The Carnival of Personal Finance #96 has been published at All Financial Matters, providing us with a strong collection of financial articles such as the following:
Consumerism Commentary asks whether high schools should require money management classes. I believe there’s a time and place for learning personal finance as formal subject matter. I strongly believe that money management is something a student should be exposed to prior to becoming a credit card carrying member of the work force. The question is when should this exposure take place? Flexo says, how about 7th grade? A good debate rages on over there and in the rest of the blogosphere.
To get a feel for the type of questions administered to students, you can try this personal finance quiz: the JumpStart Coalition for Personal Financial Literacy 2006 survey. According to Bankrate, more than 5,000 high school seniors from 37 states took the survey to test their knowledge on various financial topics including insurance, investing, debt and saving and incurred an average score of 52.4 percent. Though this quiz has been offered in the past, results haven’t been much different this time around.
I took the test myself and thought that there were a few questions there tricky enough to stump the average person, what more a student. In fact, if they tried this test, I’ll wager that most of the people I see everyday won’t get a perfect score and some will probably flunk it outright, scoring lower than what high school students have done. Here are a few sample questions from the survey:
- Many savings programs are protected by the federal government against loss. Which of the following is not?
- A bond issued by one of the 50 states
- A U.S. Treasury bond
- A U.S. savings bond
- A certificate of deposit at the bank
- Doug must borrow $12,000 to complete his college education. Which of the following would NOT be likely to reduce the finance charge rate?
- If his parents took out an additional mortgage on their house for the loan
- If the loan was insured by the federal government
- If he went to a state college rather than a private college
- If his parents co-signed the loan
- If you had a savings account at a bank, which of the following would be correct concerning the interest that you would earn on this account?
- Sales tax may be charged on the interest that you earn.
- You cannot earn interest until you pass your 18th birthday.
- Earnings from savings account interest may not be taxed.
- Income tax may be charged on the interest if your income is high enough.
So how well did you do? I maintain that I and most folks I know never got the type of education to pass such tests with ease. We need that finance curriculum in schools somehow.
Now on to the rest of my picks!
Five Cent Nickel recommends how to prioritize retirement accounts. Are there too many retirement accounts available for you to fund? Then this article is especially helpful for those lucky enough to be facing such a dilemma. Consider this if you’re offered employee sponsored accounts or are eligible for a SEP-IRA by being self-employed.
NCN Blog goes personal with NCN telling us how it was for him to prepare for life without a credit card. This is a nice, concrete step by step discussion on how to forego the credit and still survive.
The 6 Month Project is a new blog I discovered through the carnival and its author gives us a peek into his attempts to cut the fat from his budget. Again, I appreciate the personal angle he provides as he works on his expenses.
This was quite an enjoyable carnival, I must say. No surprise that it was tough for me to select my favorite articles this week.
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{ 5 comments… read them below or add one }
Thanks for the link… it’s a fiery debate.
Thanks for the link!
SVB,
Thanks for the link to the quiz. Although rusty, I must be still a good multiple choice test taker. Scored a 100 on the first try. Hope there is some correlation to future wealth
Good for you Super Saver. I need a bit more practice and review…
This is a briiant idea.
My parents were bad with money, so they did not teach me anything about it.
Nothing was taught in school.
As a result i had no idea how credit worked and about credit reports.
My credit was ruined before age 19, i missed out on the 2000 real estate boom in California a result.
Financial education is definately a must, if all it does is help elimiate some people from teh shackles of comsumer debt before they get into it in the first place it will be well worth it,