The Money Quiz That Can Change Your Life

Ok all of you “personal finance buffs”, so you think you can dance? No, wait a second, that’s a whole other thing, Monday nights on Fox at 8 PM. With hostess Cat Deeley! But I digress…

You think your know your finances? Try this money quiz to see how much you really know, and you might just change your life, and your finances!

Personal expertise about money issues is a subject all of us strive for and some of us are really good at it. The truth about it is that we usually learn the ins and outs of money the hard way, and hopefully we all learn from our mistakes and never repeat them. Since I have made many a money mistake in my lifetime, I consider myself an expert. Hmmm, is that a good thing to admit? Well, whether it is or not, it has helped me learn a thing or two about what and what not to do to build good finances.

Today, I’d like to present this money quiz for you to check and see how much you know and have learned. How much expertise have you accumulated about these subjects? This kind of knowledge will help to determine your financial success and might just open up your eyes and change your life right now. As I say, the best time to get started is always now, so let’s do it! Write down your best answers to these 12 questions and you’ll find the key and explanations on the next page.

The Money Quiz

1. A financial expert stresses that you should start saving your money as early in life as you can. What is the reason that they say that?

a. You have more money when you are younger because you have fewer bills and can save more

b. It’s a good habit to develop that always lasts a lifetime

c. It means you will seek to use financial advice all through your life and that’s good for your wallet

d. Your money grows faster through compounding interest and appreciation the sooner you begin saving and the longer you hold on to it

2. What key question should you ask yourself before you make a really big purchase?

a. Can I charge this expense to my company or write it off as a business expense?

b. Should I go into debt over this purchase?

c. Will making this purchase get me closer to any of my financial goal(s)?

d. Would Warren Buffet or Bill Gates do this if they were in the position I am in right now?

3. Sam and Joe each have a Traditional IRA account. Sam saves $3,000 a year every year from age 20-29, and then never saves another penny. Joe saves $3,000 every year from age 40 until he retires at age 65. Assuming they both get the same rate of return on their investment, who will have more money at age 65 in their IRA account?

a. Joe

b. Sam

c. They will both have the same amount

4. Mary lives 35 miles from work and is thinking about buying a car to commute. She dislikes taking the train to work even though it takes the same amount of time either way she commutes to her job each day. It costs $40 a week for round trip train fare, and she estimates it will cost $30 a week to fill up with gas if she drives. Will Mary save money each week if she continues to take the train instead of driving?

a. Yes

b. No

c. She will only save if she drives and has a partner to share the cost of gas

5. Steve just added a new room to his home and it has increased the home’s value by 20%. He needs to increase his homeowner’s insurance coverage now. How much can he expect his premium to increase?

a. Not too much of an increase and certainly less than 20%

b. 20% of course, that’s what the house is going to increase in value

c. Steve doesn’t need to increase the policy value, that is just adding an unnecessary extra expense for no good reason

6. Sara puts $20 a week every week in a high interest savings account at 4% interest (compounded monthly) for her newborn son. If untouched, how much will he have in his account on his 21st birthday?

a. About $21,000

b. About $25,000

c. About $30,000

d. About $35,000

7. Alan has a debt of $3,000 on his credit card and pays 16.5% interest on it. If he pays only $45 each month on his debt, how long will it take him to pay it all in full?

a. 3 years

b. 6 years

c. 12 years

d. Over 14 years

8. You sign a guarantee (co-sign) for a car loan for your best friend. Your friend defaults on the loan and you are now getting collectors calling every day. What is the amount you are obligated to pay on the debt?

a. You are responsible for the remaining balance on the debt in full

b. You and your friend are each responsible for half the remaining balance

c. Your friend has to pay everything, you were just used as a signatory reference

d. Since the loan is now in default, you and your friend should refinance it

9. Your bank sends you an email saying that there is a problem with your account and provides a link for you to click to help clear up the problem. You should

a. Click on the link ASAP and follow the directions to make sure your account is safe and accessible

b. Don’t click on it and notify your bank by phone about the issues

c. Call the bank number listed in the email to make sure it’s legitimate

d. Click on the link but don’t enter any personal details until you read all of the fine print

10. You own your current home with no mortgage when you retire. About how much of your current income do experts say you will you need to live in the same lifestyle you have right now while in retirement?

a. 40%

b. 50%

c. 67%

d. 85%

11. Sue is 55 and is planning to retire this year. How many years should she be planning her funds to last in her retirement based on her age right now?

a. About 20 years

b. About 25 years

c. About 30 years

d. More than 30 years

12. Mary and Alice decide to share an apartment together. Mary puts the electricity, cable, and phone in her name and they split the bills in half each month. After 8 months, Alice decides to move out and leaves the apartment. Can Mary get Alice to pay for half of the bills including the rent until the end of the lease?

a. Yes, Alice is still responsible for half and must pay Mary

b. Yes, if Alice is on the lease she must continue to pay Mary

c. No, Mary has her name on all the accounts and Mary is solely responsible and unable to recoup her costs

d. No, Mary can’t make Alice pay anything, but she could take her to court and seek the money if Alice won’t pay

Now click on page 2 for the answers!

About Gary Weiner @ Super Saving Tips

Over the last 45 years I’ve worked in retail (department stores and supermarkets) and financial planning. In addition, I am a shopper, born and bred, who enjoys the challenges of finding the best items for the best prices. When I’m not busy saving money or writing here at Super Saving Tips, I enjoy baseball, music, and classic movies. I am retired and live in New Jersey with my wife.

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16 Comments

  1. Great quiz Gary! I scored an 8. #5 and 11 tripped me up. I do review our insurance periodically but have never made any big additions on our home to have to increase the policy.
    Brian Brandow recently posted…Connecting More Offline in an Online WorldMy Profile

  2. Hey Gary, You know that last paragraph would make a great post. I missed more than I thought I would, and I’m AWFUL about asking for help. (Looking for research/advice, fine. Asking for help? not so much.)

  3. Great post Gary! This quiz is the best personal finance lesson I ever got!
    Ron Pickle recently posted…How to Find a Good Roofing Company?My Profile

  4. Awesome quiz. I think you should re-post it a few times a year.

    I scored a 7 but I was too lazy to pull out a calculator for #6 and 7 and I didn’t know the answer to #10 because we spend far less than what the experts come up with.

  5. I found the commuting question to be interesting. Right now the goverment pays you 53.5 cents per mile to drive for them, and allows other employers to pay that much, without it being considered income for the recipient. Looking at Mary, she’s 35 miles from work, or would drive 70 miles round trip per day. At 53.5 cents per mile, her daily cost could be $37.54, almost what she is paying for a weekly train ticket.

    • RAnn, I am not aware of any employers who will reimburse you for a commute to your workplace round trip. In my experience, it was for mileage that was not your routine commute that I was reimbursed for and is typically what’s done. Government allowances are for business use, but not for a regular commute to your place of business. That’s why I listed the answer the way I did. It might have been a different discussion if she travelled for her job. Thanks for bringing up an interesting point.

  6. Ok I flunked. I learned a lot but most of it is too late!
    Great quiz.

  7. The Mary and Alice one is tricky. But where would Judge Judy be without the Mary and Alice’s of life?

  8. Totally made me pull out the calculator! Fun post, Gary!
    Femme Frugality recently posted…#WomensEqualityDay: Where We’ve Been & Need to GoMy Profile

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