FINANCIAL LITERACY QUIZ
#1 HOW MUCH SHOULD I SPEND ON HOUSING COSTS?
A. No more than 25% of my net income (take-home pay)
B. No more than 75% of my net income (take-home pay)
C. Whatever amount the lender qualifies me to borrow
D. Whatever amount makes me feel comfortable
#2 I SHOULD STRONGLY CONSIDER A 15-YEAR MORTGAGE INSTEAD OF A 30-YEAR MORTGAGE
A. Yes, because my monthly payment will probably be lower.
B. Yes, because I will pay less interest over the term of the mortgage.
C. No, because my payment will probably be higher.
D. No, because the 15-year mortgage will probably involve a higher interest rate.
#3 HOW BIG SHOULD MY EMERGENCY FUND BE?
C. Equal to one month of living expenses
D. At least six months' worth of living expenses
#4 WHO PROBABLY HAS THE GREATEST NEED FOR LIFE INSURANCE?
A. A retired couple
B. A single woman
C. A married couple with no children
D. A single mother with three children
#5 WHAT IS THE BEST TIME TO BEGIN SAVING FOR RETIREMENT?
A. After I have purchased a house
B. After my house mortgage has been fully paid
C. I probably will not need retirement savings because Social Security should be sufficient.
D. As soon as possible