     I wish that was the case, but the point about men being very confident about their (wrong) answers kind of negates that argument. 

  • CPA · Raleigh, NC · Member since 2013 · 1k+ posts · 2k+ votes
    11y

    I remember seeing the actual survey and thinking I was being trolled.  

  • Investor · Peachtree Corners, GA · Member since 2014 · 1k+ posts · 1k+ votes
    11y
    Originally posted by @Brandon Hall:

    I remember seeing the actual survey and thinking I was being trolled.  

     LOL!  Yeah it really is that bad.  

  • Cape Coral, FL · Member since 2015 · 33 posts · 6 votes
    11y

    way too easy. I haven't made the most financially sound decisions as of yet however I'm working on changing that. I will never be one who lives with nothing and saves eveything however I do live a comfortable life and now will be acquiring buy and holds to help make it easier especially closer to retirement age. 

  • Scott TrenchPro Member
    Rental Property Investor · Denver, CO · Member since 2014 · 2k+ posts · 6k+ votes
    11y

    And everyone wonders why income inequality is increasing...

  • Investor · San Diego, CA · Member since 2014 · 592 posts · 765 votes
    11y

    Full paper available here:

    http://papers.ssrn.com/sol3/papers.cfm?abstract_id...

    Also provided in the paper is a comparison of the US to other countries (other developed nations still did not have an impressive % of all correct answers but better than the US):

    And the highlighting of a gender gap:

    "Another striking finding, also consistent across countries, is that men are more confident about their financial knowledge than they should be: even when they were wrong, they reported being ‘very confident’ about their answers."

    Haha!

  • Investor · Peachtree Corners, GA · Member since 2014 · 1k+ posts · 1k+ votes
    11y

    @Frank Jiang

    Thanks for posting that pathetic as it is.

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