The Inside Agenda Blog

How Financially Literate Are You?

by Navin Vaswani Tuesday October 21, 2008

In my research for tonight's one-on-one interview with Dartmouth College Economics Professor Annamaria Lusardi, I came across a financial literacy quiz over at the Wall Street Journal. It was conducted earlier this year by Jump$tart Coalition, an organization aiming to improve personal financial literacy. Over 6,800 American high school seniors took the quiz, and the results weren't very good. The average score was a disappointing 47.5% 


Since I've been reading about financial literacy and it's been on the brain for a couple of days, I decided to take the quiz. It is an American quiz, so keep that in mind if you want to test your own financial literacy, but I thought I'd give it a whirl anyway. My results, you ask? I answered 25 of 31 questions correctly, for a score of 81% (A-). I think it's a decent score but, cue flashbacks from my past, I think I could have done a little bit better.


Granted, I'm not so sure how I'd have fared had I taken the test as a 17 or 18-year-old finishing up high school. Looking back on my high school days, saving money was definitely not part of my modus operandi.


That being said, even at 17 or 18 years old, I think I would have fared better than the average high school student. I think I've always been relatively up to speed on finance issues, both personal and in a broader sense, and for that I largely have my father to thank. He really took the time to educate my brother and I on financial issues, after having mostly educated himself on the topics. So, luckily, I come from a financially responsible household. In fact, I don't recall learning much about personal finance during my grade school and high school years. If it weren't for my father, I don't imagine I'd be in very good shape when it comes to financial literacy. So, thanks, Dad. 


What do you think, should issues relating to personal finance - the wonders of compounding interest, the idea of saving money from an early age, and the idea of thinking about retirement from an early age - be taught in our public schools? Should personal finance be a mandatory course in school, much like science and literature? I must admit, I tend to think it should be.


I would love to hear from you. If you took the time to take the quiz, I'd love to hear how you did. I've set the bar at 81%. I'd also love your thoughts on what you think the future holds for financial literacy, and whether you think it belongs in the home or at school. 


Here's the link for the WSJ/Jump$tart quiz one more time.